Plain-English summary
Court: FTC lacks authority under Section 13(b) to obtain restitution or disgorgement
The Supreme Court unanimously held that Section 13(b) of the Federal Trade Commission Act does not authorize the FTC to seek equitable monetary relief such as restitution or disgorgement in court. The Court reversed the Ninth Circuit and remanded the case.
Why this matters
The decision limits the FTC’s ability to recover money directly through Section 13(b) lawsuits, which was a common and fast tool the agency used to return money to consumers or strip ill-gotten gains from wrongdoers. The ruling may require the FTC to rely on other statutory provisions or on Congress to grant clearer authority to pursue monetary relief, potentially slowing or changing how consumer restitution and penalties are obtained.
Who may feel it
- Consumers who receive refunds or restitution from FTC actions
- Companies and individuals accused of unfair or deceptive practices
- The FTC and other federal enforcement agencies
- Courts that hear consumer-protection litigation
- Congress, which may be asked to clarify the law