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Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 7 of 25 Page ID#:135881or (3) otherwise participated in the transfer of assets stemming from the2advertising, marketing, distributing, promoting, or selling of trading or investing3training programs.4J.“Review-Limiting Contract Term” means a standardized contract5term that: prohibits or restricts the ability of a person who is a party to the contract6to engage in a Covered Communication; imposes a penalty or fee against a person7who is a party to the contract for engaging in a Covered Communication; or8transfers, or requires a person who is a party to the contract to transfer, to any other9person any intellectual property rights in a Covered Communication, with the10exception of a non-exclusive license to lawfully use a Covered Communication11about a Defendant’s goods or services.121314ORDERI.PROHIBITED BUSINESS ACTIVITIESIT IS THEREFORE ORDERED that Defendants, Defendants’ officers,15agents, employees, and attorneys, and all other persons in active concert or16participation with any of them, who receive actual notice of this Order by personal17service or otherwise, whether acting directly or indirectly, in connection with the18advertising, marketing, promoting, or offering for sale of any goods or services, are19preliminarily restrained and enjoined from:20A.Making any Earnings Claim, expressly or by implication, unless the21Earnings Claim is non-misleading, and, at the time such claim is made,22Defendants: (1) have a reasonable basis for the claim; (2) have in their possession23written materials that substantiate that the claimed earnings are typical for24consumers similarly situated to those to whom the claim is made; and (3) make the25written substantiation available upon request to the consumer, potential purchaser,26the Monitor, or the FTC;2728B.Making any claim, expressly or by implication, about (1) the time oreffort typically required for consumers to attain proficiency in deploying7

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 8 of 25 Page ID#:135891Defendants’ trading strategy; (2) the time or effort typically expended by2consumers using Defendants’ trading strategy to achieve substantial income; or (3)3the amount of capital typically needed by consumers using Defendants’ trading4strategy, unless the claim is non-misleading, and, at the time such claim is made,5Defendants: (a) have a reasonable basis for the claim; (b) have in their possession6written materials that substantiate that the claim is typical for consumers similarly7situated to those to whom the claim is made; and (c) make the written8substantiation available upon request to the consumer, potential purchaser, the9Monitor, or the FTC.10C.Misrepresenting or assisting others in misrepresenting, expressly or by11implication, that instructors of Defendants’ trading strategy are active traders who12have amassed substantial wealth through trading in financial markets; and13D.Misrepresenting or assisting others in misrepresenting, expressly or by14implication, any material fact to consumers concerning any good or service,15including, but not limited to: the total cost; any refund policy; any material16restriction, limitation, or condition; or any material aspect of its performance,17efficacy, nature, or central characteristics.18II.19PROHIBITION ON RESTRICTION OF CONSUMERS’ SPEECHIT IS THEREFORE ORDERED that Defendants, Defendants’ officers,20agents, employees, and attorneys, and all other persons in active concert or21participation with any of them, who receive actual notice of this Order by personal22service or otherwise, whether acting directly or indirectly, in connection with the23advertising, marketing, promoting, or offering for sale of any goods or services, are24preliminarily restrained and enjoined from:25262728A.Offering, attempting to enforce, or asserting the validity of, anyReview-Limiting Contract Term; andB.Including in a contract any provision that (a) prohibits or restricts theability of any person who is a party to the contract to communicate, in any way,8

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 9 of 25 Page ID#:135901with the Commission or any other law enforcement entity, or (b) imposes a penalty2or fee against any person for communicating, in any way, with the Commission or3any other law enforcement entity.4III.5PROHIBITION ON COLLECTION OF LOAN PAYMENTSIT IS FURTHER ORDERED that for any loan owned by any Corporate6Defendant which was issued to a purchaser of Defendants’ trading or investing7training programs prior to the date of entry of this Order, Defendants, Defendants’8officers, agents, employees, and attorneys, and all other persons in active concert9or participation with any of them, who receive actual notice of this Order, whether10acting directly or indirectly, are preliminarily restrained and enjoined from:1112A.Attempting to collect or collecting past due loan payments through acollection agency;13B.14or late payment;15C.16Levying or assessing any penalties, such as late fees, for non-paymentLevying or assessing any interest beyond the amount that would bedue if all loan payments due after this Order were made as scheduled;17D.Referring, selling, assigning, or otherwise transferring such loans; and18E.Reporting negative information to a consumer reporting agency that19assembles or evaluates consumer credit information for the purpose of furnishing20reports to third parties.21Provided, however, that this Section does not bar receipt of payments22voluntarily submitted by consumers (including consumers who purchased23Defendants’ trading or investing training programs prior to the date of entry of this24Order), including payments submitted via pre-arranged electronic funds transfer or25like method of payment. Such payments received from consumers are subject to26the asset freeze provisions of Sections VII and VIII.27289

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 10 of 25 Page ID#:1359112IV.PROHIBITION ON RELEASE OF CUSTOMER INFORMATIONIT IS FURTHER ORDERED that Defendants, Defendants’ officers,3agents, employees, and attorneys, and all other persons in active concert or4participation with any of them, who receive actual notice of this Order, whether5acting directly or indirectly, are hereby preliminarily restrained and enjoined from6selling, renting, leasing, transferring, or otherwise disclosing, the name, address,7birth date, telephone number, email address, credit card number, bank account8number, Social Security number, or other financial or identifying information of9any person that any Defendant obtained in connection with any activity that10pertains to the subject matter of this Order.111213Provided, however, that Defendants may disclose such identifyinginformation to(1) a law enforcement agency, to their attorneys as required for their defense,14as required by any law, regulation, or court order, or in any filings, pleadings or15discovery in this action in the manner required by the Federal Rules of Civil16Procedure and by any protective order in the case.17(2) companies that provide services to Corporate Defendants related to18trading or investing training programs, to the extent that such persons have19provided written consent for their identifying information to be provided to such20companies. Such written consent will not be valid for purposes of this Order21unless Corporate Defendants have identified to the person the name of the22company that will receive the identifying information and the reason the23information is being shared, prior to the person’s execution of the written consent.24Corporate Defendants must maintain such written consent for the duration of this25Order.26272810

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 11 of 25 Page ID#:135921V.2PRESERVATION OF RECORDSIT IS FURTHER ORDERED that Defendants, Defendants’ officers,3agents, employees, and attorneys, and all other persons in active concert or4participation with any of them, who receive actual notice of this Order, whether5acting directly or indirectly, are hereby preliminarily restrained and enjoined from:6A.Destroying, erasing, falsifying, writing over, mutilating, concealing,7altering, transferring, or otherwise disposing of, in any manner, directly or8indirectly, Documents that relate to: (1) the business, business practices, assets, or9business or personal finances of any Defendant; (2) the business practices or10finances of entities directly or indirectly under the control of any Defendant; or (3)11the business practices or finances of entities directly or indirectly under common12control with any other Defendant; and13B.Failing to create and maintain Documents that, in reasonable detail,14accurately, fairly, and completely reflect Defendants’ incomes, disbursements,15transactions, and use of Defendants’ assets.16VI.17PRESERVATION OF INDIVIDUAL DEFENDANTS’ ASSETSIT IS FURTHER ORDERED that for the pendency of this Order, each18Individual Defendant shall not, directly or indirectly, disburse, gift, spend, transfer,19liquidate, or assign any assets obtained prior to entry of the TRO in this matter20(Docket No. 46, issued February 25, 2020) beyond a cumulative amount of21 25,000 (per Individual Defendant), as authorized by the TRO, until further Order22of the Court. Each Individual Defendant shall not, directly or indirectly, disburse,23gift, spend, transfer, liquidate, or assign any assets obtained after this Order is24entered that are derived from any activity that is prohibited by this Order.25VII. ASSET FREEZE OVER CORPORATE DEFENDANTS2627IT IS FURTHER ORDERED that Defendants, Defendants’ officers,agents, employees, and attorneys, and all other persons in active concert or2811

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 12 of 25 Page ID#:135931participation with any of them, who receive actual notice of this Order, whether2acting directly or indirectly, are hereby preliminarily restrained and enjoined from:3A.Transferring, liquidating, converting, encumbering, pledging, loaning,4selling, concealing, dissipating, disbursing, assigning, relinquishing, spending,5withdrawing, granting a lien or security interest or other interest in, or otherwise6disposing of any assets, wherever located, including outside the United States, that7are:81)9Owned or controlled, directly or indirectly, by any CorporateDefendant;102)11Held, in part or in whole, for the benefit of any CorporateDefendant;123)13In the actual or constructive possession of any CorporateDefendant; or144)Owned or controlled by, in the actual or constructive possession15of, or otherwise held for the benefit of, any corporation,16partnership, asset protection trust, or other entity that is directly17or indirectly owned, managed, or controlled by any Corporate18Defendant.19B.Opening or causing to be opened any safe deposit boxes titled in the20name of any Corporate Defendant or subject to access by any Corporate21Defendant; or22C.Incurring charges or cash advances on any credit, debit, or ATM card23issued in the name, individually or jointly, of any Corporate Defendant or any24corporation, partnership, or other entity directly or indirectly owned, managed, or25controlled by any Corporate Defendant other than in the ordinary course of26business. This includes any corporate bankcard or corporate credit card account27for which any Corporate Defendant or Eyal Shachar is, or was on the date that this28Order was signed, an authorized signor.12

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 13 of 25 Page ID#:135941The assets affected by this Section shall include: (1) all assets of the2Corporate Defendants as of the time this Order is entered; and (2) assets obtained3by the Corporate Defendants after this Order is entered if those assets are derived4from any activity that is the subject of the Complaint in this matter or that is5prohibited by this Order.6VIII. EXCEPTIONS TO THE ASSET FREEZE7IT IS FURTHER ORDERED that:8A.Corporate Defendants may collect money from consumers subject to9the limitations of Section III of this Order, and, once received, the provisions of10Sections VII and VIII;111213B.Notwithstanding the provisions of Section VII, above, CorporateDefendants may:1)1415salaries;2)1617Pay employees, other than Defendants, their usual currentPay for the employer’s share of health insurance benefitsalready in effect;3)Pay the current rent on any facility regularly used in the18ordinary course of business, unless the facility is owned,19directly or indirectly, by any Defendant;204)2122independent contractors who serve as regular instructors;5)2324Pay utility payments incurred in the ordinary course ofbusiness; and6)Pay for internet services or other reasonable and necessarypurchases in the ordinary course of business.2526Pay the current monthly or other periodic payment paid to7)To the extent not already authorized, Defendants may submit to27the Court a list of vendors or individuals to seek prior approval28and the basis therefor.13

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 14 of 25 Page ID#:135951Provided, however, that no single or aggregate payment in any month to any2single payee in categories 1) and 4) shall exceed 10,000 without the prior3approval of the Court. Defendants may submit to the Court a list of vendors4or individuals to seek prior approval and the basis therefor.5No later than the 15th day of each month, Corporate Defendants shall file6with the Court a list of payees and the amount of each payment authorized7herein for the prior month. An officer(s) of Corporate Defendants shall8certify the accuracy of the report.9C. Notwithstanding the provisions of Section VII, above, Corporate10Defendants may liquidate or sell assets subject to the following conditions:111) The asset must be sold via an arms-length, commercially12reasonable transaction;132) Such sales may not include selling receivables to Universal14Guardian Acceptance LLC that are derived from sales made by15Corporate Defendants prior to the entry of the TRO entered on16February 25, 2020, Docket No. 46;173) Sales of assets in the amount of 100,000 or greater, or sales of18assets valued at 100,000 or greater, require prior approval of the19Court; and204) Proceeds from the sales of any assets are subject to this Section and21VII of this Order once received.22232425262728IX.DUTIES OF ASSET HOLDERS AND OTHER THIRD PARTIESIT IS FURTHER ORDERED that any financial or brokerage institution,Electronic Data Host, credit card processor, payment processor, merchant bank,acquiring bank, independent sales organization, third party processor, paymentgateway, insurance company, business entity, or person who receives actual noticeof this Order (by service or otherwise) that (a) has held, controlled, or maintained14

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 15 of 25 Page ID#:135961custody, through an account or otherwise, of any Document on behalf of any2Defendant or any asset that has been: owned or controlled, directly or indirectly, by3any Defendant; held, in part or in whole, for the benefit of any Defendant; in the4actual or constructive possession of any Defendant; or owned or controlled by, in5the actual or constructive possession of, or otherwise held for the benefit of, any6corporation, partnership, asset protection trust, or other entity that is directly or7indirectly owned, managed or controlled by any Defendant; (b) has held,8controlled, or maintained custody, through an account or otherwise, of any9Document or asset associated with credits, debits, or charges made on behalf of10any Defendant, including reserve funds held by payment processors, credit card11processors, merchant banks, acquiring banks, independent sales organizations,12third party processors, payment gateways, insurance companies, or other entities;13or (c) has extended credit to any Defendant, including through a credit card14account, shall:15A.Hold, preserve, and retain within its control and prohibit the16withdrawal, removal, alteration, assignment, transfer, pledge, encumbrance,17disbursement, dissipation, relinquishment, conversion, sale, refund, chargeback, or18other disposal of any such Document or asset of any Corporate Defendant, as well19as all Documents or other property related to such assets, except by further order of20this Court.21Provided, however, that this provision does not prohibit an Individual22Defendant from incurring charges on a personal credit card established prior to23entry of this Order, up to the pre-existing credit limit.24Provided further, however, that asset holders may release funds for payments25authorized pursuant to Section VIII. Before the asset holder releases any funds, an26officer of Corporate Defendants shall certify in writing to the entity releasing funds27the amount to be released and that such assets will be used to make payments28authorized by the Court. Defendants shall provide a copy of the certification to the15

Case 8:20-cv-00287-JVS-KES Document 130 Filed 04/02/20 Page 16 of 25 Page ID#:135971FTC at the same time it is provided to the asset holder. If any asset holder contests2or otherwise fails so honor a Corporate Defendant’s certificate, the Corporate3Defendant may apply ex parte to the Court for relief4B.Deny any person access to any safe deposit box, commercial mail5box, or storage facility that is titled in the name of any Corporate Defendant, either6individually or jointly, or otherwise subject to access by any Corporate Defendant;7C.Provide FTC counsel, within three (3) days of receiving a copy of this8Order, a sworn statement setting forth, for each asset or account covered by this9Section:101)The identification number of each such account or asset;112)The balance of each such account, or a description of the nature12and value of each such asset as of the close of business on the13day on which this Order is served, and, if the account or other14asset has been closed or removed, the date closed or removed,15the total funds removed in order to close the account, and the16name of the person or entity to whom such account or other17asset was remitted;183)The identification of any safe deposit box, commercial mail19box, or storage facility that is either titled in the name,20individually or jointly, of any Defendant, or is otherwise subject21to access by any Defendant; and22D.Upon the request of FTC counsel, promptly provide FTC counsel with23copies of all records or other Documents pertaining to each account or asset24covered by this Section, including originals or copies of ac

9 doing business as Online Trading Academy), Newport Exchange Holdings, Inc. (also doing business as Online Trading Academy), NEH Services, Inc. (also doing 11 business as Online Trading Academy), and each of their subsidiaries, affiliates, 12 successors, and assigns. 13 B. “ Co