The Third Circuit's recent decision in FTC v. Shire
ViroPharma, Inc.1 severely limits a significant
tool in the FTC's antitrust and consumer protection enforcement
toolbox by holding that the agency may not bring a federal court
action for injunctive and monetary relief unless the challenged
conduct is existing or impending. In practical terms, the decision
renders the FTC powerless in the Third Circuit2 to seek
restitution or disgorgement of profits for conduct that occurred
wholly in the past where the FTC lacks a specific basis to claim
that the defendant is "about to violate" the law
again.
Absent reversal by the Third Circuit en banc, or
Supreme Court review, the FTC cannot meet this threshold
requirement for a Section 13(b) action by pleading "likelihood
of recurrence"—the traditional equitable standard for
obtaining injunctive relief. Notwithstanding this development for
FTC enforcement, state and local governments (e.g., in California)
are expected to
