United States v. Mylife.com Inc.

I. Background

The Debtor filed a voluntary Chapter 11 petition on September 2, 2022 (the “Petition Date”). Jeffrey Tinsley (“Tinsley”) is the Debtor’s CEO and holds a 49% interest in the Debtor. The Debtor operates a website that allows subscribers to run background checks on individuals. On July 27, 2020 (prior to the Petition Date), the United States of America (the “US”) filed a complaint against the Debtor and Tinsley in the District Court (the “District Court Complaint”), seeking relief for (1) deceptive business practices in violation of § 5(a) of the Federal Trade Commission Act (the “FTC Act”), 15 U.S.C. § 45(a), (2) violation of the Telemarketing Sales Rule (the “TSR”), 16 C.F.R. § 310.3(a)(1)–(2), and (3) violation of the Restore Online Shoppers Confidence Act (“ROSCA”), 15 U.S.C. § 8403 (collectively, the “Consumer Protection Statutes”). See Case No. 2:20-cv-6692-JFW (Central District of California) (the “District Court Action”). On October 19, 2021, the District Court entered summary judgment in favor of the United States [Complaint, Ex. B] (the “District Court Summary Judgment Order”). In a 17-page decision, the District Court found that the Debtor had violated the…