To kick off this year’s National Advertising Division Annual Conference, Andrew Smith—the FTC’s new Director of the Consumer Protection Bureau—discussed his views on the Commission’s priorities with respect to remedies, privacy and data security, and national advertising cases. Given the backgrounds of the new Commissioners, Director Smith acknowledged that some of them may be re-thinking—or just thinking—deeply about consumer protection remedies. According to the Director, the Commission has revived the Remedies Task Force to answer the following question: what is the right way to redress a particular harm the Commission highlights? Although this appears to be a particularly tough question in non-fraud cases, when it comes to remedies, the Commissioners have their minds on the money and the money on their minds.
The FTC considers monetary remedies as providing not only some measure of redress for consumers, but also respect for the agency more broadly. While we recently hinted at the Commission’s remedies reexamination, Director Smith made it clear that the Commission has had many discussions about money and proposed settlements sent to the Commissioners invariably come back with either the question of “why is there no money” or “why isn’t there more money?” In fraud cases, the monetary remedy is straightforward—companies would simply give the money back. In non-fraud cases, however, while the FTC under at least some court decisions might be able to seek full redress, the agency is considering a range of remedies in an effort to seek some sort of less drastic and presumably fairer monetary recompense. For example, the Commission may consider any premiums a consumer would pay for a product, such as when it is “Made in the USA.” Similarly, the FTC may examine whether there were increased sales, assuming sufficient comparative sales data is available. In short, he echoed what we have said previously which is that when it comes to FTC settlements and remedies, it is definitely not business as usual.
Director Smith closed his remarks with a few words on what’s coming down the pipeline. He anticipates even more “Made in the USA” cases and stated that, although some have speculated to the contrary, from what he can tell, there is no hostility by this Republican-leaning Commission to National Advertising cases. In fact, he noted that some National Advertising cases are currently in the works. We will certainly be keeping track of these cases and more as the Commission wraps up 2018 and looks ahead to its first full calendar year under new leadership.