Appellate Court Unfreezes Small Business Owner’s Assets After Being Wrongly Targeted by FTC

Washington, D.C. – The 11^th Circuit Court of Appeals has ruled to unfreeze in part the assets of our client, Robert Cupo, who owns a small family-run tech support company, Vylah Tec, LLC (“V-Tec”), after the Federal Trade Commission (“FTC”) used misleading evidence to convince the lower court to grant a damaging injunctive order against his company. The ruling rejects the government’s clear overreach in not only freezing assets of the company, but also the joint marital assets of Mr. Cupo and his wife, and the assets of his brother who had no business connection to V-Tec.  Cause of Action Institute (“CoA Institute”) filed an appeal of the district court’s order in September 2017.

CoA Institute Senior Counsel Cynthia Crawford: “The Government attempted to bulldoze Mr. Cupo and his family with punitive financial penalties before they had an opportunity to defend themselves. The preliminary injunction was granted based on faulty and mischaracterized evidence. That’s not due process, and it certainly is not justice. After nine long months of financial hardship, a large portion of the burden has finally been lifted, allowing our client to continue to fight to clear his name.”

The 11^th Circuit found that the district court “did not make sufficient factual findings to support freezing these assets.”

Case Background:

V-Tec provides tech support to customers and also sells third-party antivirus and other data security software. In May 2017, the company’s headquarters was raided by FTC regulators, in conjunction with the Florida Attorney General’s office, on suspicion of “deceptive” sales practices.

To obtain the injunctive order that froze the Cupos’ assets, the FTC in court cited two examples of recorded calls that were both mischaracterized. The Government conceded that it submitted false evidence. Nonetheless, a Florida district court judge granted the injunctive order turning V-Tec’s operation over to a third-party receiver and freezing the assets of Mr. Cupo and several of his family members.

The 11^th Circuit ruling vacates the asset freeze imposed against the assets held jointly by Mr. Cupo and his wife, as well as the asset held by his brother.

The full opinion can be found here.

For information regarding this press release, please contact Zachary Kurz, Director of Communications at CoA Institute: zachary.kurz@causeofaction.org.