Millennium Communications & Fulfillment, Inc. v. OFFICE OF ATTY. GEN.

• Decision Date: 19 July 2000
• Docket Number: No. 3D99-1423.,3D99-1423.
• Citation: 761 So.2d 1256
• Court: Florida District Court of Appeals
• Parties: MILLENNIUM COMMUNICATIONS & FULFILLMENT, INC. & Advanced Marketing and Research, Inc., Appellants, v. OFFICE OF the ATTORNEY GENERAL, DEPARTMENT OF LEGAL AFFAIRS, STATE OF FLORIDA, Appellee.

761 So.2d 1256

MILLENNIUM COMMUNICATIONS & FULFILLMENT, INC. & Advanced Marketing and Research, Inc., Appellants, v. OFFICE OF the ATTORNEY GENERAL, DEPARTMENT OF LEGAL AFFAIRS, STATE OF FLORIDA, Appellee.

No. 3D99-1423.

District Court of Appeal of Florida, Third District.

July 19, 2000.

Law Offices of R. Stuart Huff and Mark L. Mallios, Coral Gables; Andrew Cove (Hollywood), for appellants.

Robert A. Butterworth, Attorney General and Sylvie Perez-Posner, Assistant Attorney General, for appellee.

Before SCHWARTZ, C.J., and GREEN and FLETCHER, JJ.

GREEN, J.

Millennium Communications, Inc. and Advanced Marketing and Research, Inc. (collectively "Millennium") appeal a temporary injunction entered in favor of the Department of Legal Affairs ("Department") pursuant to The Florida Deceptive and Unfair Trade Practices Act ("FDUTPA"), section 501.207(1)(b), Florida Statutes (1997).¹ For the reasons which follow, we reverse.

I BACKGROUND

Millennium is a Florida corporation which is licensed by a Nevada company, Continental Consumer Credit Corporation ("Continental") to advertise and promote Continental's Advantage credit card program in all states except Florida, Kansas, Wisconsin and North Carolina. This credit card program is a mechanism by which people with poor credit histories can restore their credit worthiness. Essentially, the Continental program allows these consumers to obtain a Continental Advantage card, which can then be used to purchase items from Continental's catalogs. Once these consumers purchase the merchandise from these catalogs and timely pay for the same, Continental makes favorable reports to credit bureaus. This then puts these consumers in a favorable position to apply for other credit cards, including bank cards such as Visa and MasterCard.

THE COMPLAINT

On December 4, 1998, the Department filed a complaint against Millennium seeking an injunction, civil penalties and other statutory relief afforded under FDUTPA. The complaint alleged, among other things, that Millennium, through the use of a postcard mailed around the country, advertised and promoted the ability of consumers with bad credit to obtain a guaranteed credit card.² It was further alleged that once the consumers received the postcard and called the "800" number listed on the postcard, certain representations were made to them either directly or by implication which lead the consumers to conclude that they would be receiving either a Visa or MasterCard type credit card.³

The Department further alleged that after Millennium collected the $129.00 fee, the consumers received their Advantage credit card, along with a package of other materials, including the catalogs and the information on the Orlando trip mentioned in the postcard. These materials disclosed that: (1) consumers cannot automatically qualify for or receive a Visa or Master-Card; and that (2) consumers only become eligible to apply for the Visa or MasterCard by fulfilling "a few basic requirements," to wit:

a) Ordering only from the catalogs received in their packages, as the Advantage credit card can only be used to purchased merchandise in those catalogs;

b) paying a down payment on that merchandise of 50% of the total amount (minimum order from each catalog is $50) upon ordering said merchandise;

c) paying an additional 8% or the total amount for shipping and handling;

d) consumers must charge and pay for $500 (excluding down payments, shipping and handling, vouchers or merchandise gift certificates) on the Continental Advantage credit card, and make six months of timely payments, in order to have their accounts favorably reported to the credit bureau;

e) electronic and certain jewelry items are not available until a satisfactory payment history is established;

f) an additional down payment may be required on certain items g) if consumers pay the down payment with a personal check, their order will not even be processed for 21 days;

h) while the application for the Visa or MasterCard is free of charge, the card itself, if approved, requires the payment of a separate fee over and above the $129.00 fee already paid to Millennium by the consumers; and

i) Millennium does not refund the processing fees.⁴

Finally, the complaint alleged that few, if any, consumers actually received a Visa or MasterCard as a result of purchasing the Advantage card, since few met the aforestated minimum requirements. Based upon its allegations, the Department sought to enjoin Millennium, its agents, employees, or persons who act on its behalf, from engaging in further acts and practices alleged therein; reimbursement to all consumers; and to assess Millennium civil penalties in the amount of $10,000 for each act or practice found to be in violation of chapter 501, part II, Florida Statutes (1997) pursuant to section 501.2075, Florida Statutes (1997).

PROCEDURAL HISTORY

In response to the complaint, Millennium moved to dismiss the complaint on the grounds, inter alia, that FDUTPA, chapter 501 was inapplicable to its transactions in the absence of any allegations that Millennium had marketed its products to Florida residents or that any Florida consumers had been injured or affected by its alleged activities. The Department then filed a motion for temporary injunction, incorporating all of the allegations contained in the complaint and alleging that if the defendants were not enjoined, the number of consumers aggrieved by Millennium's deceptive acts would increase. The Department further stated that it had no remedy at law to protect the consuming public.

Millennium's motion to dismiss was heard and denied. Prior to the hearing on the state's motion for temporary injunction, Millennium moved for judgment on the pleadings for the Department's failure to join Continental as an indispensable party to this proceeding. The Department countered that this action was not an attack upon the terms and conditions of Continental's program per se, but instead was aimed solely at Millennium's failure to adequately disclose the terms and conditions of Continental's program.

The hearing on both the motion for judgment on the pleadings and motion for temporary injunction was then held. At the outset of the hearing, the parties made certain stipulations, namely, that Millennium advertises to people outside the state of Florida; the Department had received 24 complaints from consumers residing outside the state of Florida; and that of the consumers requesting refunds, 1400-1500 consumers had received complete refunds. At the conclusion of the hearing, the trial court denied Millennium's motion for judgment on the pleadings, finding that Continental was not an indispensable party to this proceeding. The court granted the Department's motion for temporary injunction expressly finding the postcard to be deceptive and ordered Millennium to cease and desist from using it. In entering the temporary injunction, the court also ordered the parties to meet with a special master in an effort to draft a revised postcard, subject to the Department's approval, that would fairly disclose to consumers what they would receive and to place a disclaimer on what they would not receive. Further, the new card was to include a street address on the postcard rather than the post office box address previously utilized and to have the sales pitch script conform to the agreed upon postcard. This appeal followed. Millennium essentially contends on this appeal that the trial court erred in granting the temporary injunction because FDUTPA has no applicability to consumers residing outside of the state of Florida. Alternatively, Millennium argues that even if this chapter is found to have applicability to its subject activities, the temporary injunction was still error because its postcard advertisement was not deceptive or misleading. Lastly, Millennium asserts that even if the injunctive order is affirmed, that the part of the order requiring Millennium to revise the postcard, subject to the Department's approval, was error because it constituted an improper delegation of judicial authority to the executive branch.

II

At the outset, we note that injunctive relief is an extraordinary remedy to preserve the status quo, pending a final hearing, which ordinarily should not be granted absent a showing of irreparable harm; a clear legal right to the relief requested or substantial likelihood of success on the merits; an inadequate remedy at law; and considerations of the public interests. See Naegele Outdoor Advertising Co., Inc. v. City of Jacksonville, 659 So.2d 1046, 1047 (Fla.1995)

; Storer Communications, Inc. v. State, Dept. of Legal Affairs, 591 So.2d 238, 239-40 (Fla. 4th DCA 1991); Harvey v. Wittenberg, 384 So.2d 940, 941 (Fla. 3d DCA 1980); see also Escudero v. Hasbun, 689 So.2d 1144, 1146 (Fla. 3d DCA 1997). However, because section 501.207(1)(b) expressly authorizes the Department to seek injunctive relief on behalf of the state, the Department does not have to establish irreparable harm, lack of an adequate legal remedy or public interest. See Storer; Harvey; see also U.S. v. Sene X Eleemosynary Corp., Inc., 479 F.Supp. 970 (S.D.Fla.1979). The Department's sole burden at a temporary injunction hearing under FDUTPA is to establish that it has a clear legal right to a temporary injunction. Moreover, on appeal, we will not reverse an order granting a temporary injunction unless it is found to be a clear abuse of discretion. See Wise v. Schmidek, 649 So.2d 336 (Fla. 3d DCA 1995); Richard v. Behavioral Healthcare Options, Inc., 647 So.2d 976 (Fla. 2d DCA 1994). We conclude that FDUTPA does have applicability to the challenged transactions, but that the Department did not meet its burden to establish a clear legal right to a temporary injunction. Accordingly, the lower court clearly abused its discretion in entering the order under review.

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