[author: Michael Buckalew]The following document provides a monthly roundupsummarizing enforcement actions, guidance, rulemakings, and other public statements from the Consumer Financial Protection Bureau and the Federal Trade Commission regarding the prohibition on unfair, deceptive, or abusive acts or practices (UDAAP) in the marketplace for consumer financial services.Enforcement and LitigationFederal Trade Commission & Utah. Fraud & Endorsements. The FTC and Utah Division of Consumer Protection publicized an agreement with the principals of a Utah-based real estate investment training company to resolve allegations that defendants used false promises to sell consumers a series of expensive real estate investment training programs. According to the complaint, defendants enlisted real estate television celebrities to endorse the programs. The agencies asserted the companies and individuals violated 15 U.S.C. § 45, 16 C.F.R. Part 310, and the Utah Consumer Sales Practices Act, Utah Code § 13-11-1 et seq., the Business Opportunity Disclosure Act, Utah Code § 13-15-1 et seq., and the Telephone Fraud Prevention Act, in the marketing and sale of real estate training services. Under the agreement, defendants will pay $15 million and be banned from selling moneymaking opportunities. (UDAAP Enforcement Focus: Deceptive).Federal Trade Commission. Student Loans. The FTC took action to stop a pair of alleged student loan debt relief schemes (#1 and #2) that it says bilked students out of approximately $12 million by using deceptive claims about repayment programs and loan forgiveness that did not exist. The company claimed to be or be affiliated with the Department of Education and that payments to the companies would be counted towards reducing their loan balances. In both cases, the defendants are accused of violating 15 U.S.C. § 45(a), 16 C.F.R. Part 310, 15 U.S.C. § 6821. In one of the cases, defendants

In the past, federal courts have approved such negotiated consent decrees with little or no comment, attaching extreme deference to the consent decrees and signing them as a matter of course. Judge Sullivan has now stated, however, that the 2004 amendments to the Tunney Act (15 U.S.C.A. § 16 (2006)), passed in response to District of Columbia Circuit’s highly deferential review and approval of the consent decree in United States v. Microsoft, require that he give both mergers — which have already closed — a more in-depth review. The 2004 Amendments to the Tunney Act directed that "before entering any consent judgment proposed by the United States under this section, the court shall determine that the entry of such judgment is in the public interest," and then instructed the court to consider the impact of the entry of judgment "upon competition and upon the public generally."

on, limited access, and written procedures for sharing the information. When the 2021 provisions were first proposed, the FTC acknowledged that they relied heavily on the cybersecurity regulations issued by New York’s Division of Financial Services (NYDFS). On the same day, the FTC published the 2021 regulations, it also announced its intent to further amend the Safeguards Rule with a mandatory reporting provision and brings us to the October amendment.Requirements of the amended Safeguards RuleWhen the FTC defined a notification event, it hoped to avoid arbitrary line-drawing questions regarding the sensitivity of the exposed customer information. The amended Safeguard Rule uses the existing regulation’s definitions of customer information and non-public personal information. The FTC defines non-public personal information as personally identifiable financial information and excludes information that is publicly available or not “personally identifiable.” See 15 U.S.C. § 6809(4), and 16 C.F.R. § 314.2.The FTC believes that security incidents should “trigger the notification requirement where customers’ non-public personally identifiable, unencrypted financial information has been acquired without authorization are serious and support the need for Commission notification.”FTC notifications provision will be encoded at 16 C.F.R. § 314(j), and will require a covered entity to include the following details through a form available on the FTC’s website https://www.ftc.gov:the name and contact information of the reporting financial institutiona description of the types of information exposed in the notification eventif the information is [available to identify], the date or date range of the notification eventthe number of consumers affected, anda general description of the notification event.This notification must be made within 30 days of discovery of the notification event, where ‘discovery’ is the first day the event is known to the non-banking financial institution. S

the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the accuracy of the assumptions and methodology used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of these information collections on respondents. The comment process is vitally important and is the main way the public can seek to have input into the outcome.If adopted, these proposed changes will have a dramatic impact on merger filings in the United States. An already robust, time consuming and expensive process will become exponentially more challenging.https://www.ftc.gov/legal-library/browse/federal-register-notices/16-cfr-parts-801-803-premerger-notification-reporting-waiting-period-requirements. See 15 U.S.C. § 18a and 16 C.F.R. §§ 801-803.https://www.whitehouse.gov/briefing-room/presidential-actions/2021/07/09/executive-order-on-promoting-competition-in-the-american-economy/. Each year, the FTC and USDOJ prepare an Annual Report to Congress summarizing HSR statistics. The most recent annual report covers FY 2021 (October 1, 2020-September 30, 2021). In FY 2020, 1,637 transactions were notified. That number jumped to 3,520 transactions in FY 2021. See Federal Trade Commission and Department of Justice’s 44th Hart-Scott-Rodino Annual Report (FY 2021) at 2. The Annual Reports are available at https://www.ftc.gov/policy/reports/annual-competition-reports. While FY 2022 figures are not yet available, the FTC estimates that over 3,200 transactions were notified in FY 2022. See PNRM at 24, fn. 22. Early termination refers to the agencies’ discretionary practice of allowing the waiting period to expire in less than the full statutory waiting period.https://www.ftc.gov/news-events/news/press-releases/2021/02/f

polization” (Oct. 31, 2022), https://www.justice.gov/opa/pr/executive-pleads-guilty-criminal-attempted-monopolization.[3]Remarks of Assistant Att’y Gen. Jonathan Kanter at 2022 Spring Enforcers Summit (April 4, 2022), supra.More recently, former Deputy Assistant Attorney General Richard Powers reiterated the DOJ’s position. Remarks of Deputy Assistant Att’y Gen. Richard Powers at University of Southern California Global Competition Thought Leadership Conference (June 3, 2022), https://www.justice.gov/opa/speech/deputy-assistant-attorney-general-richard-powers-delivers-keynote-university-southern (declaring that the Antitrust Division “will no longer ignore Section 2”).[4]Joseph Matelis and Daniel Richardson, Criminal Enforcement of Section 2 of the Sherman Act, 36 Antitrust 61, 61 (2022). Criminal conduct under Sections 1 and 2 of the Sherman Act became a felony in 1974. Antitrust Procedures and Penalties Act, Pub. L. No. 93-528, § 3, 88 Stat. 1706, 1708 (1974) (codified as amended at 15 U.S.C. § 16 (2012)).[5] United States v. Braniff Airways, Inc., 453 F. Supp. 724 (W.D. Tex. 1978) (denying the defendant’s motion to dismiss).[6] United States v. Molasky, 5 Trade Reg. Rep. 45,073 (case no. 2345) (D. La., filed 1973) (summary of indictment).[7] Information at 3, United States v. Zito, No. 1:22-cr-00113-SPW (D. Mont. Sept. 19, 2022).[8]Id. at 4-5.[9]Id.[10] Id.[11]Id.[12] Id.[13] Id.[14] 18 U.S.C. § 1343; see United States v. Ames Sintering Co., 927 F.2d 232 (6th Cir. 1990) (defendants charged with wire fraud for attempted bid rigging).[15] A wire fraud charge under 18 U.S.C. § 1343 would carry a maximum sentence of 20 years’ imprisonment and a fine of $250,000, while the maximum sentence for an individual charged with a criminal Section 2 violation is ten years’ imprisonment and a fine of $1 million. 15 U.S.C. § 2.[16]Remarks of Procurement Collusion Strike Force Director Daniel Glad at ABA Section of Public Contract Contract Law’s Public Procurement Symposium (Oct 13, 2021), htt

Merger Remedies Manual, supra, at 17 n.65 (alteration in original) (citation omitted). 15 U.S.C. § 16(b). Merger Remedies Manual, supra, at 18 (emphasis added).Id.

Concluding one of the longest merger reviews in history, on September 4, Judge Richard Leon, District Judge for the District of Columbia, issued his final ruling in United States v. CVS Health, approving the proposed settlement of the United States’ challenge to CVS’s merger with Aetna. The ruling concludes Judge Leon’s eleven month review of the proposed settlement, during which he repeatedly questioned whether the proposed settlement was “in the public interest” – the test for approval of the proposed settlement set forth under the Tunney Act (15 USC 16(e)(1)). To make that determination, Judge Leon conducted the first-ever live hearing in a Tunney Act proceeding, at which he heard testimony from those for and against the proposed settlement.

If, on the other hand, he rejects the proposed Final Judgment for failing to address concerns outside the scope of the Complaint, he will likely be overruled by the D.C. Circuit.___________________[1] The Antitrust Procedures and Penalties Act, 15 U.S.C. §§16(b)-(h).[2] U.S. v. Microsoft Corp., 56 F.3d 1448, 1462 (D.C. Cir. 1995).

[1] DOJ initiated the civil enforcement action by filing a complaint in federal court in Washington, DC against “two of the world’s largest rail equipment suppliers”, alleging that they had engaged in illegal “no-poach” agreements with each other and, later, with a third rail equipment supplier.[2] The companies have indicated their intent to stipulate to a civil consent judgment that remains subject to the approval of the court under the terms of the Antitrust Procedures and Penalties Act, 15 USC § 16(b)-(h). We previously commented on the antitrust issues and implications of the Antitrust HR Guidance both in the United States and internationally.

This judicial approval authority does not imbue courts with a new-found power to “scrutinize and countermand” prosecutorial authority and discretion. In support of its conclusion in Fokker, the court analogized judicial approval of DPAs to the limited judicial power under Rule 48(A) of the Federal Rules of Criminal Procedure, which requires a prosecutor to obtain “leave of court” before dismissing criminal charges, and to antitrust consent decrees under the Tunney Act, 15 U.S.C. § 16(e), which are to be approved by courts when “in the public interest.” These analogs confirmed the narrow confines of judicial authority in the charging context, reflecting that judicial oversight in these instances is intended to guard against possible prosecutorial harassment of the defendant (Rule 48(a)) and not as a predicate for judicial rejection of an agreement simply because the court disagrees with the Executive’s exercise of its prosecutorial discretion.