Committee to Move FTC Act S. 13(b) Proposal ‘Shortly’: Cantwell

The Senate Commerce Committee will “mark something up shortly” in response to the Supreme Court’s decision in AMG Capital Management v. FTC, Chair Maria Cantwell, D-Wash., told us Thursday (see 2104220068). House Commerce Committee Republicans said the high court’s unanimous decision shows the FTC exceeded its FTC Act Section 13(b) authority. They expressed frustration that Democrats “prevented” the full commission from testifying Tuesday, when acting Chair Rebecca Kelly Slaughter will appear before the House Consumer Protection Subcommittee.

Cantwell allowed all commissioners to testify last week, said subcommittee ranking member Gus Bilirakis, R-Fla., in a statement. It's “inappropriate” for Slaughter to say the Supreme Court sided with scam artists and dishonest corporations in its decision, he said: “I am hopeful that we can work together to develop a bipartisan fix.”

SCOTUS sent a clear signal the agency exceeded its authority, a House Commerce Committee aide said in a statement, while criticizing Slaughter’s comments: “Such rhetoric does not advance our efforts in Congress to pursue a bipartisan solution that protects consumers and prioritizes due process.”

It’s “really important” for Congress to protect consumers’ right to be individually compensated, House Consumer Protection Subcommittee Chair Jan Schakowsky, D-Ill., told us Thursday after the decision. Offices for Slaughter and House Commerce Committee Chairman Frank Pallone, D-N.J., didn’t comment Monday.

All four FTC members signaled to Senate Commerce that they don’t want to lose their authority, Cantwell told us in reaction to the decision: “All the more reason we have to act very quickly. So we’ll mark something up shortly.” Ranking member Roger Wicker, R-Miss., noted the FTC Act has other sections besides Section 13, but he declined to comment further until he does “more than just see the headlines.” Cantwell hasn’t introduced anything yet. Last year’s privacy proposal from Wicker would clarify Section 13(b) language.

“The Supreme Court’s unanimous decision underscores the need for Congress to amend the FTC Act, in particular to enable the Commission to seek redress for consumers harmed by fraud,” Commissioner Noah Phillips said in a statement.

Schakowsky, in a statement with Rep. Tony Cardenas, D-Calif., said it’s vital to pass the Consumer Protection and Relief Act, a bill Cardenas introduced to restore the agency’s authority. The subcommittee will discuss the legislation Tuesday. “We look forward to working with all our colleagues on this critical legislation to get money back in the pockets of hard-working Americans,” they said.

The ruling “deals a devastating blow” to the FTC and consumers, “seemingly turning the agency into a paper tiger,” tweeted Sen. Richard Blumenthal, D-Conn. Slaughter thanked Blumenthal for “highlighting the disastrous consequences of this decision. I look forward to continuing to work with you to aggressively fight illegal conduct that hurts consumers and honest businesses.” Even if Congress acts on the decision, the agency should deploy its “dormant” penalty offense authority through “Section 5(m)(1)(B)” and “trigger broader sanctions for bad actors through Section 18,” tweeted Commissioner Rohit Chopra. Offices for Chopra and Commissioner Christine Wilson didn’t comment.

A careful read of Sections 13 and 19 shows Congress set a “careful path” to obtain monetary relief, former Republican Commissioner Maureen Ohlhausen told a Federalist Society event Friday. The top court made the right decision, she said. “I don’t blame” the FTC for using the authority, but the agency continually pushed the envelope, which caused a “very hard look at the foundation” of the statute, she said. The decision now “lays it at the feet of Congress to more carefully delineate the powers that it wants to give agencies,” she said. Ohlhausen was “surprised” the decision was unanimous, as was ex-General Counsel Alden Abbott, now a senior research fellow at George Mason University's Mercatus Center. He thought Justice Sonia Sotomayor might have dissented. He wrote about the need to protect certain forms of redress for the benefit of consumers.