Is EPIC Out of Line with Suit Against FTC?

Lora Bentley

Last March when Google settled Federal Trade Commission privacy charges arising out of its short-lived Buzz social networking service, I thought the matter was closed. But I should know better than to assume I've heard the last of anything. (SCO, anyone?)


Forbes reported Wednesday a federal court is preparing to decide whether the FTC must act upon a complaint filed by privacy advocate Electronic Privacy Information Center. EPIC wants the FTC to fine Google for violating the terms of last year's settlement agreement. Specifically, EPIC says the soon-to-be-implemented changes to Google's online privacy controls violate the settlement agreement.


One small problem: EPIC was not a party to the settlement Google made with the FTC, and EPIC is not directly suing Google. In fact, EPIC admits it has no standing to seek injunctive relief under the Federal Trade Commission Act. The group instead bases its complaint on the Administrative Procedures Act, arguing that the FTC has a "non-discretionary duty to act" because Google's behavior violates the agreement.


However, as Forbes contributor Glenn G. Lammi points out, the U.S. Supreme Court has made clear that the agency has discretion when determining both whether particular actions violate an agreement, and if so, whether a fine should result. As such, the case should be thrown out. Lammi says:

[O]nce a settlement agreement has been reached between an agency and a private entity, the agency should not be compelled to embrace an outside party's view that the agreement has been breached. ...[E]mpowering activists or competitors to imprint their views of consent agreement breach on the Commission would be a dangerous and easily abused tool.

I can't disagree.

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