“The Supreme Court has seized a great chance to reconnect the judiciary’s reading of the FTC Act to what the FTC Act actually says.”
—Corbin K. Barthold, WLF Senior Litigation Counsel
(Washington, DC)—The U.S. Supreme Court today granted review of a Ninth Circuit ruling that misreads an FTC Act remedy provision. WLF filed an amicus brief in support of the petition for review.
Section 13(b) of the FTC Act empowers the FTC to sue, in federal court, to obtain an injunction against deceptive trade practices. At least seven courts of appeals have said, however, that the word “injunction” in section 13(b) unlocks the entire vault of equitable remedies.
WLF’s brief urged the Supreme Court to review two Ninth Circuit decisions that affirm restitution awards meted out under section 13(b). WLF argued that the lower courts’ rewriting of section 13(b) resembles the English common-law courts’ use of the “equity of the statute,” a doctrine that empowered a judge to enforce his subjective sense of justice rather than a law’s text. The “equity of the statute” arose in the Late Middle Ages. It gradually died out, however, as judges came to realize that it is inconsistent with democratic governance.
In the mid-twentieth century the Supreme Court briefly adopted a new version of the equity of the statute to “imply” new rights and remedies into laws. The courts of appeals relied on that mid-twentieth century jurisprudence to justify stretching section 13(b). But as WLF explained in its brief, the Supreme Court later reversed course. It came to recognize that it is solely for Congress to decide how, and by whom, its statutes are enforced.
WLF plans to file a brief at the merits stage urging the Supreme Court to align the federal courts’ interpretation of section 13(b) with the modern and binding rules of statutory interpretation.
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