The FTC’s enforcement and rulemaking arms have been active this week, with the former resolving actions related to telehealth and student debt relief companies. The agency will also hold a meeting this coming week regarding their much-commented-on proposed noncompete rule. In addition, the House of Representatives advanced a bill to dissolve the Bureau of Competition, the FTC’s division concerned with antitrust issues. These stories and more after the jump.

Monday, April 15, 2024

Bureau of Consumer Protection: Consumer Data Security

  • Based on joint efforts of the FTC and the DOJ, the DOJ has entered into a stipulation with telehealth company Cerebral requiring it to pay over $7 million related to charges that it disclosed sensitive consumer personal health information and data to third parties for advertising purposes. The stipulation relates to a complaint alleging that Cerebral promoted online “telehealth” services to consumers struggling with mental health and substance abuse disorders using a “negative option” model. Under a negative option, a seller treats a consumer’s silence as consent to be charged for goods or services, and consumers have to affirmatively reach out to avoid having subscriptions automatically renew. Cerebral also allegedly gathered personal health information, misrepresented to consumers the purposes for which it would use that information, and failed to safeguard that information in marketing. In addition, Cerebral allegedly made the cancellation process burdensome and challenging. The complaint alleges that this conduct violates multiple provisions of the FTC Act, the Opioid Addiction Recovery Fraud Prevention Act of 2018, and the Restore Online Shoppers’ Confidence Act. In addition to the monetary fine, which will be used to provide refunds to impacted consumers, the proposed stipulation bans the company from continuing any of these practices and requiring it to implement a comprehensive privacy and data security program. The stipulation has been filed in federal court in the Southern District of Florida and awaits approval.

Tuesday, April 16, 2024

Bureau of Consumer Protection: Debt Relief

  • The FTC’s lawsuit related to a student debt relief scam which has been pending since August 2023 has resolved via a settlement with the last remaining defendant, Marco Manzi. The complaint alleged that Manzi held himself out as an officer of a company that purported to provide relief, for a fee, under the Biden-Harris Administration Student Debt Relief Plan. This conduct allegedly violated the FTC’s Telemarketing Sales Rule, Section 5(a) of the FTC Act, and Section 521 of the Gramm-Leach-Bliley Act due to materially misrepresenting debt relief services. As previously reported on this blog, the other defendants settled in February 2024, leaving Manzi as the lone holdout. The Manzi settlement imposes largely identical requirements as the earlier settlements, including a ban from participating in any telemarketing and a requirement to pay $7.4 million to the FTC.

Office of Policy Planning: Noncompetes

  • FTC Chair Lina M. Khan announced a special Open Commission Meeting this week on its proposed final rule to prevent employers from enforcing noncompete agreements against workers. The meeting will take place virtually on Tuesday, April 23, 2024 at 2PM E.S.T. and, if the Commission votes to authorize public disclosure of the final rule, the FTC’s Office of Policy Planning will give a presentation, and the Commission will then vote on whether to issue the final rule. The rule was originally proposed on January 8, 2023 and received over 26,000 comments.

Thursday, April 18, 2024

Bureau of Competition: Public Outreach

  • The Commission teamed up with the Department of Justice and the U.S. Department of Health and Human Services to launch an online portal,, to allow the public to report potentially unfair and anticompetitive health care practices to the FTC and the DOJ’s Antitrust Division. The portal lists federal laws addressing competition, such as the Sherman Act, and provides examples of conduct that can harm competition in healthcare, such as price fixing. The actual online form to submit a complaint is a simple textbox, and providing contact information is optional. The FTC explains that the new portal supports the current administration’s efforts to lower health care and prescription drug costs.  For those seeking more information, Crowell has posted an alert with additional insights here.

Bureau of Competition: House Advances One Agency Act

  • The House Judiciary Committee voted 16-7 to advance a bill entitled the One Agency Act, with the goal of dissolving the FTC’s Bureau of Competition and making the Department of Justice the sole antitrust enforcer. While prior iterations of the bill have appeared in the House since 2020, this version was introduced by Representative Ben Cline on March 20, 2024. The bill would give the agencies a one year transition period to transfer all FTC antitrust actions, employees, assets, and funding to the DOJ. The bill will now proceed to be voted on by the full House of Representatives.