What Comes Next at the FTC, After Removal of Two Commissioners
On March 18, President Trump removed the two Democratic Commissioners at the Federal Trade Commission (FTC), a move that sets up litigation as the Commissioners appear likely to challenge their removal. Pending any litigation, the current FTC is a 2-0 Republican majority consisting of Chairman Andrew Ferguson and Melissa Holyoak, who now have the opportunity to act on several initiatives. Below we discuss changes and activity that may be on the horizon.
President Trump removed two Commissioners and broke the existing 2-2 split at the FTC. The two Democratic Commissioners, Rebecca Slaughter and Alvaro Bedoya, have stated that they will challenge the removals in court. The FTC is set up as an independent agency by statute, with Commissioners appointed to staggered seven-year terms, no more than three Commissioners from the same party, and Commissioners subject to removal only for “inefficiency, neglect of duty, or malfeasance in office.” (This is all set out in the FTC Act, 15 U.S.C. 41.) This “for cause” removal requirement was upheld by the Supreme Court 90 years ago in Humphrey's Executor v. United States, 295 U.S 602 (1935). The Administration argues that the reasoning behind that case is outdated and that the President has the authority to remove Commissioners at will.
While any court challenge proceeds, the Commission can seek to act on a 2-0 basis. Additionally, President Trump’s nominee to fill the empty third Republican seat, Mark Meador, has had a confirmation hearing and is advancing in the Senate.
Pending litigation, the 2-0 Commission can take action on its priorities.
Chairman Ferguson was originally confirmed as a Commissioner last year, and has been active since being named Chairman shortly after President Trump’s Inauguration. Here are some areas to watch in the near term:
(De)regulatory agenda. In his public remarks, Chairman Ferguson has emphasized that the FTC should not primarily be a regulatory agency, and both the Chairman and Commissioner Holyoak were critical of many FTC rulemakings in the previous Administration. With a majority, they might seek to roll some of them back. One potential target is the non-compete rule, which they both opposed and is currently enjoined from enforcement.
Potential action on other rules is less clear. For example, during the previous Administration the FTC passed the “click-to-cancel” rule with both Chairman Ferguson and Commissioner Holyoak dissenting, but the overall rule became effective in January 2025. Certain key provisions are not effective until May 14, 2025, which provides a limited window of time for the Commission to try to make any changes. In a signal that the Commission may retain the rule, on March 14, 2025 the Commission filed a brief opposing a challenge to the rule’s validity. Additionally, in January, the FTC passed amendments to the COPPA Rule on a bipartisan 5-0 basis, but Chairman Ferguson wrote separately that he favored a number of changes. The revised Rule has not yet been published in the Federal Register, which leaves open the possibility of additional changes before it becomes effective.
The FTC also enforces a wide range of other rules, many of which could be revisited. The President has issued an Executive Order calling for elimination of many regulations across the government, and the Federal Communications Commission, as one example, has opened a “Delete Delete Delete” docket, seeking public input on rules that might be rolled back. The FTC could potentially pursue a similar approach, or it could consider revisions to existing rules on a case-by-case basis through its public petition process.
New investigations, enforcement actions, and industry studies. Under Chairman Ferguson, the FTC will be launching new actions reflecting the Administration’s priorities. Some areas to watch include the following:
- Tech content moderation. The Chairman signaled potential investigations involving tech platform content moderation when announcing a request for information (RFI) on “technology platform censorship” last month. It is not clear whether any existing FTC “resolutions of authority” would allow the FTC to issue investigative demands to cover the matters raised in the RFI, but a new majority can vote to authorize one. A new majority could also vote to authorize an industry study, which can lead to a public report even if no enforcement action is taken.
- DEI. The Chairman has strongly criticized Diversity, Equity, and Inclusion (DEI) initiatives, in alignment with the general Administration approach to DEI. In a recent memorandum announcing a labor markets task force, he indicated that the FTC might investigate “collusion or unlawful coordination on DEI metrics.” The Chairman has emphasized that the FTC will use its consumer protection and competition authorities to protect workers, which may suggest scrutiny of DEI-related activities in the workplace through either investigative demands or industry studies
- Gender-affirming care. At the time then-Commissioner Ferguson was seeking to become Chairman, a supporting memorandum stated that the FTC would investigate “doctors, therapists, hospitals, and others” that provide “puberty blockers, hormone replacement” and other treatments for transgender individuals. The FTC has not announced any such investigations, though such investigations are generally non-public.
- Privacy. The Chairman and Commissioner Holyoak have been critical of novel consumer protection theories, like holding a generative AI firm liable for its customers’ illegal use of the software. But they have generally supported cases involving privacy based on a deception theory. They also have supported cases involving the sharing of sensitive data (like location data) without consent, and may support certain kinds of health-related privacy and security claims.
- Fraud. Chairman Ferguson has emphasized that the FTC will be bringing fraud cases, and indeed, the FTC has announced a number of bipartisan consumer protection cases in the new Administration. One area in which the FTC may be more active is financial services, depending on how new leadership at the Consumer Financial Protection Bureau (CFPB) proceeds.
The current FTC leadership has generally signaled that the agency intends to be active. As an additional example, the Director of the Bureau of Consumer Protection recently released a post explaining the civil investigative demand (CID) process for CID recipients, and emphasizing the importance of responding.
Overall, as the removal of Democratic Commissioners moves to potential litigation, the new FTC majority is likely to be active either publicly or behind the scenes.
Wiley’s FTC Regulation Practice counsels clients on FTC compliance, investigations, enforcement, and rulemaking, and regularly advocates before the agency. Contact the authors for additional information.
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