Jerry Brown (D)
SACRAMENTO, Calif. (Legal Newsline)-Attorney General Jerry Brown has won a $1.2 million ruling against rip-off artists Gaston Muhammad and Ronna Green of Duluth, Ga., for deceptive business practices.
Nearly a million California business owners received solicitations claiming if they did not pay the $150 for unnecessary corporate minute's services they could lose their corporate status, the attorney general's office said in a statement Friday.
About 986,000 solicitations were sent out between July 2007 and November 2008. They appeared to be a government document, they had an official-looking seal, the name sounded official, corporation numbers, citations to the Corporations Code, and even a Sacramento address. They were made to look like State of California official forms-specifically, the AG's office said.
The defendants had promised to prepare annual minutes for the recipient corporations. They made up dates, meeting places, participant and the actions taken.
A suit was filed by Brown in May 2008 in San Diego Superior Court.
The defendants were charged with violating the false advertising statute, deceptive mailing statute, phony billing statute, and unfair business practices within the Business and Professions Code.
On June 22, a San Diego Superior Court ruled that all four statutes had been violated.
The court ordered restitution of $200,000 to be paid by the defendants and imposed civil penalties of $986,000. It also issued permanent injunctions requiring the defendants to comply with the law and barred them from engaging in the business of providing corporate minutes in California for five years. The state was also awarded the cost incurred by prosecuting the case.
Brown said, "In reality, this was a massive scam costing California small business owners hundreds of thousands of dollars."