Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: FTC says it has halted NERD Solutions, ED REF student debt relief operations, (Apr 17, 2026)

By Justin Marcus Smith, J.D.

The FTC obtained a TRO with an asset freeze on an ex parte basis.

The FTC justified the issuance of a comprehensive ex parte temporary restraining order (TRO) to halt the alleged scam debt-relief operations of NERD Solutions, Inc. and ED REF Inc., held the federal district court in Santa Ana, California. The Commission vote authorizing the filing of the FTC complaint was 2-0, according to the FTC announcement. The court entered a TRO on the same day the FTC filed the complaint, April 13, 2026. The TRO freezes the defendants’ assets and permits the FTC to enter the defendants’ premises (FTC v. Nerd Solutions Inc., No. 8:26-cv-00885-JVS-JDE (C.D. Cal. Apr. 13, 2026)).

Background. The FTC brought a judicial complaint against NERD Solutions, Inc., ED REF Inc., and two natural persons who allegedly operated the entities. They were all based in California, and the FTC said they operated as a common enterprise.

The complaint claimed violations of the FTC Act, 15 U.S.C. § 45(a); the FTC’s Telemarketing Sales Rule (TSR), 16 C.F.R. Part 310; the FTC’s Regulation Rule on Impersonation of Government and Business (Impersonation Rule), 16 C.F.R. Part 461; and Section 521 of the Gramm-Leach-Bliley Act, 15 U.S.C. § 6821.

The complaint alleged the defendants illegally marketed student loan debt relief services by cold calling consumers, many of whom were on the National Do Not Call list. The complaint said the defendants pretended to be affiliated with the U.S. Department of Education or the consumers’ actual loan servicers. The defendants allegedly collected at least $8.8 million from consumers by using false claims of student loan forgiveness to lure them into paying illegal upfront monthly fees as high as $1,400. The FTC said the defendants did not provide the promised student loan debt relief services.

The complaint alleged the defendants used Philippines internet protocol (IP) addresses for placing IP telephony calls to U.S. consumers. In many instances, the defendants’ telemarketers already possessed and could recite the consumers’ Social Security number, outstanding student loan balance, and loan servicer names.

The FTC sought temporary, preliminary, and permanent injunctive relief; monetary relief; and other relief, including an asset freeze, appointment of a receiver, and immediate access to the defendants’ business premises.

The FTC moved on an ex parte basis, pursuant to Fed. R. Civ. P. 65(b) and Local Rule 65-1, for a temporary restraining order, an asset freeze, other equitable relief, and an order to show cause why a preliminary injunction should not issue against the defendants.

Likelihood of success. The court found it had good cause to believe it had jurisdiction over all parties and that the FTC has a likelihood of prevailing on the merits. It appeared to the court that the defendants engaged in or were likely to engage in acts or practices that violate Section 5(a) of the FTC Act, 15 U.S.C. 45(a), multiple TSR and Impersonation Rule provisions, and Section 521 of the GLB Act. The court said the FTC supported its motion with consumer declarations, consumer complaints, and other documentation.

Irreparable harm. The court found good cause to believe the defendants had taken at least $9.8 million in gross revenue as a result of the alleged unlawful practices. Moreover, in the absence of injunctive relief, the court agreed with the FTC that the defendants posed immediate irreparable harm to more consumers on an ongoing basis. The court accordingly found good cause to relieve the FTC of the duty to provide the defendants with prior notice of the motion for a TRO.

Asset freeze. The court found good cause existed for freezing the defendants’ assets; disabling their websites; permitting FTC entry into their premises; and permitting the FTC to take expedited discovery.

The asset freeze specifications were detailed, comprehensive, and ordered third parties, like financial or brokerage institutions, to comply with hold, preservation, and retention requirements on notice of the TRO. The defendants are separately subject to mandatory financial disclosures. The TRO also provided for foreign asset repatriation.

Premises access. The TRO permits the FTC to have immediate access to any business premises or storage facilities of the defendants. The FTC can remove all manner and form of information related to the defendants’ businesses at issue subject to specific inventory and return requirements. The defendants are to cooperate.

Equities. The court found the FTC likelihood of success on the merits and the public interest favored entry of the requested TRO.

Prohibited conduct. The court also ordered the defendants to stop:

• misrepresenting debt relief services;

• charging or receiving money or other valuable consideration up-front for the performance of any debt relief, as defined;

• failing to make proper disclosures that consumers who stop making timely loan payments will likely suffer adverse creditworthiness consequences;

• initiating or causing others to initiate calls that fail to transmit the true originating telephone number and the telemarketer’s name as part of caller identification service;

• causing calls to phone numbers on the National Do Not Call Registry;

• causing calls without payment of the annual fee required under the TSR for access to phone numbers on the National Do Not Call Registry;

• making false statements to customers or financial institutions to obtain consumer information;

• selling, otherwise disclosing, or benefiting from the disclosure of the identifying information of any person that any defendant obtained in connection with any of the litigated activity, except for law enforcement or defense attorney use;

• conducting any sort of business, new or old, without disclosure to the FTC.

Records preservation. The TRO required the preservation of relevant records. It further ordered any third-party internet providers, domain registrants, and so forth, on actual notice, to take whatever steps are necessary to render the defendants’ websites inaccessible to the public and to preserve related evidence. The defendants are to provide all affiliates, telemarketers, agents, and so forth, with a copy of the TRO.

Expedited discovery. The court ordered limited expedited discovery for the purpose of locating assets; locating business transactions and operations and associated documents; or for order compliance. The FTC may take depositions of parties and non-parties as specified, serve party interrogatories, and serve subpoenas on non-parties that direct production or inspection within five days of service.

Seal dissolved. The court found the temporary seal over the case should be dissolved given completion of service on the first defendant.

The Case is No. 8:26-cv-00885-JVS-JDE.

Judge: Selna, J.

Attorneys: Gregory A. Ashe for the FTC.

Companies: Nerd Solutions Inc.

News: ConsumerProtection FederalTradeCommissionNews CaliforniaNews