Federal Trade Commission v. John Beck Amazing Profits, LLC

NOT FOR PUBLICATION
FILED
UNITED STATES COURT OF APPEALS
MAR 03 2016
FOR THE NINTH CIRCUIT MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FEDERAL TRADE COMMISSION, No. 12-56665
Plaintiff - Appellee, D.C. No. 2:09-cv-04719-JHN-CW
v.
MEMORANDUM*
JOHN BECK AMAZING PROFITS, LLC,
a California limited liability company,
Defendant,
and
JOHN BECK, an individual,
Defendant - Appellant.
Appeal from the United States District Court
for the Central District of California
Jacqueline H. Nguyen, District Judge, Presiding
Argued and Submitted February 9, 2015
Pasadena, California
Before: CALLAHAN, WATFORD, and OWENS, Circuit Judges.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Page 2 of 3
1. No genuine issues of material fact precluded the district court from
granting summary judgment to the Federal Trade Commission (FTC).
First, no reasonable jury could fail to find that defendant John Beck
“‘participated directly’ in the acts in question.” FTC v. Garvey, 383 F.3d 891, 900
(9th Cir. 2004) (quoting FTC v. Publishing Clearing House, Inc., 104 F.3d 1168,
1170 (9th Cir. 1997)). Beck concedes that he appeared in infomercials as the John
Beck product’s spokesman and that he wrote at least some of the materials sent to
consumers, which were clearly misleading. (Beck does not argue otherwise.)
Second, the undisputed facts establish that Beck was at least recklessly
indifferent to the truth or falsity of the misrepresentations he made. See id. Beck
starred in an infomercial in which he touted how “easy” it was to “purchase”
properties for “pennies on the dollar” using his tax-sale real estate system, stating
that the system “sounds too good to be true.” But dozens of consumer witnesses
testified that it was “difficult or impossible” to find tax sales in their area or earn
substantial money using the system, and less than two percent of consumers made
any money at all. Plus, Beck admitted that he purchased homes using his system
“very infrequently,” that he knew of fewer than five individuals who had acquired
title to homes like the ones in the informercials using his system, and that
consumers needed to take elaborate and time-consuming steps before purchasing
Page 3 of 3
properties at tax sales. Beck’s bare assertion that his statements were “accurate in
the context of the materials he, himself, had authored” does not undermine the
district court’s conclusion that he was incapable of substantiating his
representations. See Nigro v. Sears, Roebuck & Co., 784 F.3d 495, 497 (9th Cir.
2015); Addisu v. Fred Meyer, Inc., 198 F.3d 1130, 1134 (9th Cir. 2000).
2. For the reasons stated in FTC v. Gugliuzza, __ F.3d __ (9th Cir. 2016),
the district court did not abuse its discretion in imposing $113,374,305 in equitable
monetary relief. Even though that amount exceeds the unjust gains Beck
personally received, it was permissible to impose liability for that amount jointly
and severally under the FTC Act.
AFFIRMED.