Advertising Law Blog

As the world awaits the next term of Donald Trump, marketers and advertisers are contemplating the potential changes in consumer protection regulations. While certain aspects of federal regulation and enforcement may have been relaxed during Trump’s first term, the Federal Trade Commission’s (“FTC”) consumer protection enforcement mandate is expected to remain a significant priority, although the pathways may differ significantly from the Kahn Commission.

Continued Focus on Consumer Protection

During Trump’s first term, the FTC maintained its primary “Strategic Goal” of protecting consumers from unfair or deceptive acts or practices in the marketplace. Despite a GOP majority of Commissioners, this objective is unlikely to shift, though the methods used to achieve it may evolve.

Throughout his first administration, the FTC continued to enforce consumer protection against both large and small marketers. Key areas of focus included health claims, Made in USA claims, fintech, small business scams, payment processors, rent-to-own schemes, debt collection abuse, and debt settlement practices. The COVID-19 pandemic prompted a pivot in enforcement, with the agency aggressively targeting unsupported treatment and prevention claims through warning letters and enforcement actions.

Impact of Supreme Court Decisions

Recent Supreme Court rulings will likely influence the FTC’s future actions. The 2021 AMG Capital Management v. FTC decision significantly reduced the agency’s power to seek consumer redress by barring it from pursuing disgorgement under ancillary equitable relief. Additionally, the landmark Loper Bright Enterprises v. Raimondo decision issued earlier this year, struck down the Chevron doctrine, which for forty years had granted federal regulators considerable deference in enforcing regulations.   The Loper Bright ruling is expected to limit the FTC’s ability to interpret and enforce rules without explicit legislative support.

New FTC Leadership and Regulatory Approach

Commissioner Andrew Ferguson, the former solicitor general of Virginia, has been announced as the successor to current FTC Chair Lina Khan. While only a Commissioner since April 2024, his support for FTC’s consumer protection and privacy goals are well-documented, his approach to expansive regulation may differ.  Indeed, he is expected to advocate for Congressional approval of new regulatory standards, in contrast to Khan’s preference for FTC-led rulemaking.

A recent example of this shift in regulatory philosophy is in connection with the just announced Final Negative Option Rule. Both Commissioner Ferguson and Commissioner Holyoak voted against the final rule, in part because of a belief that its provisions sought to evade Congressional action. 

Future Expectations

While the exact path of the FTC’s consumer protection efforts remains uncertain, it is likely that the agency will continue to challenge unfair or deceptive advertising and marketing practices. Despite anticipated changes in rulemaking authority and leadership, the core mission of safeguarding consumers is expected to persist. For marketers and advertisers, it is essential to stay informed of these developments and ensure compliance with the evolving regulatory landscape.