Case 1:18-cv-09936-LGS Document 78-1 Filed 01/31/19 Page 1 of 204 EXHIBIT A Case 1:18-cv-09936-LGS Document 78-1 Filed 01/31/19 Page 2 of 204 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK JANE DOE, LUKE LOE, RICHARD ROE, and MARY MOE, individually and on behalf of all others similarly situated, Plaintiffs, v. No. _______________________1:18- THE TRUMP CORPORATION, DONALD J. cv-09936-LGS TRUMP, in his personal capacity, DONALD TRUMP JR., ERIC TRUMP, and IVANKA TRUMP, JURY TRIAL DEMANDED Defendants. AMENDED CLASS ACTION COMPLAINT Case 1:18-cv-09936-LGS Document 78-1 Filed 01/31/19 Page 3 of 204 TABLE OF CONTENTS INTRODUCTION .......................................................................................................................... 1 PARTIES .................................................................................................................................. 1112 A. Plaintiffs ............................................................................................................ 1112 B. Defendants ........................................................................................................ 1113 JURISDICTION AND VENUE ............................................................................................... 1214 FACTS ...................................................................................................................................... 1315 I. THE TRUMP ENTERPRISE ....................................................................................... 1315 A. The Trump Association-in-Fact ........................................................................ 1315 B. The Trump Corp. Enterprise ............................................................................. 1518 II. BETWEEN THE EARLY AND MID-2000S, TRUMP REINVENTED HIS BRAND, AND THE TRUMP ENTERPRISE BEGAN TO CONCOCT ITS FRAUDULENT SCHEME ..................................................................................................................... .1618 III. THE TRUMP ENTERPRISE AGREES TO ENDORSE AND PROMOTE ACN THROUGH A PERVASIVE AND WIDELY DISSEMINATED MESSAGE .......... .2531 A. The ACN “Business Opportunity” Needed High-Profile Endorsement To Recruit and Maintain Investors ..................................................................................... .2531 B.Trump B. .......................The Trumps Disseminated the Message Through ACN Videos ........................................................................................................................... 2935 C. Trump The Trumps Disseminated the Message Through Print and Online Media ........................................................................................................................... 3036 D. Trump Disseminated the Message at ACN Events ........................................... 3241 E. Trump The Trumps Disseminated the Message Through National Primetime Television .......................................................................................................... 3543 IV. THE TRUMP ENTERPRISE KNOWINGLY CONVEYED A CONSISTENT FRAUDULENT MESSAGE ABOUT ACN ............................................................... .3746 A. The Trump Enterprise Falsely Represented that the ACN Business Opportunity Offered Consumers a Reasonable Probability of Commercial Success .......... .3746 1. Trump Misrepresented ACN’s Risk-Profile ........................................ .3847 2. Trump Falsely Claimed That ACN’s Business Model (and Direct-Direct- Selling in General) Provided a Viable Source of Income for Prospective Investors. ............................................................................................... 4150 3. Trump Misrepresented the Commercial Viability of ACN’s Products, Especially the ACN Video Phone. ........................................................ 4354 Case 1:18-cv-09936-LGS Document 78-1 Filed 01/31/19 Page 4 of 204 B. The Trump Enterprise Falsely Represented that He Trump Genuinely Supported ACN and Failed To Disclose That He Was Being Paid Lavishly for His Endorsement .................................................................................................... .4959 C.C. The Trump Enterprise Falsely Represented that His the Trumps’ Endorsement Was Predicated on Appropriate Due Diligence and Personal Experience with ACN’s Business ............................................................................................... .5667 V. THE TRUMP ENTERPRISE’S FRAUDULENT PROMOTION AND ENDORSEMENT OF ACN WAS THE KEY FACTOR IN PLAINTIFFS’ INVESTMENT DECISIONS ...................................................................................................................................... .5869 A. Jane Doe ............................................................................................................ 6175 B. Luke Loe ........................................................................................................... 6884 C. Richard Roe ...................................................................................................... 7187 D. Mary Moe.......................................................................................................... 7593 VI. THE TRUMP ENTERPRISE AND ACN’S CO-FOUNDER WAS WERE INVOLVED IN SIDE DEALS THAT FACILITATED MONEY FLOW BETWEEN THEM ...... .7999 A. ACN’s Co-Founder Bought Property Around The Trump Organization’s Major Golf Course Development in North Carolina .................................................. .7999 B. ACN Has Paid the Trump Enterprise To Hold Charitable Golf Tournaments at Trump Golf Clubs .......................................................................................... .81101 C. Trump Joined the Advisory Board of the SUCCESS Foundation, an Affiliate of SUCCESS Success from Home Magazine, which Purported To Provide Which Distributed Millions of “Third-Party ValidationPersonal Development” of the ACN Business Opportunity.85Books to Teens ........................................ 105 VII. THE TRUMP ENTERPRISE’S ONGOING PROMOTION AND ENDORSEMENT OF ACN ............................................................................................................................ 88109 VIII. THE TRUMP ENTERPRISE’S FRAUDULENT PROMOTION AND ENDORSEMENT OF THE TRUMP NETWORK ................................................................................... 91112 A. Ideal Health Background & DSNC Licensing Deal ....................................... 92113 B. Background on The Trump Network .............................................................. 93114 C. Trump Promoted and Endorsed the Trump Network with a Widely Distributed and Pervasive Message .................................................................................. .94115 D. Trump Falsely Represented That Consumers Had a Reasonable Probability of Commercial Success in The Trump Network ................................................ .98119 E. Trump Falsely Represented that He Was Endorsing The Trump Network Because It Was His Company and Because He Genuinely Believed It Would Be a Success ...................................................................................................................... .106127 -ii- Case 1:18-cv-09936-LGS Document 78-1 Filed 01/31/19 Page 5 of 204 IX. THE TRUMP ENTERPRISE’S FRAUDULENT PROMOTION AND ENDORSEMENT OF THE TRUMP INSTITUTE ................................................................................ 110131 A. Trump Falsely Represented That Consumers Had Reasonable Probability of Commercial Success in The Trump Institute ............................................... .112133 B. Trump Falsely Represented that He Supported the Trump Institute Because He Believed It Offered a Reasonable Probability of Commercial Success (Rather than Because the Trump Enterprise Was Being Paid) ......................................... .122144 C. Trump Falsely Represented that His Endorsement Was Predicated on Appropriate Due Diligence and/or Inside Information .................................................... .130152 X. CLASS ALLEGATIONS ......................................................................................... 131153 CAUSES OF ACTION ......................................................................................................... 137160 COUNT ONE........................................................................................................................ 137160 COUNT TWO:...................................................................................................................... 144167 COUNT THREE: .................................................................................................................. 144168 COUNT FOUR ..................................................................................................................... 147171 COUNT FIVE: ...................................................................................................................... 150174 COUNT SIX ......................................................................................................................... 151176 COUNT SEVEN ................................................................................................................... 153178 COUNT EIGHT .................................................................................................................... 156181 PRAYER FOR RELIEF ....................................................................................................... 159184 JURY DEMAND