Monday, November 15, 2021

Financial Management Office: FTC Operations

  • The FTC issued its Fiscal Year 2021 Agency Financial Report outlining financial and high-level performance results and highlighting recent agency accomplishments. The 98-page report also contains an overview of the agency’s mission and organization, an independent auditor’s report of the FTC’s 2020 and 2021 financial statements, and the Office of the Inspector General’s assessment of the FTC’s top management and performance challenges.


Continue Reading FTC Updates (November 15-19, 2021)

Monday, November 8, 2021

Antitrust: Hart-Scott-Rodino Act

  • The Federal Trade Commission and the Justice Department’s Antitrust Division released the agencies’ 43rd Annual Hart-Scott-Rodino Report. The report provides HSR Premerger Notification data for fiscal year 2020, and its release coincides with an unprecedented surge in pre-merger filings during the current fiscal year.


Continue Reading FTC Updates (November 8-12, 2021)

Tuesday, November 2, 2021

Deceptive or Misleading Conduct & Consumer Protection

  • The FTC recently issued full refunds totaling over $2 million to consumers who lost money through certain deceptive direct mail schemes. The agency recovered the refunds via a federal district court order resulting from the FTC’s lawsuit against Agora Financial, LLC, NewMarket Health, and other defendants. The lawsuit was based upon two publications defendants marketed to older consumers. One publication contained a protocol promising to permanently cure type 2 diabetes in 28 days, while the other promised to show how to claim money from a secret giveaway by Congress. The FTC obtained the order including consumer refunds before the Supreme Court stripped the agency of its ability to obtain equitable monetary relief in federal court in the April 22, 2021 AMG Capital decision. Congress has not yet acted on the FTC’s request to reinstate this power.


Continue Reading FTC Updates (November 1-5, 2021)

Monday, October 25, 2021

Bureau of Competition and FTC Operations

  • The FTC issued a policy statement restoring its pre-1995 practice of requiring parties under a merger consent decree to obtain the Commission’s permission before pursuing additional acquisitions in that market. This “Prior Approval” policy is designed to protect consumers and deter “clearly anticompetitive” deals, per Holly Vedova, the Director of the Bureau of Competition. The FTC will consider a number of factors when deciding whether to permit a deal, including (1) the nature of the transaction, (2) the level of market concentration and the degree to which the transaction increases market concentration, (3) the degree of pre-merger market power, (4) the parties’ history of acquisitiveness, and (5) evidence of anticompetitive market dynamics. The Commission approved the statement by a vote of 3-2; the Commissioners voting against the policy subsequently issued a dissenting statement.


Continue Reading FTC Updates (October 25-29, 2021)

Monday, October 18, 2021

Deceptive or Misleading Conduct & Protecting Older Consumers

  • The FTC issued its latest report to Congress on protecting older consumers, which highlights updated findings from the Commission’s fraud reports showing trends in how older adults report being affected by fraud with the most frequent type of fraud reported by older adults

Last week the Supreme Court unanimously held that §13(b) of the Federal Trade Commission Act does not give the Federal Trade Commission the power to seek equitable monetary relief such as disgorgement or restitution. The Court’s opinion in AMG Capital Management LLC v. Federal Trade Commission removes a powerful tool that the FTC has long relied on to pursue monetary relief for consumers in both consumer protection and competition matters.

By way of background, the FTC has authority to protect consumers from unfair or deceptive acts or practice (“UDAP”) and unfair methods of competition (“UMC”) with an overlapping but distinct set of tools it can use to pursue its dual consumer protection and competition missions:

  • Administrative Proceeding: The FTC can initiate an administrative proceeding to seek a cease and desist order for either a UDAP or UMC violation from an administrative law judge. If necessary, the FTC can later bring a contempt proceeding in federal court seeking to enforce the terms of an administrative order. A defendant may respond by arguing that it has “substantially complied” with the terms of the order. If the FTC prevails in such a case, it can seek civil penalties and other equitable relief necessary to enforce the order (however monetary relief only applies to UDAP violations).
  • Rulemaking: The FTC has authority to promulgate rules that define UDAP with specificity. Generally, this requires a lengthy, formal rulemaking process that allows for public comment, and a final rule can be challenged in federal court. If a defendant later violates a duly enacted UDAP rule, the FTC can seek civil penalties for a knowing violation. The FTC can also file suit in federal court and obtain monetary relief “to redress consumer injury,” including an order compelling “refund of money or return of property,” but only if “a reasonable man would have known under the circumstances [that the challenged conduct] was dishonest or fraudulent.”
  • Federal Court: The FTC can sue in federal court under §13(b) of the FTC Act to enjoin a defendant when the defendant “is violating, or is about to violate” a law that the FTC enforces and such an injunction is in the public’s interest. While courts have historically read §13(b) as giving the FTC an implied right to recover equitable monetary relief in addition to injunctive relief, the Supreme Court’s ruling now limits the FTC to seeking injunctive relief only.


Continue Reading The Supreme Court Limits FTC’s §13(b) Powers

On April 15, 2021, the FTC filed its first complaint under the COVID-19 Consumer Protection Act (the CCP Act). The complaint, filed in the United States District Court for the Eastern District of Missouri, alleges that an in-state chiropractor and his company violated both the CCP Act and the FTC Act by deceptively marketing Vitamin

Promotional products seller Gennex Media LLC and its owner, Akil Kurji, have settled Federal Trade Commission (“FTC”) charges that they made false, misleading, or unsupported advertising claims that their “Brandnex” customizable promotional products were “all or virtually all” made in the United States. Despite numerous claims that the company’s novelty items were “Made in the USA,” “USA Made,” and “Manufactured Right Here in America!”, the items were wholly imported from China.

The settlement requires Gennex and Kurji to pay the FTC a monetary judgment of $146,249.24. In addition to the payment, the parties are required to follow post-settlement remediation measures. Some of these measures include: (1) providing customer information to the FTC in order to ensure proper customer redress; (2) submitting compliance reports to the FTC one year post-settlement; and (3) maintaining certain business records for five years.
Continue Reading Made in USA Settlement for Chinese Imports

On March 25th, the Federal Trade Commission (FTC) announced that the agency is creating a new and dedicated “rulemaking group” within the FTC’s Office of the General Counsel.  Currently, rulemaking within the FTC is decentralized and individual bureaus are responsible for promulgating particular rules.  With this new group in place, Acting Chairwoman Rebecca Slaughter explained, the FTC can take a harmonized approach to rulemaking across its different authorities in order to prohibit unfair and deceptive trade practices and unfair methods of competition.  This move is significant because, although the FTC has declined to engage in rulemaking for many years, it has signaled its desire for stricter enforcement for some time.  Just last year, the FTC promulgated a new “Made in USA” labeling rule in order to make the standards clear and to enable the Commission to seek civil penalties for any violations.

Continue Reading Harmonized Approach to Rulemaking: FTC Announces New Rulemaking Group