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Rohit Chopra

FTC Initiates Action on New Earnings Claims Rule
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FTC Initiates Action on New Earnings Claims Rule

Commissioners vote unanimously to seek public comment on potential rule targeting direct sellers and other gig economy businesses

By:  David Bland

The Federal Trade Commission (FTC) continues its post-AMG Capital Management push to prepare other weapons for use against direct sellers in the absence of injunctive monetary relief via Section 13(b), which was stripped by the Supreme Court in Spring 2021.

Eleven months after announcing a new rulemaking group to reinvigorate and streamline its Section 18 powers, the FTC conducted a virtual open meeting to announce, accept public comments on, and vote on the publication of its Advanced Notice of Proposed Rulemaking (ANPR) Concerning Deceptive Earnings Claims in the Federal Register. The agenda for this meeting also included a vote on issuing orders to large pharmacy benefits managers (PBM) to study the competitive impact of its policies affecting independent or specialty pharmacies.

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March 1, 2022 0 comment
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US Chamber Leads Pushback Against ‘Rogue’ FTC
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US Chamber Leads Pushback Against ‘Rogue’ FTC

Business and legal observers submit their objections to recent changes

By:  David Bland

Words matter, and the deliberate deletion of ‘legitimate business activity’ from the FTC’s draft Mission Statement is material and meaningful. This move is likely to trigger another hostile response, creating an unnecessary distraction of the Agency’s own making.

— John Villafranco, Partner, Kelley Drye & Warren LLP

The U.S. Chamber of Commerce, the nation’s most powerful corporate lobbying group and a long-time adversary of the Federal Trade Commission (FTC), sent three letters to Commission Chairwoman Lina Khan on Nov. 19, objecting to recent actions by the Commission that the Chamber considers to be abuses of power.

In an incendiary accompanying statement, U.S. Chamber President and CEO Suzanne P. Clark said: “The FTC is waging a war against American businesses, so the U.S. Chamber is fighting back to protect free enterprise, American competitiveness, and economic growth.”

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January 1, 2022 0 comment
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FTC Continues Its Mission Makeover and Streamlining of Rulemaking Procedures
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FTC Continues Its Mission Makeover and Streamlining of Rulemaking Procedures

Commission approves changes to ‘democratize the process’ and encourage public participation

In addition to formal rulemaking, the new changes will also apply to requests by certain parties [including the direct selling channel] for special exemption from FTC rules, as well as petitions related to industry guidance issued by the Commission.

—Federal Trade Commission

Marking a continued effort to implement streamlining and overhauls to its rulemaking procedures authorized under Section 18 of the FTC Act, the Federal Trade Commission (FTC) held a virtual open meeting on Sept. 15, 2021. One of the items on the agenda was a vote to approve changes in the Rules of Practice and other rules affecting public access to the petition component of the FTC’s rulemaking process.

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October 1, 2021 0 comment
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FTC Threat: A Primer
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FTC Threat: A Primer

Your questions answered on the FTC’s new battle plan against direct sellers

By:  David Bland

Is the direct selling channel under greater threat now from FTC action than it has been previously?

All signs point to yes. While the FTC has spent the past few decades consistently taking action against several direct selling companies accused of operating as pyramid schemes, the overall scope of this action has been limited. However, over the past year, the Commission has expressly stated that the direct selling channel is on the short list for renewed FTC scrutiny and enforcement. Furthermore, in a move catalyzed by the Supreme Court decision on 13(b) to strip the agency of its restitutive monetary relief powers, commissioners have begun the process to create new weapons for winning both equitable and punitive monetary relief in future proceedings.  

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September 1, 2021 0 comment
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FTC 2.0 – In Their Own Words
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FTC 2.0 – In Their Own Words

Commissioners outline an aggressive new strategy with direct sellers in their sights.

The Federal Trade Commission is in the midst of a sea change—a change in leadership, a change in ideology and a change in philosophy. Signaling the most significant course correction of the past 40 years, the Commission is reversing a self-imposed disarmament from the 1980s deregulation era while at the same time asking Congress to strengthen its powers under the FTC Act. This revitalized Commission has also released a target list, and direct selling is on it. 

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September 1, 2021 0 comment
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FTC on the Defensive as Supreme Court Addresses Section 13(b)
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FTC on the Defensive as Supreme Court Addresses Section 13(b)

Skeptical court probes FTC’s approach to seeking ill-gotten gains

By:  Larry Steinberg, Guest Contributor

If the FTC loses this case, the agency will no longer be able to rely on Section 13(b) to obtain an order requiring a wrongdoer to return all of the money it illegally obtained.

FTC Commissioner Rohit Chopra, who will leave the FTC  after the  Senate confirms him as the newly appointed director of the Consumer Financial Protection Bureau, is known as one of the more prolific commissioners. He has spoken and written extensively in his three years on the FTC including, notably, in a November 2020 paper wherein he called the AMG Capital Management v. Federal Trade Commission case an “existential threat to the agency’s ability to hold wrongdoers accountable.” 

The previous month, in a letter to Congress, Commissioner Chopra, joined by the other four FTC commissioners, described Section 13(b) as the primary tool that the FTC uses to return money to consumer victims, and pleaded for Congress to amend the statute so that it would expressly provide for monetary relief.

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February 1, 2021 0 comment
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