                                                              [DO NOT PUBLISH]

                        IN THE UNITED STATES COURT OF APPEALS

                              FOR THE ELEVENTH CIRCUIT
                               ________________________          FILED
                                                        U.S. COURT OF APPEALS
                                     No. 10-12152         ELEVENTH CIRCUIT
                                 Non-Argument Calendar        FEB 25, 2011
                               ________________________        JOHN LEY
                                                                CLERK
                          D.C. Docket No. 8:08-cv-00899-EAK-MAP

FEDERAL TRADE COMMISSION,


lllllllllllllllllllll                                          Plaintiff - Appellee,

                                         versus

USA FINANCIAL, LLC,
a Florida Limited Liability Company,
AMERICAN FINANCIAL CARD, INC.,
a corporation formerly known as Capital Financial, Inc.,
JEFFREY R. DEERING, individually and as owner, officer
or manager of the above listed corporations,
RICHARD R. GUARINO, individually and as owner, officer
or manager of the above listed corporations,
JOHN F. BUSCHEL, JR., individually and as owner, officer
or manager of one or both of the above listed corporations,


lllllllllllllllllllll                                     Defendants - Appellants,

UNITED STATES OF AMERICA,


lllllllllllllllllllll                                                  Defendant.
                           ________________________

                   Appeal from the United States District Court
                       for the Middle District of Florida
                         ________________________


                                (February 25, 2011)

Before PRYOR, MARTIN, and FAY, Circuit Judges.

PER CURIAM:

      USA Financial, LLC, American Financial Card, Inc., f.k.a. Capital

Financial, Inc., Jeffrey R. Deering, Richard Guarino, and John F. Buschel, Jr.

appeal the grant of summary judgment entered in favor of the Federal Trade

Commission (“FTC”) and against defendants, jointly and severally, for permanent

injunctive relief and for equitable monetary relief in the amount of

$17,300,509.00. In a three-count complaint, the FTC alleged that the defendants

violated the Federal Trade Commission Act (“FTCA”), 15 U.S.C. § 45(a), and

Telemarketing Sales Rule (“TSR”), 16 C.F.R. § 310.3(a)(2)(iii), by making false

and misleading representations in connection with the marketing of advance-fee

credit cards. The FTC also alleged that the defendants violated the TSR, 16

C.F.R. § 310.4(a)(4), by requesting and receiving payment of a $200 fee before

obtaining or arranging an extension of credit.

                                         2
       The defendants argue on appeal that the district court erred by: (1) granting

summary judgment for the FTC; (2) finding individual liability; (3) granting the

FTC’s request for a permanent injunction against American Financial; (4) freezing

their assets; and (5) awarding consumer redress. After thorough review, we

affirm.

                                               I.

       Between November 2004 and late 2007, the defendants marketed and sold

advance fee credit cards to consumers through telephone solicitations.1 During the

calls, consumers were told that they had been approved for a credit card with a

credit limit of $2,000, cash advance capabilities, and a fixed interest rate of 8.9%.

Consumers were also told that to open an account they had to pay a one-time fee

of $200.

       Once consumers agreed to open an account and provided their bank

information for payment of the one-time fee, they listened to a recorded

“verification script.” The recording set out the credit card’s terms and conditions.

It informed callers that the card being offered was “not affiliated with [V]isa or


       1
          Because this case is before us after the district court’s grant of summary judgment in
favor of the FTC, we view the facts in the light most favorable to the defendants, the non-moving
party. See Bankston v. Then, 615 F.3d 1364, 1367 n.3 (11th Cir. 2010) (“We review a district
court’s grant of summary judgment de novo, viewing all facts in the light most favorable to the
non-moving party.”).

                                                3
[M]astercard” and was a “merchant finance account.”

      Consumers received a thin-plastic card usable only for purchasing products

from an online catalog. The FTC learned that the Better Business Bureau of West

Florida had received 766 complaints against American Financial and 52

complaints against USA Financial. In the complaints, consumers stated that they

paid the $200 fee believing that they were obtaining a credit card that could be

used to make purchases anywhere—not a catalog card that could only be used at

the defendants’ online store.

      The FTC filed this action, alleging violations of the FTCA and the TSR.

The district court granted the FTC’s motion for summary judgment, concluding

that no reasonable trier of fact could find in the defendants’ favor. The defendants

now appeal.

                                         II.

      We review a district court’s grant of summary judgment de novo, viewing

all evidence and drawing all reasonable inferences in favor of the non-moving

party. Rine v. Imagitas, Inc., 590 F.3d 1215, 1222 (11th Cir. 2009). Summary

judgment is appropriate where “there is no genuine dispute as to any material fact

and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a).

A genuine issue of material fact exists when “the evidence is such that a

                                         4
reasonable jury could return a verdict for the nonmoving party.” Anderson v.

Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510 (1986); see also

Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997) (“The basic issue

before the court on a motion for summary judgment is ‘whether the evidence

presents a sufficient disagreement to require submission to a jury or whether it is

so one-sided that one party must prevail as a matter of law.’” (quoting Anderson,

477 U.S. at 251–52, 106 S. Ct. at 2512)).

                                         III.

                                         A.

      Section 5 of the FTCA makes “unfair or deceptive acts or practices in or

affecting commerce” unlawful. 15 U.S.C. § 45(a)(1). “To establish liability under

section 5 of the FTCA, the FTC must establish that (1) there was a representation;

(2) the representation was likely to mislead customers acting reasonably under the

circumstances, and (3) the representation was material.” FTC v. Tashman, 318

F.3d 1273, 1277 (11th Cir. 2003).

      The defendants made material representations in their telemarketing calls

that created the deceptive impression that they were offering consumers a general

purpose credit card. See FTC v. Cyberspace.com, LLC, 453 F.3d 1196, 1200–01

(9th Cir. 2006) (finding a mailing extending an offer for services at a monthly fee

                                            5
unlawful because it created the deceptive impression that it was simply a refund or

rebate). The defendants represented that the offered card had the features of a

general purpose card. Consumers were told that it had a fixed interest rate, a

$2,000 credit limit, and cash advance capabilities. The verification scripts that

informed consumers that the credit card being offered was not affiliated with Visa

or Mastercard and was a “merchant finance account” failed to dispel the confusion

that the defendants’ representations created among reasonable consumers. The

overall impression created by the calls was that consumers were receiving a card

that could be used to make purchases anywhere.

      Our conclusion is bolstered by the Receiver’s finding that less than 3

percent of USA Financial’s 2007 revenues were derived from merchandise sales.

The fact that consumers did not purchase the defendant’s products after obtaining

their credit cards, which they could use to buy only defendant’s products, suggests

that they were actually deceived. While “[p]roof of actual deception is

unnecessary to establish a violation of Section 5, such proof is highly probative to

show that a practice is likely to mislead consumers acting reasonably under the

circumstances.” Id. at 1201 (alteration in original) (citation and quotation marks

omitted).

      The district court did not err in granting summary judgment to the FTC on

                                          6
the FTCA § 5 violation because, viewing the facts in the light most favorable to

the defendants, no reasonable factfinder could conclude that the telemarketing

calls were not likely to mislead customers acting reasonably under the

circumstances in a way that is material. See Tashman, 318 F.3d at 1277.2

       We also conclude that the district court properly granted summary judgment

in favor of the FTC on the TSR violations. Under 16 C.F.R. § 310.3(a)(2)(iii),

“[i]t is a deceptive telemarketing act or practice . . . for any seller or telemarketer”

in the sale of goods or services to misrepresent, directly or by implication, “[a]ny

material aspect of the performance, efficacy, nature, or central characteristics of

goods or services that are the subject of a sales offer.” The defendants violated

§ 310.3(a)(2)(iii) by creating the impression in their solicitations that the credit

card being offered could be used to make purchases anywhere. Likewise,

§ 310.4(a)(4) criminalizes “[r]equesting or receiving payment of any fee or



       2
           We note that the defendants argue that the district court erred in granting summary
judgment for the FTC because they had a “good faith” defense and were operating under a
consumer finance license issued by the state of Florida. However, a defendant cannot avoid
liability under section 5 of the FTCA by showing that he acted in good faith because the statute
does not require an intent to deceive. See Orkin Exterminating Co. v. FTC, 849 F.2d 1354, 1368
(11th Cir. 1988); Curtis Lumber Co. v. Louisiana Pacific Corp., 618 F.3d 762, 779 (8th Cir.
2010) (collecting cases). In any event, the fact that a defendant operated under a state issued
license has no bearing on whether the defendant engaged in “deceptive acts.” Neither contention
gives rise to a genuine issue of material fact. Accordingly, the district court did not err in
granting summary judgment for the FTC on those grounds.


                                               7
consideration in advance of obtaining a loan or other extension of credit when the

seller or telemarketer has guaranteed or represented a high likelihood of success in

obtaining or arranging a loan or other extension of credit for a person.” 16 C.F.R.

§ 310.4(a)(4). Based on the undisputed facts, the defendants violated

§ 310.4(a)(4) by representing to consumers that they would be approved for a

credit card upon paying a $200 advance fee for the card. The district court’s grant

of summary judgment was not improper.

                                          B.

      Defendants Deering, Guarino, and Buschel, Jr. also contend that the district

court erred by finding, as a matter of law, that they were liable in their individual

capacities. An individual may be held liable under the FTCA for corporate

practices if the FTC shows “that the individual defendants participated directly in

the practices or acts or had authority to control them . . . . The FTC must then

demonstrate that the individual had some knowledge of the practices.” FTC v.

Gem Merch. Corp., 87 F.3d 466, 470 (11th Cir. 1996) (alteration in original)

(quotation marks omitted).

      Defendants Deering and Buschel, Jr. argue that the district court erred in

concluding that they participated in or “had authority to control” the corporate




                                           8
entities’ illegal acts.3 The evidence shows that Deering was a manager of USA

Financial. In that capacity, he signed checks and an application for telephone

service on behalf of the corporation. The evidence also shows that Buschel was

listed as the vice president of American Financial in bank documents. Buschel

also signed bank applications and resolutions on the corporation’s behalf. In their

capacity as manager and vice president, and as demonstrated by their conduct,

Deering and Buschel had the “authority to control” the corporate entities’ acts.

For that reason, the district court did not err in imposing individual liability.

                                              C.

       American Financial contends that the district court lacked authority under

section 13(b) to issue a permanent injunction against it. Section 13(b) of the

FTCA, 15 U.S.C. § 53(b), provides that “in proper cases the [FTC] may seek, and

after proper proof, the court may issue, a permanent injunction.” See Amy Travel

Serv., Inc., 875 F.2d at 571 (explaining that “Section 13(b) is often used by the

FTC to pursue violations of section 5 of the FTCA or other violations of


       3
          Defendants Deering, Guarino, and Buschel, Jr. also argue that the FTC failed to
establish a FTCA § 5 violation and therefore individual liability was improper. See FTC v. Amy
Travel Serv., Inc., 875 F.2d 564, 573 (7th Cir. 1989) (explaining that an individual may be held
liable under the FTCA for corporate practices only after corporate liability is established). We
have already determined that the defendants’ conduct violated FTCA § 5. This derivative
argument is therefore no longer viable.


                                               9
statutes”). In this case, the district court entered a permanent injunction

prohibiting the defendants from engaging in conduct that would violate section 5

of the FTCA or any provision of the TSR.

      American Financial argues that the district court erred by granting a

permanent injunction under § 13(b) based on past violations of the FTCA or TSR

that ceased before the FTC brought suit and have not been shown likely to recur.

See FTC. v. Evans Products Co., 775 F.2d 1084, 1087–88 (9th Cir. 1985) (holding

that a district court may not issue a preliminary injunction under § 13(b) to remedy

past violations that have not been shown likely to recur). According to the

undisputed facts, American Financial ceased its deceptive practices in late 2007.

The FTC’s complaint was filed on May 12, 2008. American Financial asserts that

the district court failed to make a finding that there was a reasonable likelihood

that its violations would recur. Accordingly, American Financial argues that the

district court’s issuance of a permanent injunction was improper.

      In this case, the district court enjoined American Financial from engaging in

future violations of the FTCA and TSR even though its unlawful conduct had

ceased. Under those circumstances, permanent injunctive relief is appropriate if

“the defendant’s past conduct indicates that there is a reasonable likelihood of

further violations in the future.” SEC v. Caterinicchia, 613 F.2d 102, 105 (5th Cir.

                                          10
1980) (quoting SEC v. Blatt, 583 F.2d 1325, 1334 (5th Cir. 1978)).4 The district

court concluded that permanent injunctive relief was necessary to prevent future

violations. The court found that “the transformation of Capital Financial into

American Financial, and American Financial’s transformation into USA

Financial” indicated a reasonable likelihood of future violations. We agree. The

defendants’ formation of new corporate entities to facilitate their violations of the

FTCA and TSR demonstrates an unwillingness to comply with the law. The

district court therefore did not err in issuing a permanent injunction.

                                              D.

       In July 2008, the defendants agreed to, and the district court entered, a

“Stipulated Preliminary Injunction with Asset Freeze and Appointment of

Receiver.” After granting summary judgment in favor of the FTC, the district

court entered an order keeping the asset freeze “in effect until the Defendants have

made full payment of the monetary judgment.” The defendants contend that was

error because the FTC failed to show a likelihood of asset dissipation if the asset

freeze was not maintained.

       As an incident to its express statutory authority under section 13(b) of the


       4
         In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), we
adopted as binding precedent all decisions of the former Fifth Circuit handed down before
October 1, 1981.

                                              11
FTCA, a “district court has the inherent power of a court of equity to grant

ancillary relief, including freezing assets and appointing a Receiver.” FTC v. U.S.

Oil & Gas Corp., 748 F.2d 1431, 1432 (11th Cir. 1984). Congress intended to

give district courts “authority to grant any ancillary relief necessary to accomplish

complete justice,” including freezing assets. Id. at 1434 (quoting FTC v. H.N.

Singer, Inc., 668 F.2d 1107, 1113 (9th Cir. 1982)). In this case, the frozen assets

were profits from the defendants’ illegal activities. Maintaining the asset freeze

until the monetary judgment was satisfied was necessary to “accomplish complete

justice.” See CSC Holdings, Inc. v. Redisi, 309 F.3d 988, 996 (7th Cir. 2002)

(“Since the [frozen] assets in question here were profits the [defendants] made by

unlawfully stealing [the plaintiff’s] services, the freeze was appropriate and may

remain in place pending final disposition of the case.”). The district court’s

imposition of the asset freeze was not error.

                                          E.

      Finally, the defendants assert in their brief that the district court erred in

awarding consumer redress in the amount of $17,300,509.00. However, the

defendants fail to explain why the district court’s award was erroneous. “We

routinely decline to address such cursory arguments, and this case presents no

exception.” United States v. Belfast, 611 F.3d 783, 821 (11th Cir. 2010); United

                                          12
States v. Gupta, 463 F.3d 1182, 1195 (11th Cir. 2006) (“We may decline to

address an argument where a party fails to provide arguments on the merits of an

issue in its initial or reply brief. Without such argument the issue is deemed

waived.”). We therefore decline to address this issue.

                                         F.

      For all of these reasons, we affirm.

      AFFIRMED.




                                         13
