IN THE COUNTY COURT, IN AND FOR PINELLAS COUNTY, FLORIDA SMALL CLAIMS DIVISION PLAINTIFF S COMPLAINT

Transcription

1 IN THE COUNTY COURT, IN AND FOR PINELLAS COUNTY, FLORIDA SMALL CLAIMS DIVISION MATTHEW D. WEIDNER, Plaintiff, CASE NO.: v. KIDS WISH NETWORK, INC. Defendant. / PLAINTIFF S COMPLAINT Plaintiff Matthew D. Weidner ( Plaintiff ), by and through undersigned counsel, sues Kids Wish Network, Inc. ( KWN or "Defendant"), and alleges as follows: JURISDICTION, VENUE, AND PARTIES 1. This is an action for damages and equitable relief that does not exceed $5, exclusive of attorney s fees and costs and for equitable relief This Court has subject-matter jurisdiction based on Fla. Stat , Fla. Stat. 501, and F.S. 3. In 1997, Fulfill a Wish Foundation, Inc was incorporated as a not for profit in the state of Florida. Subsequently, in 1999, Fulfill a Wish Foundation, Inc. changed its name to Kids Wish Network, Inc. 4. KWN has a principal address of 4060 Louis Ave., Holiday, FL KWN's registered agent is listed as a Anna Lanzatella, Grand Club Dr., Hudson, FL KWN is designated as a not for profit corporation registered in the State of Florida and as a tax exempt organization under Section 501(c)(3) of the Internal Revenue Code. Page 1 of 14

2 6. At all material times, KWN constituted an "organization" as defined by Section (1)(b), Florida Statutes and a "charitable organization" as defined by Section (1), Florida Statutes. 7. Venue is proper because the events complained of occurred in Pinellas County. 8. Plaintiff is a resident of Pinellas County, Florida and is otherwise sui juris. FACTS COMMON TO ALL COUNTS 9. After a 2013 investigation by the Center for Investigative Reporting, the Cable News Network and the Tampa Bay Times, Kids Wish Network was identified in a story entitled Americas Worst Charity. The report found that Kids Wish Network spent less than 3 cents on the dollar on helping kids and that the bulk of money raised by the charity was diverted to enrich the charity's operators and the for profit companies Kids Wish hires to drum up donations. (Exhibit A) 10. Kids Wish Network's entire fundraising model is predicated on false, deceptive and unfair and unduly manipulative fundraising campaigns that mislead the general public. The very name, "Kids Wish Network" is misleading because it suggests that the primary purpose of the organization is to grant wishes to children. In fact, as the financial records attached to this complaint will reveal, the primary purpose of the Kids Wish Network marketing campaigns is to separate charitable donations from unsuspecting members of the general public and funnel the money that is intended to fulfill charitable purposes into the hands of for profit entities. Those unsuspecting and well meaning contributors are victims of the false, unfair and deceptive and unfair campaigns executed by Kids Wish Network. 11. A key component of the Kids Wish Network enterprise are their efforts to convince celebrities, businesses and private individuals to contribute their time, their celebrity status and experiences at resorts, amusement parks and attractions. After making these contributions, pictures and images of children standing with these celebrities and engaging in activities at resorts and Page 2 of 14

3 amusement parks are placed prominently on the Kids Wish Network website. The perpetual use of these images and experiences to further the subsequent efforts of the Kids Wish Network enterprise is impermissibly manipulative and makes the celebrities and other well meaning individuals who contributed to Kids Wish Network unwitting victims of the ongoing enterprise. 12. On Nov. 11, 2016, Plaintiff, Matthew Weidner, donated $25.00 to KWN. (Exhibit B) I. Introduction CLAIMS FOR RELIEF COUNT I Violations of Florida s Deceptive and Unfair Trade Practices Act 13. The Florida legislature enacted Chapters 501 (Florida's Deceptive and Unfair Trade Practices Act) and 496 (Florida's Solicitation of Contributions Act) to protect the public from deceit, fraud, and misrepresentation. 14. Specifically, the legislative intent behind Chapter 496 of Florida Statutes (Florida's Solicitation of Contributions Act) is laid out in F.S : Legislative intent. It is the intent of the Legislature to recognize the right of persons or organizations to conduct solicitation activities. It is also the intent of the Legislature to protect the public by requiring full public disclosure of the identity of persons who solicit contributions from the public, and of the purposes for which such contributions are solicited and the manner in which the contributions are actually used. It is further the intent of the Legislature to prohibit deception, fraud, and misrepresentation in the solicitation and reporting of contributions. 15. In enacting Florida's Solicitation of Contributions Act, the legislature mandated that certain enumerated violations ( ) of Chapter 496, F.S. would be per se violations of Florida's Deceptive and Unfair Trade Practices Act under Chapter 501, F.S. 16. With this framework in mind, plaintiff will ask this court to examine the specific text of Chapter 496, F.S., find that the conduct of Defendant represents explicit violations of Chapter 496, F.S., and then find violation of Chapter 501, F.S. Page 3 of 14

4 II. The Failure to Provide Statutorily-Required Disclosures 17. Florida Statutes (1) provides that it is unlawful for any person in connection with the planning, conducting, or execution of any solicitation or charitable sales promotion to operate in violation of Further, F.S and provides certain disclosure requirements that a charitable organization, sponsor, or professional solicitor must comply with. 19. KWN is required to registered under F.S A true an correct copy of Defendant's solicitation of contribution form as reflected on the Nov. 11, 2016 KWN website is attached hereto as Exhibit C. The statutorily-required disclosures are not made. 21. Plaintiff's receipt, which was previously attached as Exhibit B, also fails to include the statutorily required disclosers. 22. These violations of Florida Statute 496 are in fact per se violations of Florida Statute 501 and should lead to a judicial determination that Kids Wish Network engaged in False Deceptive and Unfair Practices as defined by the Act. III. The Use of Third Party Names without Written Consent Act to: 23. F.S (3) provides that it is a violation of the Florida's Solicitation of Contributions Make misrepresentations or misleading statements to the effect that any other person or organization sponsors or endorses such solicitation, approves of its purpose, or is connected therewith, when that person or organization has not given written consent to the use of its name. 24. A key and prominent element of the Kids Wish Network fundraising enterprise is their website which is identified as Defendant also own or utilize several other websites which funnel traffic to including Page 4 of 14

5 The websites are comprised of thousands of individual pages that are crammed full with images, videos and text. The technical elements of the website and the back end architecture and indexing of those individual pages, images and text are constructed in such a manner to highlight, emphasize and trade upon the inherent value of those images and text in google and internet search results. The use of these pages, images and text in such a manner is misleading, deceptive and unfair because it impermissibly suggests that these persons and entities endorse or are affiliated with Kids Wish Network or that they formally consent to being associated with the organization and its fundraising activities. 25. Indeed, prominently featured on the Nov. 11, 2016 version of Defendant's website are statements that several nationally recognized and reputable organizations are "Affiliates" and "Partners" of Defendant. See a true and correct copy of Defendant's affiliates attached as Exhibit D. 26. Prominently featured on the Nov. 11, 2016 version of Defendant's website are statements that several nationally recognized and reputable celebrities are "Celebrity Wish Granters" and "Partners" of Defendant. See a true and correct copy of Defendant's Celebrity Wish Granters attached as Exhibit E. As representative examples, featured prominently on the Kids Wish Network website is the following image and text of Taylor Swift: Page 5 of 14

6 A true and correct copy of the entire article is attached as Exhibit F. 27. Next, see the image and text of former President of the United States President Barack Obama: A true and correct copy of the entire article is attached as Exhibit G. Page 6 of 14

7 28. The prominent use of the images and good name of well know and even internationally recognized figures, along with the text associating Kids Wish Network is misleading, deceptive and unfair. The preceding images are merely representative examples, the website in fact contains hundreds of individual pages and thousands of images, text and phrases. 29. Prominently featured on the Nov. 11, 2016 version of Defendant's website are statements that several nationally recognized and reputable organizations are "Wish Granters" and "Partners" of Defendant. See a true and correct copy of Defendant's Wish Granters attached as Exhibit H. 30. The statements that appear on the website that the said organizations and individuals are "Affiliates", "Celebrity Wish Granters", "Wish Granters" or "Partners" with Defendant is a misrepresentation or misleading statements to the effect that any other person or organization sponsors or endorses such solicitation, approves of its purpose, or is connected therewith. KWN uses the images of celebrities, public figures and organizations as part of their larger effort to trick and deceive members of the general public into thinking that, because these well known figures engage in well-meaning charitable efforts, they also support and endorse the efforts of the Kids Wish Network. 31. Upon information and belief KWN does not have written authorization from all of these institutions and persons to call these persons and organizations "Affiliates", "Celebrity Wish Granters", "Wish Granters" or "Partners" of Defendant. Furthermore, these individuals and intuitions would not consent to the use of their good name and images by an organization that does not use contributions in a manner consistent with the alleged charitable purpose. IV. The Failure to Apply Contributions Substantially Consistent with the Solicitation 32. F.S (16) provides that it is a violation of the Florida's Solicitation of Contributions Act to fail to apply contributions in a manner substantially consistent with the solicitation. Page 7 of 14

8 33. As detailed throughout this Complaint, the stated mission of KWN is "is a charitable organization dedicated to infusing hope, creating happy memories, and improving the quality of life for children having experienced life-altering situations." This statement does not reveal that the vast bulk of the contributions received by KWN serve no charitable purpose whatsoever, but are in fact paid to independent contractors and other expenses. As an example, a contract filed with the Florida Department of Agriculture and Consumers Services entered into between Kids Wish Network and a for profit entity identified as "Organizational Development, Inc." reveals that KWN gives Organizational Development the exclusive right to call on consumers located within the State of Florida. The contract reveals that for every dollar received as part of an allegedly charitable solicitation campaign, $85.00 comes directly and is paid directly to this for profit entity, Organizational Development, Inc. A true and correct copy is attached as Exhibit I. 34. It is a violation of F.S (16) for such a large portion of every dollar received to be paid directly to a for profit entity and it is misleading, false, deceptive and unfair to pressure consumers to make charitable contributions when the vast majority of every dollar serves no charitable purpose. 35. A review of the 2015 US Internal Revenue Service Form 990 details both the funds raised and funds expended for services. The form reports that a total of $14,103, was raised by KWN in (Exhibit J) 36. Of the $14,103,131 raised, at best 1, according to the KWN tax returns, only $2,265,911 was given for program services. Thus, a mere % was used for program services such as life threatening wishes fulfilled, toy distribution, hero of the month wishes, funeral assistances, and the holiday of hope tour. The remainder of the money paid was for expenses, including lavish salaries and fundraising expenses. 1 Of the total amounts allegedly paid, $1,941,548 was attributed to non-cash assistance and $324,363 cash grants. Page 8 of 14

9 37. In 2015, Defendant paid a staggering $10,095,697 to professional fundraising services. 38. Thus, KWN raised 7 figures from generous donors who thought they were infusing hope, creating happy memories, and improving the quality of life for children having experienced lifealtering situations, but instead, approximately 84% of the money raised was used in manners which are substantially inconsistent with the mission of KWN is a violation of (16). 39. The name "Kids Wish Network" itself is misleading when examined in the context of the amount of charitable funds that are actually provided to independent contractors and salaries. V. The False, Misleading, and Inaccurate Statements made by Defendant 40. F.S (2) provides that it is a violation of the Florida's Solicitation of Contributions Act to submit false, misleading, or inaccurate information in a document that is provided to the public. As detailed below, Defendant has made numerous such false statements as shown below. A. The General False, Misleading, and Inaccurate Website 41. Defendant via its website provided false, misleading and inaccurate statements on the Nov version of its website. These statements are made to the public numerous ways, including, but not limited to: (a) That the persons and institutions previously identified as "Affiliates", "Celebrity Wish Granters", "Wish Granters" or "Partners" of Defendant is misleading and inaccurate because "Affiliates", "Celebrity Wish Granters", "Wish Granters" or "Partners" may have once helped a child, but said celebrities and institutions have not entered into any formal arrangement or partnership with Defendant as the KWN website states. (b) The front page of the KWN website prominently features statements that say "100% of contributions directed to our Guardian Angel Fund directly support our services and programs." A true and accurate selection of the front page of the KWN as of Nov. 11, 2016 is pasted below: Page 9 of 14

10 42. Nowhere on the website does Defendant state that: (1) the Guardian Angel Fund is a very small percentage of the KWN, (2) that the vast majority of every dollar raised by the KWN goes to expenses or fundraising activities and not services and programs, and (3) the vast majority of funds raised by KWN do not go to the Guardian Angel Fund. Thus, this statement is misleading and inaccurate because the statement makes it appear that a large percentage of funds raised by KWN go to services and programs, when in fact, that is not true. VI. Conclusion 43. Under, F.S , any violation of F.S is an unfair or deceptive act or practice or unfair method of competition in violation of F.S Defendant violated F.S , which is a per se violation of FDUPTA. Page 10 of 14

11 45. Plaintiff is a consumer within meaning of the statute because he is an individual who have suffered a loss as a result of the defendant's violation of Florida s Unfair and Deceptive Trade Practices Act. 46. As a direct and proximate cause of the defendant's unfair trade practices, Plaintiff has sustained actual damages and has also had to hire an attorney in the vindication of their rights and has become obligated to pay their attorney a reasonable fee for the attorney s services and other costs of this action. 47. This practice therefore violates Florida's Deceptive and Unfair Trade Practices Act ("FDUTPA"), Fla. Stat WHEREFORE, Plaintiff demands: a. Judgment in his favor; b. Actual damages; c. Statutory damages for each violation of the FDUTPA committed by Defendant pursuant to Fla. Stat ; d. An order enjoining Defendant from further violations of the FDUTPA; e. An award of attorneys fees and costs pursuant to Fla. Stat ; and f. Any other relief the Court deems just and proper. COUNT II Declaratory Judgment 48. Plaintiff re-alleges and re-incorporates the preceding paragraphs and allegations as if fully set forth herein. 49. Plaintiff seeks relief pursuant to Florida s Declaratory Judgment Act, Fla. Stat. 86, et seq. and F.S. 496, et seq. regarding the statements that KWN made on its website. Page 11 of 14

12 50. This action for declaratory relief should be judicially decided as there is a bona fide, actual, present, and practical need for the declaration as to whether the statements that Plaintiff made on its website were allowable under F.S. 496 et. seq. and whether those statements mislead potential donors. 51. The declaration sought pertains to a present, ascertainable state of facts or controversy involving those facts regarding whether Plaintiff is engaging in activities prohibited by F.S. 496 et. seq. 52. Plaintiffs have an actual, present, adverse, and antagonistic legal interest in the resolution of the present controversy because there is a doubt as to the whether the statements that Plaintiff made on its website were allowable under F.S. 496 et. seq. and whether those statements mislead potential donors and Plaintiff is entitled to have that doubt removed. 53. Plaintiff has an actual, present, adverse, and antagonistic interest in the subject matter have been joined in this action, and all adverse interest are before the Court. 54. The relief sought is not merely the giving of legal advice by the Court or the answer to questions propounded from mere curiosity; rather, the relief sought is an approved use of the Declaratory Judgment Act under Florida law. 55. Accordingly, Plaintiffs request that the Court enter a judgment determining that the KWN's declarations on its website violate F.S WHEREFORE, Plaintiffs demand: a. Judgment in his favor declaring that the Defendant's declarations via its website violate F.S. 496; b. An award of attorneys fees and costs; and c. Any other relief the Court deems just and proper. COUNT III Page 12 of 14

13 INUNCTION (PERMANENT) 56. Plaintiff re-alleges and re-incorporates the preceding paragraphs and allegations as if fully set forth herein. 57. Plaintiff seeks a permanent injunction pursuant to F.S. 496, et seq. regarding the statements that KWN made on its website violates F.S. 496, et seq. 58. These statements on the website operate as part of a scheme to mislead magnanimous donors into the donating money to Defendant on the belief that the, whether funds are solicited via the website or via telephone or mail solicitation, money is being donated to infuse hope, create happy memories, and improving the quality of life for children having experienced life-altering situations 59. KWN made statements on its website which had the effect of making KWN appear to be larger and more efficient with donors dollars than they actually were, deceiving the donating public. 60. In fact, in numerous instances, KWN spent either nothing, or an infinitesimal amount in relation to the amount raised, on helping to improve the lives of children. The purposes for which contributions would be used were central to donors decisions to contribute funds to these organizations. If donors had known that most of their contributions would be spent in other ways and for unrelated purposes, and not been deceived, they would have made different donating decisions. 61. Only a fraction of those funds raised goes towards helping children. 62. Of the money raised each year, KWN pays millions to a third party telemarketer and thousands of dollars to management and overhead, leaving only a fraction of the money raised to support noble causes. 63. This diversion of charitable funds has deceived donors and wasted millions of dollars that could have been spent as donors intended, to help children who are suffering. Page 13 of 14

14 64. Plaintiff therefore has a substantial likelihood of success on the merits. 65. Plaintiff, and other donors, will suffer irreparable harm unless the court issues an injunction. 66. The threat of injury to Plaintiff, and other donors, outweighs any threatened harm the injunction may cause Defendant. 67. Finally, the injunction, if issued, will not disserve the public interest. To the contrary, allowing Defendant to continue utilizing these tactics takes money away from other noble charities and therefore serves the public interest. 68. There is no other adequate remedy at law. WHEREFORE, Plaintiffs demand: a. Judgment enjoining Plaintiff from (1) utilizing telemarketers from soliciting donations, (2) making statements in violation of F.S. 496, either on the phone, mailings, or via its website, and (3) require Plaintiff to disclose what portion of its funds go toward its stated goal in its contact with the public. b. An award of attorneys fees and costs; and c. Any other relief the Court deems just and proper. DEMAND FOR ATTORNEY S FEES AND COSTS Plaintiff hereby demands an award of all attorney s fees and costs incurred in prosecution of this action. Dated this 5th day of January, By: /JMK/ Jason Michael Kral, Esq. Attorney for Plaintiff 250 Mirror Lake Dr., N. St. Petersburg, FL (727) service@mattweidnerlaw.com FBN: Page 14 of 14