5/12/21 FTC Loses Half Its Teeth in Unanimous SCOTUS Decision

In recent years, the Federal Trade Commission (FTC) has clawed back money for defrauded consumers by taking people who scammed those consumers to court. The Supreme Court recently ruled in favor of one such scammer by saying that the FTC was using the wrong method to get that money back.

For decades, the FTC has taken a shortcut by assuming the power to demand restitution. According to the text of the applicable law, though, the FTC is supposed to earn the right to demand restitution: It has to demonstrate that the case merits restitution by issuing injunctions and holding hearings. Only after that can it take the case to court to get the money back.

The FTC's shortcut saves a lot of time and money, but SCOTUS has ruled unanimously that the FTC has to do things the hard way. The liberal justice Stephen Breyer wrote the opinion!

Unfortunately, the SCOTUS decision benefits a scumbag, a Kansas payday loan operator who controlled multiple loan companies. Payday lenders typically wind up getting far more cash back from its borrowers than it extends to them. (The author of our source article, below, calls the business a "quicksand machine that exists to siphon money from the poor and bury consumers in debt.") This payday-loan entrepreneur, Scott King, scammed multiple customers into signing up for recurring loans that ruined their financial lives. The court originally told King to repay $1.3 billion. Now, he doesn't have to.

Moreover, 24 FTC cases now in the works are in jeopardy -- including Facebook's. The FTC filed its lawsuit against Facebook in federal court, where several states were also suing the company. The FTC wants Facebook to divest its acquisitions of two other social-media companies. SCOTUS decided the case in April, and Facebook has already moved to have its FTC lawsuit dismissed because of the SCOTUS decision. The ruling hasn't yet been made.

Another badly weakened lawsuit is the FTC's case against the creepy pharmaceutical exec Martin Shkreli, who with others is accused of inflating the price of a drug called Daraprim by 5,000%. (The drug fights toxoplasmosis, and it's especially helpful in immunocompromised patients, such as AIDS patients.)

It's as if SCOTUS pushed over a wall of a fort with fleeced and gullible people sheltering inside. Under the current political climate, there's no cavalry coming -- yet.

https://slate.com/news-and-politics/2021/05/supreme-court-payday-facebook-martin-shkreli.html?fbclid=IwAR2zAWmrCjDXq8gammgnJdXRqsb2JgSUdkteNFD503SHXoprJn532XkFhD0

How quickly do you think Congress can get its "act" together to pass legislation that will shore up the FTC's enforcement power?

Are there particular antitrust situations that worry you? What about attempts to rein in Facebook's power over our privacy? Will you phone your representative in Congress about this situation?