Amendments to the Federal Trade Commission Act

(a)

Provision of equitable relief; authority To refer to the Attorney General

(1)

In general

Section 13 of the Federal Trade Commission Act (15 U.S.C. 53) is amended by adding at the end the following:

(e)

Equitable relief

(1)

Restitution; contract rescission and reformation; refunds; return of property respecting unfair or deceptive acts or practices

(A)

In general

Subject to paragraph (4), in a suit brought under subsection (b)(2)(B), the Commission may seek, and the court may order—(i)restitution for consumer loss that the court has a sound basis to conclude resulted from such violation;(ii)rescission or reformation of contracts; or(iii)the refund of property.(B)

Limitations period

In a suit brought under subsection (b)(2)(B), the Commission may bring a claim for relief under this paragraph not later than 3 years after the date on which the violation that gives rise to the suit in which the Commission seeks the claim occurs. (2)

Disgorgement respecting unfair or deceptive acts or practices

(A)

In general

Subject to paragraph (4), in a suit brought under subsection (b)(2)(B), the Commission may seek, and the court may order, disgorgement of any unjust enrichment the court has a sound basis to conclude that a person, partnership, or corporation obtained as a result of that violation.(B)

Calculation

Any amount that a court orders a person, partnership, or corporation to pay under subparagraph (A) shall be offset by any amount a court orders the person, partnership, or corporation to pay or to return under paragraph (1)(A) and shall not exceed the net profits directly related to the violation by the person, partnership, or corporation.(C)

Limitations period

In a suit brought under subsection (b)(2)(B), the Commission may bring a claim for disgorgement under this paragraph not later than 3 years after the date on which the violation that gives rise to the suit in which the Commission seeks the claim occurs.(3)

Calculation of limitations periods

For purposes of calculating any limitations period under paragraph (1) or (2), any time in which a person, partnership, or corporation against which such equitable relief is sought is outside the United States shall not be counted for purposes of calculating such period.(4)

Burden of proof; presumption

(A)

Burden of proof

The court may order equitable relief under paragraph (1) or (2) only if the Commission proves that—(i)the act or practice which relates to the violation that gives rise to the suit in which the Commission seeks such relief is an act or practice that a reasonable individual would have known, under the circumstances, was unfair or deceptive within the meaning of section 5(a)(1); and(ii)a reasonable individual—(I)materially relied on such act or practice; and(II)such act or practice proximately caused harm to the individual.(B)

No presumption of material reliance

For purposes of subparagraph (A)(ii)(I), the court may not presume that an individual materially relied on any unfair or deceptive acts or practices solely on the basis of a finding that such individual was exposed to such unfair or deceptive acts or practices.(f)

Referral by the Commission

In any action brought by the Commission under this section involving an unfair method of competition in which the court rules in favor of the Commission, the Commission may refer the action to the Attorney General to collect actual damages under section 4A(b) of the Clayton Act.

(2)

Conforming amendments

Section 13 of the Federal Trade Commission Act (15 U.S.C. 53) is amended by striking subsection (b) and inserting the following:

(b)

Temporary restraining orders; preliminary and permanent injunctions; other relief

Whenever the Commission has reason to believe—(1)that any person, partnership, or corporation has violated, is violating, or is about to violate any provision of law enforced by the Federal Trade Commission; and(2)that either—(A)the enjoining thereof pending the issuance of a complaint by the Commission and until such complaint is dismissed by the Commission or set aside by the court on review, or until the order of the Commission made thereon has become final, would be in the interest of the public; or (B)the permanent enjoining thereof or the ordering of equitable relief under subsection (e) would be in the interest of the public,

the Commission by any of its attorneys designated by it for such purpose may bring suit in a district court of the United States to obtain such injunction or relief. In a case brought under paragraph (2)(A), upon a proper showing that, weighing the equities and considering the Commission's likelihood of ultimate success, a temporary restraining order or preliminary injunction would be in the public interest, and after notice to the defendant, a temporary restraining order or a preliminary injunction may be granted: Provided, however, That if a complaint is not filed within such period (not exceeding 20 days) as may be specified by the court after issuance of the temporary restraining order or preliminary injunction, the order or injunction shall be dissolved by the court and be of no further force and effect: Provided further, That in a case brought under paragraph (2)(B), after proper proof, the court may issue a permanent injunction, equitable relief under subsection (e), or any other relief as the court determines to be just and proper, including temporary or preliminary equitable relief. Any suit under paragraph (2) may be brought where such person, partnership, or corporation resides or transacts business, or wherever venue is proper under section 1391 of title 28, United States Code. In addition, the court may, if the court determines that the interests of justice require that any other person, partnership, or corporation should be a party in such suit, cause such other person, partnership, or corporation to be added as a party without regard to whether venue is otherwise proper in the district in which the suit is brought. In any such suit, process may be served on any person, partnership, or corporation wherever it may be found.

(b)

Amendments to authority To commence or defend litigation

(1)

In general

Section 16(a)(2) of the Federal Trade Commission Act (15 U.S.C. 56(a)(2)) is amended—(A)in subparagraph (A), by striking (relating to injunctive relief); and(B)in subparagraph (B), by striking (relating to consumer redress).(2)

Technical amendment

Section 16(a)(2)(D) of the Federal Trade Commission Act (15 U.S.C. 56(a)(2)(D)) is amended by striking subpena and inserting subpoena.(c)

Applicability

The amendments made by subsections (a) and (b) shall apply with respect to any action or proceeding that is commenced on or after the date of enactment of this Act.