Supreme Court Limits FTC Authority to Recover Ill-Gotten Gains

The Supreme Court, ruling Thursday in AMG Capital Management v. Federal Trade Commission, sharply limited the FTC’s ability to obtain restitution for individuals harmed by companies’ unlawful trade practices. Disagreeing with years of FTC practice and numerous decisions by appellate courts, the Court ruled that a key provision in the FTC Act “does not authorize the Commission to seek, or a court to award, equitable monetary relief such as restitution or disgorgement.” As a result of the decision, the FTC must now go through a burdensome administrative process to force companies to give up ill-gotten gains rather than going directly to court. Acting Chairwoman Rebecca Kelly Slaughter responded that the decision is a ruling “in favor of scam artists and dishonest corporations, leaving average Americans to pay for illegal behavior.” Members of Congress have already proposed amendments to Section 13(b) of the FTC Act that would restore the Commission’s power to seek consumer redress. EPIC routinely advocates before the FTC for meaningful financial penalties against companies whose unlawful data and privacy practices harm consumers.

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