Last week, United States (U.S.) Senate Commerce, Science, and Transportation Committee Chair Maria Cantwell (D-WA) issued a staff report on and a bill to restore the Federal Trade Commission’s (FTC) historical use of authority granted under Section 13(b) of the FTC Act the Supreme Court of the U.S. (SCOTUS) struck down in AMG Capital Management, LLC v. FTC. In that case, SCOTUS found that term “permanent injunction” in 15 U.S.C. 53(b) (aka Section 13(b)) does not allow the agency to seek and receive “equitable monetary relief such as restitution or disgorgement.” For decades, the FTC has gone to court to ask for forms of equitable monetary relief like restitution or disgorgement so that bad actors are forced to return ill-gotten funds to the people they cheated or defrauded. The FTC also sought to use these powers in conjunction with illegal activity that happened in the past and was no longer ongoing.
In writing for the Court, Justice Stephen Breyer framed the issue to be decided:
Did Congress, by enacting §13(b)’s words, “permanent injunction,” grant the Commission authority to obtain monetary relief directly from courts, thereby effectively bypassing the process set forth in §5 and §19?
SCOTUS ruled that “permanent injunction” does not provide the authority to seek monetary relief:
Several considerations, taken together, convince us that §13(b)’s “permanent injunction” language does not authorize the Commission directly to obtain court-ordered monetary relief. For one thing, the language refers only to injunctions. It says, “in proper cases the Commission may seek, and after proper proof, the court may issue, a permanent injunction.” 15 U. S. C. §53(b) (emphasis added). An “injunction” is not the same as an award of equitable monetary relief… We have, however, sometimes interpreted similar language as authorizing judges to order equitable monetary relief.
However, SCOTUS did not find the language in the FTC Act permitted judges to order equitable monetary relief:
But if this language alone is not enough, there is more. The language and structure of §13(b), taken as a whole, indicate that the words “permanent injunction” have a limited purpose—a purpose that does not extend to the grant of monetary relief. Those words are buried in a lengthy pro- vision that focuses upon purely injunctive, not monetary, relief.