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Supreme Court Makes It Harder for the FTC to Protect Consumers From Rip-Offs

WASHINGTON, D.C. – The U.S. Supreme Court issued an opinion today in AMG Capital Management, LLC v. FTC, holding that Section 13(b) of the Federal Trade Act does not empower the Federal Trade Commission (FTC) “to seek, or a court to award, equitable monetary relief such as restitution” or other restorative relief. Public Citizen filed an amicus brief arguing that 13(b) does grant the Commission power to ask a court, and a court to issue, restorative relief for those who have been harmed. Robert Weissman, president of Public Citizen, released the following statement response to the Court’s opinion:

“Today’s decision will make it much harder for the FTC to do its job of protecting consumers and will embolden corporate wrongdoers. Under the Court’s ruling, in many cases, the FTC will only be able to force corporations that rip off consumers to pay them back if the agency had previously told them to stop. Corporate scamsters, flim-flam artists, swindlers, cheats, and others don’t deserve a warning before being held accountable.

“The FTC used Section 13(b) to protect consumers against corporate wrongdoing. According to the FTC, in FY 2019, the agency sought court orders requiring corporate defendants to pay more than $723 million in restorative relief. Unfortunately, the Supreme Court disagrees with the many appellate courts that have held that 13(b) gives the FTC the authority to seek, and a court to require, defendants to restore the ill-gotten gains from the illegal activity to the victims of the violation.

“The good news is that the Supreme Court expressly noted in its opinion that Congress has the ability to grant the FTC this authority. We urge Congress to quickly do just that.”