On Thursday, in a unanimous decision written by Justice Stephen Breyer, the Supreme Court ruled that the Federal Trade Commission (FTC) does not have the
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The US Supreme Court ruled last week that the Federal Trade Commission doesn’t have the authority to seek equitable monetary relief in federal court under Section 13(b) of the FTC Act in
The text of Section 13(b) expressly allows the Commission to seek injunctive relief (temporary restraining orders or preliminary injunctions in aid of administrative proceedings, as well as permanent injunctions in “proper cases”), but is silent on whether the agency can also seek equitable monetary relief. Nonetheless, courts for years have ordered consumer redress, including disgorgement and restitution under Section 13(b) in response to agency requests.
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On Thursday, in a unanimous decision written by Justice Stephen Breyer, the Supreme Court ruled that the Federal Trade Commission (FTC) does not have the authority to seek equitable monetary relief, reversing a previous Ninth Circuit judgment.
In the lawsuit, the FTC sued AMG Capital Management LLC and others, alleging that the defendants’ payday lending practices were deceptive and violated §5(a) of the Federal Trade Commission Act. The District of Nevada granted the FTC’s request under §13(b) of the act for an injunction to prevent future violations as well as for the defendants to pay $1.27 billion for restitution and disgorgement. The Ninth Circuit rejected defendant AMG Capital Management’s claim that §13(b) does not authorize the award of equitable monetary relief.
US Supreme Court: FTC Cannot Seek Equitable Monetary Relief in Section 13(b) Cases | Morgan Lewis jdsupra.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from jdsupra.com Daily Mail and Mail on Sunday newspapers.
U.S. Supreme Court Limits the FTC’s Authority to Seek Monetary Relief in Deceptive Practices Enforcement Cases Friday, April 23, 2021
In a unanimous decision released on April 22, 2021, the U.S. Supreme Court upended decades of lower court precedent by finding that Section 13(b) of the Federal Trade Commission Act (FTC Act) does not authorize the FTC to seek, or a court to award, equitable monetary relief such as restitution or disgorgement. Instead, in
AMG Capital Management, LLC v. FTC,
1 the Court pointed to other sections of the FTC Act, notably the administrative procedures contained in section 5 and the consumer redress available under section 19, as the proper legal avenues for the FTC to seek consumer redress and restitution in most cases. The ruling substantially curbs the FTC’s ability to obtain consumer redress under section 13(b), the FTC’s preferred means of seeking monetary damages due to its administrative efficiency compared to other Commission