Consumer Redress Under Section 13(b) of the FTC Act: Correcting the Record

Posted 01 November 2010 | By

For nearly 30 years, the Federal Trade Commission (FTC) has sought, and federal courts have awarded, monetary redress for consumers in actions brought under Section 13(b) of the Federal Trade Commission Act (FTC Act), 15 U.S.C. § 53(b). Often, such awards have taken the form of restitution measured by the full amount of consumer loss (i.e., the total amount spent by consumers on the product or service at issue), rather than simply disgorgement (an equitable remedy requiring the wrongdoer to give up its ill-gotten enrichment) of a defendant's unjust gains. Not surprisingly, many judgments have run into the many millions of dollars.1 Despite the prospect of a significant damages award in a Section 13(b) case, remarkably few litigants have challenged the form and measure of monetary relief (assuming that such relief even may be awarded under the statute in the first instance2). Moreover, courts that have considered the appropriate form and measure of redress in Section 13(b) actions often have used the terms "restitution" and "disgorgement" with such imprecision that their decisions have added to the confusion about what types of monetary redress are, in fact, available under the statute (if any).


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