Consumer Law & Policy Blog

Consumer Federation of America is looking for a Communications Director

CFA has posted this job announcement: The Consumer Federation of America, one of the nation’s leading nonprofit consumer advocacy organizations, is seeking an energetic, proactive person to be Communications Director. This person will be responsible for leading, developing, and overseeing CFA’s communications strategic plan to advance the advocacy policy agenda and promote the programmatic work of America Saves. This work includes development of an editorial calendar, website and social media management, support of advocacy efforts, and efforts to coordinate communications efforts across CFA and America Saves.

Read the full announcement, here.

FTC: Not enough baby formula means plenty of scammers

A Federal Trade Commission Consumer Alert warns about baby-formula scans and offers advice, here.

Some comments on Alan Kaplinsky's comments on my comments

by Jeff Sovern

I am grateful to Alan Kaplinsky for commenting on two of my earlier posts, Whither Arbitration Regulation? and Why the CFPB is right that it can act against discrimination using its unfairness power. One of Alan's posts is titled Why the CFPB’s expansion of its UDAAP authority to target discrimination requires rulemaking. In the other post, Don’t hold your breath, Professor Sovern!, Alan wrote, in response to my urging the CFPB to issue a new arbitration regulation:

Director Chopra already has a very robust agenda for the CFPB. Among other things, that includes rulemakings under Section 1071 of Dodd-Frank (small business loan data collection) and Section 1033 of Dodd-Frank (consumer access to data). Both of these rulemakings are very complex and controversial. The CFPB does not have the bandwidth and resources to take up arbitration which would also undoubtedly be complex and controversial.

Put them together and you have Alan saying the Bureau shouldn't (can't?) use its unfairness power to combat discrimination unless it issues a regulation but that the Bureau is too busy to produce new regulations if they would be complex and controversial. Alan doesn't say explicitly that a discrimination regulation would be complex and controversial, but the issues he raises suggest it would indeed be complex, and the Bureau's claim that discrimination is unfair within the meaning of the Consumer Financial Protection Act has already aroused opposition within the industry. So, on Alan's reasoning, the Bureau would not be able to promulgate a discrimination regulation any time soon and would not be able to use its unfairness power to fight discrimination in the meantime.

I agree that it is desirable for the Bureau to issue a discrimination regulation, but not exactly for the reasons Alan identified, and I don't agree that the Bureau is disqualified from interpreting unfairness as embracing discrimination in the absence of such a regulation. A discrimination regulation would serve several desirable purposes. Among these: it would be persuasive authority for other UDAP statutes, such as the FTC Act and state UDAP statutes. It would also be more difficult for later administrations to abandon a regulation adopted after notice and comment, than changes in a supervisory manual, which a later director could rescind.

Alan also suggests that the Bureau could not issue an arbitration regulation unless it conducts a fresh arbitration study. This seems inconsistent with the text of the Dodd-Frank Act. That Act provides, in section 1028(a) , that the Bureau "shall conduct a study of" arbitration. The Bureau has conducted "a" study. Section 1028(b) states that "The findings in [an arbitration] rule shall be consistent with the study conducted under subsection (a)." In other words, as long as any arbitration rule the Bureau issues has findings consistent with its original arbitration study, the Bureau can issue the rule. Alan is right, though, that a new arbitration rule would take some time, which is why the Bureau needs to get going on it as soon as possible, if it has not already done so.

Attend a panel discussion on the FTC's monetary authority in the wake of the Supreme Court's AMG decision

Join the Washington D.C. ACS Lawyer Chapter for a discussion on the Supreme Court's decision in AMG Capital v. FTC. The panel discussion -- a Zoom webinar -- is on Thursday, May 26, 2022 from 12:30PM - 1:30PM ET.

Register here.

The panelists will discuss the background of the case, it's impact on the agency, what the FTC has been doing to obtain monetary relief since the Supreme Court issued the ruling, legislative proposals to restore the FTC's authority, and how the ruling has affected state law enforcement.

The panelists are:

Audrey Austin, Acting Deputy Director, Bureau of Consumer Protection, Federal Trade Commission
Ted Mermin, Executive Director, Berkeley Center for Consumer Law & Economic Justice
Jessica Whitney, Special Assistant Attorney General and the Director of the Consumer Protection Division, Iowa Attorney General's Office

Nielson Paper Asks What Happens If the FTC Becomes a Serious Rulemaker?

Aaron L. Nielson of Brigham Young has written What Happens If the FTC Becomes a Serious Rulemaker? forthcoming in FTC's Rᴜʟᴇᴍᴀᴋɪɴɢ Aᴜᴛʜᴏʀɪᴛʏ (Concurrences 2022). Here's the abstract:

The Federal Trade Commission (FTC) is no one’s idea of a serious rulemaker. To the contrary, the FTC is in many respects a law enforcement agency that operates through litigation and consent decrees. There are understandable reasons for this absence of FTC rulemaking. Not only has Congress imposed heightened procedural obligations on the FTC’s ability to promulgate consumer protection rules, but it is far from clear that the FTC even has statutory authority to promulgate substantive rules relating to unfair methods of competition (UMC). Yet things may be changing. It appears that the FTC is preparing to begin using rulemaking more aggressively, including for substantive UMC regulations. The FTC’s ability to use rulemaking this way will undoubtedly prompt sharp and important legal challenges.

This short essay, however, considers the question of the FTC rulemaking’s authority from a different angle: What if the FTC has broad rulemaking authority? And what if the FTC begins to use that authority for controversial policies? Traditionally, the FTC operates in a case-by-case fashion that generally attempts to apply familiar principles to the facts of individual matters. Should the FTC begin making broader policy choices through rulemaking, however, it should be prepared for at least three unintended consequences: (i) more ossification, complete with judicial challenges and perhaps even White House oversight; (ii) more zigzagging policy as new FTC leadership, in response to changes in presidential control, moves to undo what the agency has done; and (iii) to more often be the target of what has been called “administrative law as blood sport,” by which political actors make it more difficult for the agency to function, for example by delaying the confirmation process. The upshot would be an agency that could in theory (and sometimes no doubt in fact) regulate more broadly than the FTC does now, but also one with a different character. In short, the more the FTC becomes a serious rulemaker, the more it will change as an institution.

CFP: Symposium on AI, Consumer Credit, and Discrimination

We received the following call for papers:

Nikita Aggarwal, Matt Bruckner, Kathleen Engel and Cre Johnson are putting together proposals for a symposium on AI, Consumer Credit, and Discrimination. They are applying to multiple law reviews on a rolling basis. If you have a project that fits within the proposed topic and are interested in participating in the symposium, please send a short abstract to Nikita at nikita_aggarwal@hks.harvard.edu as soon as possible. Until a law review accepts the proposal, it is not possible to provide details on the symposium's structure or location. Furthermore, submitting a proposal does not represent an absolute commitment to participate. The organizers hope that, if the proposal is accepted, you will be interested in attending the symposium even if you do not submit an abstract.

CFP for Hybrid International Consumer Protection Law Conference

Here is the announcement:

University of Pretoria International Consumer Law Conference (UPICLC 2022)

Since the first UPICLC conference in 2014, the University of Pretoria Consumer Protection Law Cluster has attempted to propagate and address various consumer issues and trends on a national, regional and international scale. Through the years there have been consistent collaborative efforts and the dissemination of information, scholarly research, empirical studies and the professional input of the legal fraternity and regulatory authorities. This all in an attempt to address issues regarding the global consumer market, regulatory enforcement and redress challenges, consumer rights and policy, proportionality, sustainability and vulnerability.

As a global community we are faced with disruptive events such as pandemics, natural disasters, crashing economies and governments that are divided, yet another industrial revolution with its own challenges and of course war. Consumer protection had to broaden its horizon and grew significantly as a multidisciplinary field of law as a result.

What should consumer protection and consumer protection law in the 21st century look like? Are we moving towards a new Pangaea where we are looking at a supercontinent with consistent conforming consumer regulation, representative of the world's consumers and segments in the consumer market or are we heading towards a continental drift where nations and continents are drifting further apart in their approach to consumer protection and the regulation of the business-consumer dynamic?

We invite attendees and speakers to explore this conference theme further, and how it affects all the various aspects, policies, theories, areas and rights that is considered part of consumer protection.

Virtual Conference: Multilevel Marketing: The Consumer Protection Challenge 2022

Hosted by The College of New Jersey School of Business on June 10th / 11th 2022. From the conference website: "This virtual conference brings together expertise from regulators, prosecutors, former MLM distributors, social media consumer advocates, researchers, educators, and journalists to discuss ways to improve consumer protection and reduce consumer harm within the multi-level marketing (MLM) industry." More information here. (HT: Robin Boyle)

Watch Tower Drops Its Effort to Identify a Dissident Blogger Based on Spurious Copyright Claims

by Paul Alan Levy

The effort by the Watch Tower Bible and Tract Society (a/k/a Jehovah’s Witnesses) to identify a dissident member, "Kevin McFree," through a spurious claim of copyright infringement has ended with a whimper rather than a bang as Watch Tower agreed to dismiss its copyright lawsuit with prejudice to avoid a possible claim for attorney fees. But the facts revealed by its conduct of the case, and its failure to pursue other cases, casts even further doubt on the bona fides of its extensive use of DMCA subpoenas to identify critics who uses its print and video works as the subjects of discussion

I wrote about this case after we first told the Court why Watch Tower could not prevail on an infringement action, or on a motion for leave to identify our client for the purpose of pursuing an infringement action, because it had already lost its DMCA section 512(h) subpoena action based on a holding of fair use, and it had allowed that ruling to become final by not pursuing an appeal. In that article, I noted that Watch Tower had filed more than seventy DMCA subpoenas, obtaining enforcement by default, but had never once filed an infringement action against a Doe thus identified. In fact, the only DMCA subpoena target it ever sued was the one target whom it had FAILED to identify – because the DMCA subpoena to identify McFree had been quashed. This casts doubt on the assertion that Watch Tower has to make to get DMCA subpoenas issued: that it will use the information only for the purpose of enforcing its rights under copyright law.

But matters continued to get worse for Watch Tower, and both its inability to be straightforward in explaining its actions, including making misleading statements to the court. and the likely ulterior motives for its actions, became increasingly clear.

Whither Arbitration Regulation?

by Jeff Sovern

Every six months, the CFPB director testifies before the Senate Banking Committee and the House Financial Services Committee. Each committee member gets five minutes to question the director, a process that collectively takes hours and this last time covered a wide variety of topics, including topics over which the CFPB lacks power, like non-payment aspects of digital currency. But somehow, no one asked Director Rohit Chopra during the most recent hearings (here and here) about what plans, if any, he has for arbitration regulation, something that the Bureau actually has jurisdiction over. I guess we will have to wait until the Bureau publishes its next regulatory agenda to see if arbitration is on its mind.