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1 1 (December 23, 2019)

handle is hein.crs/govebbc0001 and id is 1 raw text is: Congressional ______ ~.Research Service Will the FTC Need to Rethink its Enforcement Playbook (Part II)? Circuit Split Casts Doubt on the FTC's Ability to Seek Restitution in Section 13(b) Suits December 23, 2019 Earlier this year, the U.S. Court of Appeals for the Seventh Circuit held in FTC v. Credit Bureau Center LLC, that the Federal Trade Commission (FTC or Commission) cannot obtain restitution (i.e., repayment of money for consumer redress) in suits under Section 13(b) of the Federal Trade Commission Act (FTC Act). In so doing, the Seventh Circuit overturned its own precedent and created a split of opinion on this issue with eight other federal courts of appeals. The Credit Bureau Center decision also adds to recent case law curtailing the FTC's enforcement authority under Section 13(b) in other respects, including a decision by U.S. Court of Appeals for the Third Circuit earlier this year (discussed in an earlier Sidebar) limiting the FTC's ability to bring Section 13(b) suits at all. Credit Bureau Center has significant implications for the FTC's enforcement practices. The Commission generally lacks authority to impose civil monetary penalties when bringing suits based on a defendant's first-time violation of the FTC Act. Consequently, the FTC has instead relied on restitution under Section 13(b) to obtain monetary relief in such suits. Unless and until the Supreme Court resolves the newly- created split among the circuits as to whether restitution is available in Section 13(b) suits, the FTC will have different enforcement powers in different jurisdictions, and may be limited to seeking primarily non- monetary injunctive relief and cease-and-desist orders from courts within the Seventh Circuit. This Sidebar begins by placing Section 13(b) in its context within the FTC Act's enforcement framework. It then discusses past federal appellate court decisions interpreting the remedies available under Section 13(b). The Sidebar then details the reasoning of the Seventh Circuit in Credit Bureau Center and considers the decision's implications for FTC enforcement actions and Congress. FTC Act's Enforcement Framework The FTC Act established the FTC in 1914, setting forth the agency's dual mission of protecting consumers and promoting competition. Along with enforcing several statutes addressing specific types of Congressional Research Service https://crsreports. congress.gov LSB10388 CRS Legal Sidebar Prepared for Members and Committees of Congress

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