STATE OF FLORIDA OFFICE OF THE ATTORNEY GENERAL AFFAIRS DEPARTMENT OF LEGAL

Transcription

1 STATE OF FLORIDA OFFICE OF THE ATTORNEY GENERAL AFFAIRS DEPARTMENT OF LEGAL IN THE INVESTIGATION OF: AGENCY FILE NO. L RENUEN CORPORATION SDI SOLAR, INC, a wholly owned Subsidiary ofrenuen CORPORATION d/b/aenergy SOLUTIONS OF FLORIDA JEFFREY CHARLES NEMES, Individually and as Chief Executive Officer of RENUEN CORPORATION and SDI SOLAR, INC, a wholly owned Subsidiary ofrenuen COR PORATION d/b/a ENERGY SOLUTIONS OF FLORIDA RESPONDENTS. ASSURANCE OF VOLUNTARY COMPLIANCE FOR RENUEN CORPORATION, SDI SOLAR, INC., AND JEFFREY CHARLES NEMES Pursuant to the provisions of Chapter 501, Part II of the Florida Statutes, Florida's Deceptive and Unfair Trade Practices Act, the Office of the Attorney General, Department of Legal Affairs ("Department"), caused an investigation to be made into certain acts and practices of RenuEn Corporation ("RenuEn"), an active State of Florida Corporation, SDI ~olar, Inc ("SDI"), a wholly owned subsidiary ofrenuen Corporation d/b/a Energy Solutions of Florida, and Jeffrey Charles Nemes, individually, and as Chief Executive Officer of RenuEn Corporation and SDI Solar, Inc (collectively referred to herein as "Respondents").

2 Respondents agree to enter into this A VC in order to resolve the Attorney General's investigation of Respondents, pursuant to Agency Case No. L and Section (6) of the Florida Statutes. The Attorney General, by the signature of her Deputy Attorney General affixed hereto, does hereby accept the instant AVC and in turn terminates the Attorney General's investigation as it concerns Respondents solely as to the acts and practices that were the subject of the investigation by virtue of the authority vested in the Office of the Attorney General, pursuant to Section (6) of the Florida Statutes, and the terms of the instant AVC. I. ATTORNEY GENERAL'S ALLEGATIONS 1.1 Respondent, RenuEn Corporation ("RenuEn"), is an active State of Florida for-profit corporation established in or around 1996, with its principal office located in Singer Island, Palm Beach County, Florida. RenuEn owned, operated and formerly conducted business under the name of SDI Solar, Inc d/b/a Energy Solutions of Florida ("SDI"). 1.2 RenuEn is, or was at one time, in the business of selling, financing and installing residential solar energy products to consumers in the State of Florida. 1.3 Respondent, Jeffrey Charles Nemes, is a natural person who is and/or was registered with the Florida Department of State, Division of Corporations, as the Chief Executive Officer of RenuEn, the parent company of SDI. 1.4 As the Chief Executive Officer of RenuEn, Respondent, Charles J. Nemes, presently, and/or at all times material to the allegations in this A VC, participated in, controlled and/or possessed the authority to control the acts and practices of both RenuEn and SDI and possessed actual and/or constructive knowledge of all material acts and practices complained of herein. 2

3 1.5 Respondent, RenuEn Corporation, acquired SDI Solar, Inc, a self-described renewable energy development, engineering, procurement, and construction (EPC) company, for the purpose of conducting residential solar contracting. 1.6 RenuEn Corporation's stock is, or was at one time, publicly traded overthe-counter (OTC) or off-exchange with the stock symbol: OTC:RENU. 1.7 SDI Solar, Inc, as a subsidiary of RenuEn, marketed, itself as an "Authorized Distributor" in Central Florida of Sedna Aire USA solar thermal air conditioners, solar water heating products and solar pool heaters. 1.8 SDI, through third party marketers, utilized mass mailings and the Internet to solicit consumers for free energy efficiency analyses and to offer consumers a "special" promotion claiming that it would analyze ways for consumers to increase the energy efficiency of their homes, with no cost to consumers. Included in the sales pitch was a statement that the Energy Policy Act of 2005 allowed taxpayers to receive federal tax credit worth 30% of the system's cost. SDI also hired third-paiiy companies to assist in the installation of its solai products. 1.9 Beginning in or around 2014, the Office of the Attorney General became aware of numerous consumer complaints regarding the deceptive and unfair business practices of Respondents as it relates to the sale, financing and installation of its solar energy products According to consumer complaints, material misrepresentations were made to consumers to induce consumers to purchase and to have installed alleged energy efficient products sold by, or on behalf of, Respondents Subsequent investigation revealed that consumers were misled as to the true cost of the alleged energy efficient products being sold to consumers, as well as the alleged product 3

4 savings, decreased energy costs, and availability of solar tax credits, personal income tax credits, grants and rebates The number of consumers who have presented claims to the Office of the Attorney General and who were adversely impacted by the above-detailed unfair and deceptive business practices is currently approximately twenty-eight (28), and the loss to consumers is approximately $231, Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes, neither agree to nor admit the allegations contained above in "I. ATTORNEY GENERAL'S ALLEGATIONS". II. NON-MONETARY TERMS AND CONDITIONS 2.1 Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes, and their representatives, agents, employees, successors, assigns and/or any other person(s) acting under, by, through or on behalf of Respondents, directly or indirectly, or through any corporate or other device, agree to refrain from violating the provisions of Chapter 501, Part II, of the Florida Statutes, the Florida Deceptive and Unfair Trade Practices Act; to conduct business in the State of Florida in compliance with the provisions of Chapter 501, Part II, of the Florida Statutes, the Florida Deceptive and Unfair Trade Practices Act; and to implement the following changes to their business practices either within the State of Florida or involving consumers within the State of Florida: A. SDI SOLAR, INC 2.2 Respondent, SDI Solar, Inc shall be immediately and permanently enjoined from engaging in any business involving the marketing, sale, financing, or installation of any 4

5 commercial or residential solar products or services. 2.3 Respondent, SDI Solar, Inc, shall be immediately and permanently dissolved and never either now or in the future reinstated and/or reestablished by any Respondent herein for the purpose of conducting any business of whatsoever kind, including, but not limited to, the marketing, sale, financing, and installation of residential or commercial solar products and services, either within the State of Florida or involving consumers within the State of Florida. 2.4 The term "businesses involving the marketing, sale, financing, or installation of residential or commercial solar energy products or services" shall include, but not be limited to: 1) representing and/or soliciting through advertisement and/or oral communication, either directly or indirectly, that Respondents offer and/or provide any services involving the marketing, sale, financing, or installation of residential or commercial solar energy products or services; 2) soliciting, inducing and/or encouraging consumers to utilize any services involving the marketing, sale, financing, or installation of residential or commercial solar energy products or services; and 3) accepting, receiving or otherwise obtaining funds from consumers for any services involving the marketing, sale, financing, or installation of residential or commercial solar energy products or services. 2.5 Respondent, SDI Solar, Inc, shall immediately and permanently sever any ties with a business named "Energy Solutions of Florida" and never again conduct business of any kind either within the State of Florida or involving residents of the State of Florida utilizing the name "Energy Solutions of Florida". B. RENUEN CORPORATION 2.6 Respondent, RenuEn Corporation, shall be immediately and permanently 5

6 enjoined from engaging in any business involving the marketing, sale, financing, or installation of residential or commercial solar products or services Respondent, RenuEn Corporation, shall further voluntarily and permanently divest itself of any ownership interest in SDI Solar, Inc. 2.8 Respondent, RenuEn Corporation, shall immediately and permanently sever any ties with a business named "Energy Solutions of Florida" and never again conduct business of any kind either within the State of Florida or involving residents of the State of Florida utilizing the name "Energy Solutions of Florida". C. JEFFREY CHARLES NEMES 2.9 Respondent, Jeffrey Charles Nemes, shall immediately and permanently sever any ties with a business named "Energy Solutions of Florida" and never again conduct business of any kind either within the State of Florida or involving residents of the State of Florida utilizing the name "Energy Solutions of Florida" Respondent, Jeffrey Charles Nemes, shall be immediately and permanently enjoined from engaging in any business involving the direct financing and installation of solar products or services While the parties agree that Respondent, Jeffrey Charles Nemes, may continue to engage in the marketing and sale, but not direct financing and installation of, solar products or services, the agreement is subject to the below conditions: A. In engaging in the marketing and sale of solar products and services solely as an employee of a company with which Respondent, Jeffrey Charles Nemes, has no business, fiduciary, financial or personal association, Respondent shall, regardless of the policies of the 6

7 respective company, entity or association, refrain from violating in any manner the provisions of Chapter 501, Part II, of the Florida Statutes, the Florida Deceptive and Unfair Trade Practices Act and conduct business in the State of Florida in compliance with the provisions of Chapter 501, Part II, of the Florida Statutes, the Florida Deceptive and Unfair Trade Practices Act. B. In engaging in the marketing and sale of solar products and services, Respondent, Jeffrey Charles Nemes, whether acting through principals, officers, directors, shareholders, representatives, employees, agents, independent contractors, distributors, successors, and assigns, or acting through any limited liability company, corporation, or other business entity whose acts, practices or policies are directed, formulated, or controlled by Respondent, Jeffrey Charles Nemes ( sole "Respondent" for this subsection), shall implement the below business practice: L Respondent, and any third-parties retained by Respondent, shall ensure that consumers who purchase any solar products and services sold by, or on behalf of, Respondent are provided with the name and contact information of a single point of contact who shall shepherd or otherwise address and resolve consumers' comments, questions, concerns, or complaints regarding the solar products or services sold by, or on behalf of, Respondent. ii. Respondent, and any third-parties retained by Respondent, shall ensure that no material misrepresentations are made to consumers who purchase solar products and services sold by, or on behalf of, Respondent regarding the actual savings and benefits available to consumers as the result of their purchase of the solar products or services from, or on behalf of, Respondent. 7

8 iii.respondent, and any third-parties retained by Respondent, shall ensure that consumers who purchase solar products and services sold by, or on behalf of, Respondent, are informed in writing prior to a consumer entering into a sales contract or agreement of the specific benefits of purchasing the solar products and/or services being sold to the consumer. 1v. Respondent, and any third-parties retained by Respondent, shall be fully educated and trained regarding the specific solar products or services being sold to the public, as well as the specific benefits to a consumer who ultimately purchases solar products and/or services by, or on behalf of, Respondent. v. Respondent, and any third-parties retained by Respondent, shall ensure that the terms and conditions associated with each and every solar product or service sold by, or on behalf of, Respondent is clearly communicated to consumers pnor to the sale of a solar product by, or on behalf of, Respondent. vi. Neither Respondent nor any third-parties retained by Respondent, shall materially overstate the value of or savings associated with any product or service sold by, or on behalf of, Respondent. vii. Respondent shall use legally compliant third party marketers and sellers of any solar products and services and shall discontinue such engagement in the event that Respondent receives notice that one of its third party marketers or sellers has repeatedly failed or refused to comply with any requirements contained in the instant A VC. 8

9 viii. t shall develop and implement a framework of policies, systems, cedures designed to effectively monitor and detect if any of its third p~marketers or sellers are not accurately depicting the true nature of the solar products and services being sold on behalf of Respondent or is otherwise not in compliance with the terms and conditions of this AVC. ix. Respondent shall address and resolve any consumer inquiries or complaints that it receives about any solar product or service sold by, or on behalf of, Respondent within seven (7) days of Respondent's notice of a consumer's inquiry or complaint Respondent, Jeffrey Charles Nemes, shall not implement any changes in the form of doing business or the organizational identity of any existing business entity and/or creating any other legal entity or business involving the marketing, sale, financing, or installation of residential or commercial solar energy products or services for the purpose of avoiding any provisions, obligations, terms or conditions set forth in this AVC. III. MONETARY TERMS AND CONDITIONS Investigative Costs and Attorneys' Fees 3.1 The parties stipulate and agree that the Department of Legal Affairs is entitled to payment of its attorneys' fees and costs in the amount of One Hundred Thirty-Two Thousand Five Hundred Seventy Dollars and Zero Cents ($132,570.26). 3.2 The Department agrees to suspend its award of attorneys' fees and costs and such agreement is expressly premised upon Respondents' compliance with the terms and conditions of the instant Assurance of Voluntary Compliance; representation that the Financial Disclosures provided by Respondents prior to the execution of this A VC which form the basis of 9

10 the Department's agreement to suspend its award of attorneys' fees and costs are truthful, accurate, and complete; and Respondents' agreement to cooperate with the Department in connection with this investigation and/or any subsequent investigation(s) related to or associated with any matters which are the subject ofthis investigation. 3.3 If, upon motion by the Department, a court of competent jurisdiction finds that Respondents materially failed to comply with any te1m of this A VC or that Respondents failed to disclose any and all material assets, materially misstated the value of any asset, or made any other material misstatement or omission in any representation to the Department, then Respondents shall become immediately jointly and severally liable to the Department for the sum of $132, in attorneys' fees suspended under this AVC. The award of suspended attorneys' fees shall be in addition to any attorneys' fees awarded in any such future action. Civil Penalties 3.4 The parties stipulate and agree that civil penalties under Sections and are permitted in the amount of $10,000 and $15, respectfully, for each violation of FUTP A. collection of civil penalties. 3.5 The Department of Legal Affairs agrees to suspend the assessment and 3.6 The Department's agreement to suspend the assessment and collection of civil penalties is expressly premised upon Respondents' compliance with the terms and conditions of the instant Assurance of Voluntary Compliance; representation that the Financial Disclosures provided by Respondents prior to the execution of this A VC which form the basis of the Department's agreement to suspend civil penalties are truthful, accurate, and complete; and Respondents' agreement to cooperate with the Department in connection with this investigation 10

11 and/or any subsequent investigation(s) related to or associated with any matters which are the subject of this investigation. 3.7 If upon motion of the Department a court of competent jurisdiction finds that Respondents materially failed to comply with any term of this A VC or that Respondents failed to disclose any and all material assets, materially misstated the value of any asset, or made any other material misstatement or omission in any representation to the Department, then Respondents shall become immediately jointly and severally liable to the Department for the sum of $23,000, in civil penalties suspended under this AVC, which represents an assessment of $10, per consumer claim listed in the consumer spreadsheet attached to the instant AVC. The award of suspended civil penalties shall be in addition to any additionally awarded attorneys' fees and costs, and other relief, as allowed by law. Consumer Restitution 3.8 The parties stipulate and agree that consumer restitution under Sections and is permitted. consumer restitution. 3.9 The Department of Legal Affairs agrees to suspend its efforts to seek 3.10 The Department's agreement to suspend its efforts to seek consumer restitution is expressly premised upon Respondents' compliance with the terms and conditions of the instant Assurance of Voluntary Compliance; representation that the Financial Disclosures provided by Respondents prior to the execution of this AVC which form the basis of the Department's agreement to suspend civil penalties are truthful, accurate, and complete; and Respondents' agreement to cooperate with the Department in connection with this investigation and/or any subsequent investigation(s) related to or associated with any matters which are the 11

12 subject of this investigation If upon motion of the Department a court of competent jurisdiction finds that Respondents materially failed to comply with any term of this A VC or that Respondents failed to disclose any and all material assets, materially misstated the value of any asset, or made any other material misstatement or omission in any representation to the Department, then Respondents shall become immediately jointly and severally liable to the Department for the sum of $303, in consumer restitution. The award of suspended consumer restitution shall be in addition to any additionally awarded attorneys' fees and costs, civil penalties, and other relief, as allowed by law. Additional Monetary Terms 3.12 In the event the full Judgment amount of $23,438, is reinstated, the Department shall credit towards the Restitution Amount, Civil Penalties Amount and/or Fees Amount any payments received from Respondents in this matter. IV. MISCELLANEOUS TERMS 4.1 Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes, shall ensure that all of the terms and conditions of this AVC are known to their representatives, agents, employees, managers, officers, directors, assigns, successors and/or any other person acting under, by, through or on their behalf. 4.2 Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes, agree to preserve and to retain all relevant business and financial records relating to the acts and practices at issue in this AVC and other information reasonably sufficient to establish compliance with the provisions of this A VC for a period of two (2) years from the date of this A VC and to provide access to such documents and information to the Attorney General within 12

13 seven (7) days of a request by the Department. 4.3 Nothing herein shall be construed as a general waiver of any private right, cause of action, or remedy of any private person against the Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes. Similarly, nothing contained herein shall waive the right of Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes, to assert any lawful defenses in response to a consumer-complaint. 4.4 Upon entry of this A VC, and payment of all required funds, the Office of the Attorney General for the State of Florida agrees to close its civil investigation into the activities of Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes. 4.5 Notwithstanding any other provision of this AVC, the parties acknowledge that any future violations of either this A VC or Florida law by any Respondent may subject all Respondents to additional and unrelated civil penalties and sanctions, as provided by law. 4.6 Although the Parties jointly participated in the negotiation of the terms articulated in this A VC, no provision herein shall be construed for or against either party on the grounds that any one party was more heavily involved in the preparation of the A VC and/or its terms. 4.7 The parties agree that all notices, including notices of default, required hereunder shall be sufficient if given as provided below: AS TO THE ATTORNEY GENERAL Carol E. A. DeGraffenreidt Assistant Attorney General - Economic Crimes 1515 North Flagler Drive # 900 West Palm Beach, FL

14 AS TO THE RESPONDENTS Charles J. Nemes, Chief Executive Officer RenuEn Corporation SDI Solar, Inc North Ocean Drive, #162 Singer Island, FL V. EFFECTIVE DATE 5.1 The effective date of this A VC shall be the date of its execution and delivery by the Department of Legal Affairs. Acceptance by the Department of Legal Affairs shall be established by the signature of Deputy Attorney General Patricia A. Conners. The receipt by the Department of Legal Affairs of any monies pursuant to the A VC does not constitute acceptance of the AVC by the Deprutment of Legal Affairs, and any monies received shall be returned to Respondents in the event that this AVC is not accepted and fully executed by the Department of Legal Affairs. 5.2 Respondents agree that they have been given the opportunity and sufficient time to retain legal counsel of their choice and that they have declined to retain counsel and have elected to enter into this A VC without representation by legal counsel. IN WITNESS WHEREOF, Respondents, RenuEn Corporation, SDI Solar, Inc, and Jeffrey Charles Nemes, have caused this Assurance of Voluntary Compliance to be executed by an authorized representative, as a true act and deed, in the county and state listed below, as of the date affixed thereon. PARTIES' SIGNATURES ON FOLLOWING PAGES 14

15 RenuEn Corporation (An Active State of Florida For-Profit Corporation) '?~~ J.. '".r( Agreed to and signed this~ day of/1~ who stated and affirmed as follows:, 2016, by the below-stated person BY MY SIGNATURE I hereby affirm that I am acting in my capacity and within my authority as Chief Executive Officer of RenuEn Corporation and that by my signature I am binding RenuEn Corgoration to tf e terms and conditions of this A VC. By: ~~ ~ \~ ef C{l@s J. NEMES, CiiIEF EXECUTIVE OFFICER RENUEN CORPORATION STATE OF FLORIDA ) COUNTY OF PALM BEACH ) BEFORE ME, this day of.av:,w +-- u, 2016, an officer duly authorized to take acknowledgments in the State of Florida, personally appeared CHARLES J. NEMES, who acknowledged before me that he executed the foregoing instrument for the purposes therein stated. NOT (print, name of Notary Public) Personally known or Produced Identification ~heck one) Type ofldentification Produced: ft.- O~ t-.jp)?-o ~ tf (do-o-:2-q ~ 6 15

16 SDI Solar, Inc. (A Wholly Owned Subsidiary of RenuEn Corporation) Agreed to and signed this~ of Avu.s~, who stated and affirmed as follows: 2016, by the below-stated person BY MY SIGNATURE I hereby affirm that I am acting in my capacity and within my authority as Chief Executive Officer ofrenuen Corporation and that by my signature I am binding ST A TE OF FLORIDA ) COUNTY OF PALM BEACH ) 2?-.. 0 A BEFORE ME, this -: J day of /1V<.,...U$..\--, 2016, an officer duly authorized to take acknowledgments in the State of Florida, personally appeared CHARLES J. NEMES, who acknowledged before me that he executed the foregoing instrument for the purposes therein stated. lj (print, m~ir-m'!'ft'l'!"""'mrr'!'n'r.~~& name of Notary Public) Personally known ~ or Produced Identification /. (check one) tt--p~ vtr::>2o lo<o ~ 02-9-() Type of Identification Produced: 16

17 Charles J. Nemes (Individually) Agreed to and signed this23j '~of~l~, 2016, by the below-stated person who stated and affirmed as follows: BY MY SIGNATURE I hereby affirm that my signature below binds me both personally STA TE OF FLORIDA ) COUNTY OF PALM BEACH ) BEFORE ME, this )??<20 day of~1s.\--, 2016, an officer duly authorized to take acknowledgments in the State of Florida, personally appeared CHARLES J. NEMES, who acknowledged before me that he executed the foregoing instrument for the purposes therein stated. (print~)> or s amp comm1ss10ne name ofnotary Public) Personally known -=--- r-produced Identification. ~ (check one) fl_ DC--:;#- N ~ 2-D -42-3~ _ Type of Identification Produced: 17

18 For the Attorney General's Office?~d /J Signed thisp(.j a ay of /Lr";;tft,t4('=, ~~d~~ Carol E.' A. Deefraffe' eidt/ / Assistant Attorney deneral Office of the Attorney General Florida Bar No North Flagler Drive, Suite 900 West Palm Beach, Florida, Telephone No.: (561) Facsimile No.: (561) Electronic mail: carol.degraffenreidt@myfloridalegal.con~ Accepted this J</~ay of ~ /l~ Patricia A Conners, Deputy Threetef I~ l~ ~ Department of Legal Affairs Office of the Attorney General The Capitol Tallahassee, FL