As noted in an FTC press release, the FTC testified before the House Energy and Commerce Subcommittee on Consumer Protection and Commerce on legislation to modify the FTC’s authority and address other pressing issues facing the agency. The testimony was approved on a 5-0 vote. According to the FTC testimony,
Of particular importance is the Committee’s work to restore the Commission’s ability to secure monetary relief from those that violate the law. Until the Supreme Court’s recent decision in AMG¸ the Commission relied on its 13(b) authority to return billions of dollars to defrauded Americans, and to ensure that lawbreaking companies could not pocket their ill-gotten gains. For example, pending cases today involve $2 billion in potential relief to victims, which is not available after AMG.
The Commission also now faces challenges in obtaining injunctive relief, the testimony notes. In FTC v. Shire ViroPharma, Inc., the Third Circuit held that the language in Section 13(b) of the FTC Act describing a company that “is engaged in, or is about to engage in” illegal conduct means the FTC can initiate enforcement actions only when a violation is either ongoing or “impending” at the time the suit is filed. This decision limits the Commission’s ability to hold accountable entities who engaged in illegal conduct that occurred entirely in the past. The district court’s recent dismissal of the FTC’s antitrust complaint against Facebook cited the ViroPharma opinion in concluding that the Commission could not use Section 13(b) to address Facebook’s alleged past anticompetitive conduct. Restoring the FTC’s power to seek injunctions and monetary relief is critical to our work to protect Americans from unlawful business conduct.
Eric J. Ellman is Senior Vice President for Public Policy and Legal Affairs at the Consumer Data Industry Association (CDIA) in Washington, DC. He also served for eight months as Interim President and CEO of the Association. More