TelexFree civil action case filed in Brazil
Following the business crippling injunction won against TelexFree, Public Prosecutors in Acre have followed up with a civil lawsuit filed against the company.
Alleging that TelexFree is a Ponzi scheme, the case was filed in the 2nd Civil Court of Rio Branco and is being heard by Judge Thais Borges. As is required when all public civil action cases are filed in Brazil for the benefit of consumer-awareness, Judge Borges published the notice last Monday.
TelexFree have presented their defense and I am currently hearing from the Public Prosecutors.
Then I will evaluate whether any further evidence is required to be produced, if it is, I will request it produced, if not I can pass judgement.
The notice is valid for twenty days, indicating that one way or another the case will be resolved by Saturday the 21st of September (more likely to be either Friday the 20th or Monday the 23rd).
Update 7th September 2013 –After some initial confusion it appears that the twenty day period is granted to allow consumers to respond to the case.
After the twenty day period the case will progress forward with the further presentation of evidence (if required as per the Judge’s comments above) /end update
In continued attempts to get the injunction against the company lifted, thus far TelexFree have presented no less than thirteen separate defences in Brazilian courts, with each having been rejected.
Having not seen the defense filed in the civil action case myself I can’t say whether or not a defense they have already used has been recycled for the case. One would think after thirteen lost appeals that the options left open to TelexFree to defend their business model and compensation plan would be all but exhausted.
In the past TelexFree’s lawyers have claimed that ‘should the company spend a few more days being prohibited from signing up new investors, they would have no money to pay the old ones‘.
Meanwhile TelexFree and its Brazilian affiliates don’t appear to be confident in how the Acre civil action (and no doubt subsequent criminal action) will turn out.
In addition to top Brazilian TelexFree affiliates publishing YouTube videos in which they urge their downlines to create new American TelexFree affiliate accounts to continue to invest in the company, last week an address in the UK quietly popped up on the Brazilian Portuguese language portal of the TelexFree website:
As of yet the company has made no official announcement explaining why the address appeared. Prior to the publication of the address, TelexFree wasn’t known to have any publicly known executive presence in the UK.
With James Merril and Carlos Wanzeler still currently hiding out in the US, perhaps Carlos Costa is planning to announce an extended European vacation over the next 20 days.
Stay tuned…
Twenty days for a court is 4 weeks, each with 5 court days.
You can add 8 days, but I believe the Court already has set a date for trial to September 24th. It was mentioned somewhere when the appeal to the Superior Court was denied on August 28th.
UK not a real business. It’s just a registration address.
Just for grins, here’s who TelexFree shares address with:
(WARNING: NSFW)
erintaylorsins(dot)com/contact/
Address at the bottom
(hint: it’s an escort service by “all American soccer mom”)
So that’s where my “It’s Deja Vu once again” feeling came from when I saw the internet address. 🙂
The practical implication of the 20 calendar day notice is that it gives interested parties (the public) a minimum of 20 days notice that a trial is scheduled.
Portuguese news outlets inform us that Ympactus conducts business under the trade name of Telexfree.
Ympactus and its owners are subject to truly substantial per day/per offense fines if they breach the injunction.
Because of this it seems highly unlikely that any new recruits are being enrolled though Ympactus.
Ympactus has been shutdown but Telexfree has reemerged.
It is actually about “Court Days”, not about “Calendar Days”. The June 18th injunction had a 30 day deadline to file a charge sheet. The deadline went out after 6 weeks (42 days), at the end of July or beginning of August.
The Public Prosecutor filed a charge sheet around July 29th, within the deadline but too close to the next Court day to handle the case within the first week.
The Court in Acre has used “days” for each and every deadline, e.g. 10 days to file an appeal, 20 days to respond to the current civil action, 30 day deadline for the charge sheet. They are all about “Court days”, not about “Calendar days”.
The current Civil Action is probably about an extension of the injunction, e.g. a shutdown of the website. A shutdown is simply about ordering the defendants to something (e.g. give the control of the website to the Court). It can be done if the website has been involved in illegal activities, e.g. allowing Brazilians to sign up as promoters through other countries.
It will be a “constructed theory” if Costa, Merrill and Wanzeler claim TelexFree USA is an independent legal entity not included in the case. The case isn’t about which ENTITY Brazilians signed up to or in which country. It’s about the illegal ACTIVITIES.
I have absolutely no idea what you are talking about here.
In some instances this is true but in the case of notices to the public calendar days apply. That is what we are talking about…. notice to the public.
The recent notice was issued on Sept. 2 and if you add 20 calendar to that you will note that a trial on the 24th is AT LEAST 20 calendar days later than the notice date.
If however you count Court days between Sept 2 and Sept 24 there are only 16
This is pure guesswork on your part, exceedingly poor guesswork at that. It appears that the trial (and it should be very short) on the 24th will consider, then find Ympactus was a ponzi scheme and force bankruptcy, dissolution or Receivership on the company. The temporary injunctions have served their purpose. Whatever wild assumptions you have to the contrary will be found wanting.
Unfortunately you do not yet comprehend that injunctions are levied against real persons (Ympactus is a person by legal definition) It is Ympactus that is enjoined-prohibited from taking the specific actions we have been discussing. Unless the prosecutor of Acre can prove that Ympactus is running the Telexfree website and signing up new members it is a dead issue and not worthy of consideration on the 24th.
Brazilian Federal Police investigates Telexfree transactions in the US:
http://gazetaonline.globo.com/_conteudo/2013/09/noticias/dinheiro/1459545-policia-federal-apura-movimentacao-da-telexfree-nos-eua.html
“Court days” = 5 days per week. “Calendar days” = 7 days per week”. The Court in Acre has always used “days” in all its public notices. It has never been about calendar days before now.
“Poor guesswork” is normally based solely on people’s own imagination and ideas, so I’m backing up my guesswork with some points.
1. This Civil Action is before the magistrate Judge (the same magistrate Judge who handled the June 18th injunction) = a new case.
2. Carlos Costa published a public statement about Brazilians joining TelexFree in other countries, a few days ago. “That type of behavior is NOT supported by TelexFree Brazil (Ympactus), it has an agreement with TelexFree USA about the Brazilian market.”
I was a little incorrect and unformal. I should have specified something about “extensions of the ACTIONS ordered by the injunction”, rather than extensions of the injunction itself. That injunction was made permanent (replaced by a permanent order, “until the Court decides otherwise”).
Do the math
June 18 day 0 injunction, 30 day deadline for charge sheet
June 25 day 5
July 02 day 10
July 09 day 15
July 16 day 20
July 23 day 25
July 30 day 30 the charge sheet was filed July 29
It doesn’t really matter whether I’m starting on day 0 or day 1. The charge sheet was filed within the deadline.
30 days = 6 weeks = 42 calendar days
20 days = 4 weeks = 28 calendar days
10 days = 2 weeks = 14 calendar days
I do a lot of guesswork, but it’s usually based partly on known facts. You have ignored my point #1, the one about magistrate Judge. This is a NEW civil action, not the old one. It’s probably related to Brazilians joining TelexFree in other countries.
Do the logic? 🙂
The main problem in that thread was your own theory. 🙂
I simply tried to correct your idea about that Brazilians legally could join TelexFree in other countries. All the logic you’ll need is posted in another thread.
If you feel you have a better explanation now after some days then post it in the correct thread. I don’t have time to make all sorts of corrections to your ideas, you must check the original comments.
….All of which is irrelevant when calculating whether a notice given on Sept 2 provides at least 20 days notice for a hearing set for Sept 24th. Such notice does provide 20 calendar days lead time but does not provide 20 working days lead time.
As you calculate it the hearing would have to be later than the 24th, perhaps on the 27th or more …and that is not the case. End.
Thaks for your opinion. I completely disagree.
This is a part of the civil action. calling people who consider themselves defrauded by Telexfree to contact the court and become a part of the action
It’s more likely to inform people about that it’s also illegal to join TelexFree in other countries.
Civil Action is typically “Government vs. defendants” = Public Prosecutor against the 5 defendant in this case. They normally don’t want thousands of people to “join” a case like that.
They may call in witnesses and collect testimonies, subpoena parties for disclosure of information, and other pre-trial actions.
The notice was published by the Court itself, not by the PP. It’s probably a standard procedure, part of the Court’s normal procedures.
No doubt that an event of such general interest should be open to the public (that is the reason for the notice) but I do not think, individuals will be allowed to address the court unless they are called as direct witnesses.
To do otherwise would create a circus atmosphere and the impressions of the promoters is not important at this juncture.
In the US victims are allowed to address the court prior to the convicted being sentenced but otherwise they are relegated to spectators unless called to testify.
For illustration purposes only.
@Brazilian
Thanks for the update and good to see their onto the geographical fraud. It’ll be interesting if they engage the help of US authorities to sort it out.
Let’s think this through. The same Judge is handling the same subject matter, brought by the same plaintiff against the same defendants and that = a new case.
I’d like to see the proof of that.
OK
@Hoss
Just curious. What country do you reside?
If that’s a major part of your logic, then I understand the problem. You’re probably trying to use your brain rather than checking facts or logics.
Thaís Queiroz Borges de Oliveira Abou Khalil is the only “Juiza de direito Titular” in 2nd Civil Chamber of Commerce (Juíza de Direito Titular da 2ª Vara Cível da Comarca de Rio Branco).
A new case (e.g. Civil Action) will first go to her. It will NOT go to Family Court, Labour Court, Infant Court, 1st Chamber of Commerce, all the Criminal Chambers, Special Court, courts in other districts, etc.
It’s a 1st level Court, with 1 Judge. The July 8 / August 12 hearings were held before 3 Judges, a 2nd level Court. 3rd level Courts are the Superior Court STJ and the Supreme Court STF.
She will handle a new case and pass a judgement. It can be reviewed by a Court Judge. It can be appealed to the 2nd level Court, and then to the 3rd level Court (STJ).
You can look at her own words and see how it fits within your theory about a fixed date September 24th …
Your 20 calendar days ends on Sunday 22nd. She will probably not start looking at the case before Monday 23rd, and evaluate whether any further evidence is required.
She will probably have a few hours left on Monday to request and collect further evidence, and then she will pass a judgement the same day. The next day, Tuesday 24, the case will go to trial before the 2nd level Court.
That was your logic, not mine.
I am Brazilian and lawyer. The 20 days is just the losers qualify in action. It is a rule of the Code of Consumer Proteccion of Brazil (one of the most modern in the world).
The next phase will be the presentation and analysis of evidence, expertise, testimonials, etc.. Judgment of Civil Accion will occur only here a long time, probably next year. (excuse me, but do not know how to write correctly in english).
Thanks for the clarification Alberto. I’ve updated the article with your information.
someone should go here http://www.facebook.com/groups/555770514443720/ and put the ponzi pimps in their place, faith sloan and her cronies are running rampant in there
Taken from the Facebook page linked to above:
Paging the SEC to aisle four…
Oz, your last update is right. This announcement is just a formality that obliges the court to make public that there is a civil action going on.
Also, it means Telexfree clients or promotores who feel were damaged by the business can report to the same court now. This announcement will remain posted for 20 days, but trial has absolutely no date set yet.
About the UK addess, I’m intrigued that no one in Brazilian is questioning that. Even if it’s a virtual address, the fact that the company put that on the website means they have, somehow a representation in UK, even if it’s “fake”.
What I mean by that is that now UK authorities should investigate that too. I’m sure no country wants any branch of a ponzi registered in their soil. But why did they change that? THat’s what I wanted to know…
By the way, I’m in US today, and for me the website with the American flag also shows the same UK address.
I asked for proof and you gave an interpretation of what you assume I meant, which is to say you provided no proof…and also demonstrated that you do no understand what I meant either.
Juiz Thaís Queiroz Borges de Oliveira Abou Khalil (Judge Thais Borge) rendered the injuction in Acre. Then came a short detour through the appeals process based on that injunction (you followed the appeals closely)
Now the proceedings are about to recommence back in Rio Brancos, Acre where Judge Thais Borges will again preside over the same Civil Action that was originally brought by prosecutors in that state.
A 20 day Notice was provided to the public concerning the upcoming hearing in accordance with the Consumer Protection laws and the public is entitled to attend, but nothing Borges said (nor does common sense infer) that the general public is being asked to provide testimony or opinion. To the contrary, she directly said that she has heard evidence from the defendants and is consulting with prosecutors prior to the hearing. She also said that if she needs further information she will ask for it, but that she may also render immediate judgment…meaning that there is no requirement for a “trial.”
Therefore, I think she will quickly render judgment in favor of the prosecution on the original Civil Complaint.
Interesting. Yes that makes sense. Is it like an advertisement that has to be run for 20 days?
That makes sense too. If there is no dispute over the facts there is no need for a trial. Judge Borge can rule on elements of law immediately.
Judge Borges:
How can you be so certain there will be a trial? Isn’t the legality of Telexfree an matter of law rather than fact?
I’ll try to follow your logic “point by point”.
1. Judge Thais Borge ordered a temporary injunction on June 18, with a 30 day deadline to file a charge sheet.
I followed most of it. All the denied or rejected appeals are probably not important right now. But I’m filling in some missing parts.
2. The charge sheet was filed on July 29. The hearing for making the injunction permanent “until decided otherwise by Court” was on August 12th.
3. The decision about making it permanent was appealed to the Superior Court on August 13, the appeal was denied on August 28th.
4. A new type of appeal was filed on August 29. Vague news reports indicates it was filed to the Court in Acre, but addressed to the Supreme Court. That’s typically about jurisdiction issues or Constitutional issues, a type of complaint aganst the lower Court to the highest one.
We know very little about that appeal.
The case has gone on for more than two months, the injunction was made permanent on August 12 by full Court (3 Judges), has been made final by the Superior Court, by denying an appeal on August 28.
5. And now the case goes back to the first Judge, so she can collect evidence from the parties and make a judgment.
6. 20 day notice, public is entitled to attend. Got it.
I have already covered most of that.
7. No requirement for a trial.
No trial is already covered in point #7. She will make an “office decision” in her own office, “quickly render judgment”. That partly explains the 20 day notice to the public, the public is entitled to attend her office and see how she’s making a quick judgment.
I managed to follow your logic all the way. I only added a few points to make it easier to identify the others (in the parts where you were rather vague, e.g. “short detour through the appeals system”).
Well I think we have exhausted this subject for now. Let’s see what happens next.
I had some trouble understanding some of the logics …
Some Court dates, types of Court:
June 18: First instance court (vara)
Temporary injunction, Judge Thais Borges
June 24: First instance court (vara)
Appellate review by another Judge
July 8: Second instance court (TJ)
Appeal denied.
July 29: Second instance court (TJ)
Charge sheet filed within deadline.
August 12: Second instance court (TJ)
Temporary injunction replaced by permanent injunction
August 28: Third instance court (STJ)
Appeal denied.
September 2: First instance court (vara)
20 day notice, Civil Action. Judge Thais Borges.
From my viewpoint, the last date there must be about something new. A first instance court doesn’t have the correct jurisdiction to handle a case when it already has been handled by a higher court.
There’s a flaw in the logics there, e.g. in the idea that Judge Thais Borges is “personally assigned” to the TelexFree case, and that it has to be sent from the Superior Court down to her for collecting evidence and passing a final judgment.
All other steps in the process seems logical and rational, but the last point looks like a “constructed theory”.
This article is actually about the September 2nd notice / Civil Action. I just tried to make it easier to understand by listing the most important appeals and Court hearings leading up to it.
I don’t think anyone have managed to keep track of all the different appeals or hearings (12, 13 or 14 total). An overview for the most important ones will make the case become less confusing.
If by “higher court” you mean the appellate division then as you know the appeal was heard at that level and denied. Where do you expect the remainder of the issues to be decided? Certainly not at the appelate level since they only review what has happened at a lower court.
No. The case continues on from where it left off and that is in Rio Branco, Acre in front of Borge.
As you are aware her first ruling was the temporary injunction and that implied only that there was sufficient cause to enjoin the defendants from continuing their practices. That being accomplished I suggest its time that she will address the meat of the complaint against the defendants and make a final determination under the law
IM(very)HO, what we’re seeing is the deliberate use of a legal system to delay the inevitable.
In my experience it’s not unusual in such cases, ESPECIALLY when a HYIP ponzi operator in all likelihood has access to a multi million dollar fighting fund.
By my reckoning, any half decent ponzi fraudster should be able to string things out for 3 to 4 years without trying too hard.
“Though the mills of God grind slowly, yet they grind exceeding small; Though with patience stands He waiting, with exactness grinds He all.”
….or “the wheels of justice grind slowly but they grind exceedingly fine.”
“decent ponzi fraudster?” sounds like an oxymoron to me.
It’s a commonly used expression in Australia.
“Half decent” translates into something along the lines of: “If he was only half good at his job, he could string things out for 3 to 4 years with little effort”
Did you pick that up from the MMG forum, from the TelexFree thread? … and googled the original? 🙂
I think I get the idea. A worker who is half decent isn’t trying very hard or isn’t particularly efficient.
Not from the Forum you mentioned. I thought of and searched for the phrase “the wheels of justice” etc. and there were many results to consider.
Purportedly the traditional ‘God as arbiter of justice’ passage I quoted comes from the Bible and the stripped down version I mentioned comes from Sun Tsu, but I can not vouch for that. I do not recall where I first became aware of it. The concept has been around for a long time.