Lina Khan Can't

Federal Trade Commission Chairwoman Lina Khan 

has had loads of fun, pushing around businesses since

being installed in her current government position. 

However, she may have recently met her match.   

Walmart answered a punch Khan fired at them with

a punch of their own by challenging an abusive

lawsuit via challenging the agency's enforcement power.

Federal agencies, with their legions of bureaucrats, 

make rules and regulations that have the force of 

laws, and backed by the law itself. Walmart is battling 

back at the action taken against the retailer and the notion  

that an agency can do this with impunity. 

The FTC lawsuit claims Walmart aided and abetted 

con artists who took advantage of their customers, but

said suit has skimpy evidence. The FTC doesn't show that

Walmart had done anything wrong; rather, it argues that 

the company turned a "blind eye" by processing money 

transfers requested by customers who had been swindled.

This despite the fact that Walmart ran various anti-fraud 

programs including requiring customers to show government-

issued photo identification and warning them about scams.

However, the FTC complains that Walmart should have 

done more to stop the less than estimated 0.08% (!) of 

payments which customers unknowingly sent to the 

confidence tricksters via Walmart's money-transfer 

services. Furthermore, the FTC also argues that Walmart's

mere awareness that some of their customers might be

cheated (!!) makes the retailer liable for damages.

That's tantamount to a tire store selling sets of tires to 

their customers while being at all aware that any and all

of the tires may go flat by developing a leak or getting

punctured, then holding the tire store liable for any 

damages.

Walmart makes a powerful case that Congress "exceeded 

the limit on the powers that may be constitutionally vested"

in the FTC when it granted the bureaucratic agency the

authority to sue businesses in federal court. The basis of 

their case is the Supreme Court's Humphrey's Executor

(1935) precedent. In that case, the Court upheld restrictions 

on the President's removal authority of FTC commissioners

on the grounds that the FTC was an "administrative body" 

that exercises only "quasi-legislative or quasi-judicial powers"

such as conducting administrative adjudications as well as 

making investigations and reports to Congress. However,

in the 1970s Congress gave the FTC fundamentally executive 

powers by allowing it to seek injunctions and monetary relief

in federal court. Walmart stated that this act is invalid under 

Humphrey's Executor. Walmart held that if the President can't

fire commissioners at will, then they can't wield executive power.

Walmart is seeking merely to reaffirm Humphrey's limitations 

in their case which illustrates how agencies that are supposed 

to be independent have become constitution-flouting bullies

without accountability regarding how they use their power.

FTC Chair Lina Khan, take note. The FTC is not a branch of 

the federal government, and you, madam, are not a queen, 

even though you like to act like one.

MEM