COMPLAINT IN EQUITY (WITH NOTICE TO PLEAD).
John J. Calabro, Deputy Atty. Gen., Ernest D. Preate, Jr., Atty. Gen., John E. Kelly, Bureau of Consumer Protection, Philadelphia, for Com. of Pa.
Norman F. Caplan, Langhorne, for First Financial Sec., Inc. and James E. Farrior.
Crumlish, Jr., President Judge, and Barry (p.) and McGinley, JJ.*fn*
[ 128 Pa. Commw. Page 583]
Before us is a motion for post-trial relief filed by the Commonwealth, acting by Attorney General Leroy S. Zimmerman, through the Bureau of Consumer Protection (Commonwealth) seeking to vacate a decree nisi entered by this Court which concluded that defendants First Financial Security, Inc. (FFS), James E. Farrior, President of FFS (Farrior) and Frank May, Chairman of the Board of FFS (May) have not violated any of the provisions of the Unfair Trade Practices and Consumer Protection Law (Consumer Law)*fn1 and requesting that this Court enter an order permanently enjoining the methods, acts and practices of the defendants in this Commonwealth.
On July 1, 1988, the Commonwealth filed a complaint in equity seeking to restrain the methods, acts and practices of FFS and its principal officers, Farrior and May. On August 11, 1988, the Commonwealth and the defendants entered into a consent petition for a preliminary injunction which was approved by this Court.
This Court subsequently held a hearing on the Commonwealth's motion for a permanent injunction. On February 17, 1989, Senior Judge Lehman entered a decree nisi denying the Commonwealth's motion for a permanent injunction and dissolving the preliminary injunction which had been entered by mutual consent.
The Commonwealth filed a timely motion for post-trial relief alleging this Court erred in concluding that defendants FFS, Farrior and May did not violate the Consumer Law. Specifically, the Commonwealth contends that defendants have: 1) established and promoted a pyramid club in violation of Section 2(4)(xiii) of the Consumer Law;*fn2 2)
[ 128 Pa. Commw. Page 584]
marketed their program in a manner which is otherwise in violation of Section 2(4)(xvii) of the Consumer Law;*fn3 and 3) failed to register to do business in the Commonwealth in violation of Sections 201(4)(ii), (iii) and (xvii) of the Consumer Law.*fn4
In a decision accompanying the decree nisi, this Court, per Senior Judge Lehman made the following findings of fact:
1. The plaintiff is the Commonwealth of Pennsylvania, acting by Attorney General LeRoy S. Zimmerman, through the Philadelphia office of the Bureau of Consumer Affairs.
2. Defendant, First Financial, is a registered Georgia corporation with a principal place of business located in Atlanta, Georgia.
[ 128 Pa. Commw. Page 5853]
. First Financial is not registered to do business in this Commonwealth as required by the Business Corporation Law.
4. Defendant James E. Farrior, an adult individual, is the President of First Financial.
5. Defendant, Frank May, an adult individual, is the chairman of the board ...