FTC's in‑house process struck down
A federal appeals court ruled the FTC’s in‑house adjudication process for deceptive‑advertising claims unconstitutional, meaning future cases must go before an Article III judge. That shifts the enforcement landscape and raises the stakes — advisors and marketing teams should recheck public claims and testimonials. (datamatters.sidley.com)
Intuit, Inc. v. Federal Trade Commission, No. 24‑60040, was decided by a unanimous Fifth Circuit panel (Judges Jones, Barksdale, and Ho) on March 20, 2026. (caselaw.findlaw.com) The panel vacated the FTC’s January 22, 2024 Opinion and Final Order that had barred Intuit from advertising TurboTax as “free” unless it was free for all or disclosed who qualified, and the vacated order included a 20‑year cease‑and‑desist restriction. (ftc.gov) (creditandcollectionnews.com) The court applied the Supreme Court’s SEC v. Jarkesy precedent (603 U.S. 109 (2024)) and held that Section 5 deceptive‑advertising claims implicate private‑rights principles, narrowing the reach of the public‑rights exception in two key respects identified by the opinion. (datamatters.sidley.com) (caselaw.findlaw.com) The opinion states Article III adjudication is required even where a claim is analogous to a traditional legal or equitable claim and even when the relief sought is primarily injunctive rather than monetary. (datamatters.sidley.com) The panel described that deceptive‑advertising enforcement under Section 5 will now typically need to proceed in Article III district courts, with jury trials available where civil penalties or legal remedies are asserted, a shift commentators say will raise costs and public visibility for future FTC cases. (creditandcollectionnews.com) (reuters.com) Amicus participation in the appeal was broad, including the U.S. Chamber of Commerce, National Federation of Independent Business Small Business Legal Center, the Cato Institute, Public Citizen and a coalition of state solicitors general joining on both sides of the briefs. (caselaw.findlaw.com) The panel expressly limited its holding to Section 5 deceptive‑advertising adjudications and left intact other FTC authorities for enforcement outside the ALJ context, while noting the decision provides a roadmap for litigants to challenge agency in‑house adjudication more broadly under Jarkesy. (datamatters.sidley.com)
