SCOTUS Decision Sets Up Constitutional Challenges To FTC Administrative Proceedings

Key Points

• In a unanimous decision, the Supreme Court held in Axon v. FTC that the FTC Act (and the SEC Act) do not prohibit a federal court from hearing challenges to the constitutionality of either Commission's structure and processes without first going through its administrative process. Despite a famously divided Court on many issues, this is the second unanimous Supreme Court ruling against the FTC in the last couple years (in 2021 the Court limited the FTC's ability to seek monetary remedies such as restitution or disgorgement).
• The decision is likely to touch off a wave of constitutional challenges to FTC (and SEC) authority to adjudicate matters through the administrative process. Although the Supreme Court declined to resolve those constitutional challenges at this time—it instead remanded the cases for further consideration in the lower courts—it found that federal courts can hear constitutional challenges to an agency's administrative process,