FTC Consumer Protection Orders: The Case for a New Sunset Policy

FTC consent orders generally bind businesses for 20 years (in the case of administrative orders) or indefinitely (in the case of federal court orders). In a recently-published white paper, Kelley Drye attorneys John Villafranco and Andrea deLorimier make the case for shorter FTC consent orders.

The white paper, published by the Washington Legal Foundation, argues that FTC consent orders are too long because:

1. Consent order violations generally occur within the first few years after order entry;
2. Other federal agencies issue consent orders with much shorter durations;
3. The provisions contained in today’s consent orders are immensely burdensome for businesses;
4. Consent orders hamper innovation over the course of two decades; and
5. The FTC does not have a workable path for modification or termination of consent orders.

The white paper urges the FTC to adopt a different approach to order termination—one that better aligns with the agency’s historic goal of protecting consumers without unduly burdening legitimate business activity. It also describes the benefits of various, shorter order termination periods, including a 5-year period, 10-year period, and a period defined by the facts and circumstances of a particular matter.

The Washington Legal Foundation is a public-interest law firm and policy center that advocates for the rule of law. You can read the paper here.