On March 18, 2019, Len Gordon was quoted in FTC Watch on the challenging times the Federal Trade Commission (FTC) is facing after a series of setbacks in federal court.
One of the cases is a Third Circuit Court of Appeals ruling last month, FTC v. Shire ViroPharma, that held the FTC cannot secure an injunction under Section 13(b) of the FTC Act against a company based on its prior anticompetitive conduct. That section "requires that the FTC have reason to believe a wrongdoer 'is violating' or 'is about to violate the law,'" the court held.
In another blow to the commission, in FTC v. AMG Capital Management, a concurring opinion of Ninth Circuit Court of Appeals Judge Diarmuid O'Scannlain, joined by Judge Carlos Bea, urged the Circuit to sit en banc to review what they see as wrongly decided prior decisions that had allowed the FTC to pursue monetary damages in federal court under Section 13(b) of the FTC Act. The "text and structure of the statute unambiguously foreclose such monetary relief," O'Scannlain wrote.
Gordon agrees with respect to Shire ViroPharma and the concurring opinions in AMG Capital. "If their [the FTC’s] ability to proceed in federal court is grossly limited to only actions where there is ongoing illegal conduct, and if, in the AMG case, the Ninth Circuit were to reconsider the notion of the scope of equitable monetary relief … [and] question the imposition of joint and several liability, that would really change the dynamic when you are negotiating a settlement with the FTC," he said in an interview.
"If you are facing joint and several liability, rolling the dice and going to trial is scary," he added.
One of the cases is a Third Circuit Court of Appeals ruling last month, FTC v. Shire ViroPharma, that held the FTC cannot secure an injunction under Section 13(b) of the FTC Act against a company based on its prior anticompetitive conduct. That section "requires that the FTC have reason to believe a wrongdoer 'is violating' or 'is about to violate the law,'" the court held.
In another blow to the commission, in FTC v. AMG Capital Management, a concurring opinion of Ninth Circuit Court of Appeals Judge Diarmuid O'Scannlain, joined by Judge Carlos Bea, urged the Circuit to sit en banc to review what they see as wrongly decided prior decisions that had allowed the FTC to pursue monetary damages in federal court under Section 13(b) of the FTC Act. The "text and structure of the statute unambiguously foreclose such monetary relief," O'Scannlain wrote.
Gordon agrees with respect to Shire ViroPharma and the concurring opinions in AMG Capital. "If their [the FTC’s] ability to proceed in federal court is grossly limited to only actions where there is ongoing illegal conduct, and if, in the AMG case, the Ninth Circuit were to reconsider the notion of the scope of equitable monetary relief … [and] question the imposition of joint and several liability, that would really change the dynamic when you are negotiating a settlement with the FTC," he said in an interview.
"If you are facing joint and several liability, rolling the dice and going to trial is scary," he added.