Supreme Court Case Tests FTC’s Powers to Recoup Ill-Gotten Gains

Supreme Court Case Tests FTC’s Powers to Recoup Ill-Gotten Gains

WASHINGTON—Supreme Court justices voiced mixed views Wednesday about whether a U.S. consumer-protection agency has broad authority to demand that defendants who cheat or deceive the public must return the money they gain from that activity.

Justices across the ideological spectrum acknowledged that the Federal Trade Commission for decades has been going to court to seek financial redress from companies and individuals who allegedly engage in scams and unfair business practices. And until recent years, lower courts had uniformly ruled that the FTC had the power to do so.

But many of the same justices also suggested the text of the relevant 1973 law, which gives the FTC the right to seek court injunctions against nefarious activity, doesn’t explicitly give it the right to seek financial judgments as well.

“If it is a mistake, it has been around for 50 years,” said Justice Stephen Breyer, adding that courts sometimes have to let “bygones be bygones.”

But Justice Breyer also said the FTC in recent years had been seeking to recover money in cases that weren’t necessarily egregious, which raised concerns about fairness to the business community.

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