Federal Trade Commission v. Johnson
800 F.3d 448
| 8th Cir. | 2015Background
- The FTC sued BF Labs, Inc. (BFL) alleging deceptive and unfair marketing and sale of Bitcoin mining machines and sought injunctive relief, rescission, restitution, and related remedies under the FTC Act.
- The district court entered a temporary restraining order, placed BFL in receivership, and stayed other suits; the receivership has since been wound down and the stay lifted.
- Prior to the FTC suit resolution, two consumers (Alexander and Symington) brought a class action against BFL alleging deceptive and unconscionable practices and later moved to intervene in the FTC action on behalf of their putative class.
- The consumers sought to intervene permissively and as of right; the district court denied intervention on the merits.
- The consumers appealed the denial of intervention of right; this Court reviewed standing de novo and affirmed the district court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to intervene under Article III | Consumers argued FTC victory could extinguish class members’ contractual possession and damages remedies, creating imminent injury | FTC and BFL argued injury is speculative because it depends on multiple contingencies (FTC victory, relief that forecloses class recovery, class certification, class success) | No standing: alleged injury was conjectural/hypothetical and not actual or imminent |
| Intervention of right under Rule 24(a) (adequacy of representation) | Consumers asserted their class interests required direct representation and could differ from the FTC’s enforcement objectives | FTC, as a government enforcement agency, represents the public interest in preventing deceptive practices; there is a presumption of adequate representation by the government | Denied intervention: consumers failed to overcome the strong presumption that the FTC adequately represents the public/consumer interest |
Key Cases Cited
- United States v. Metro. St. Louis Sewer Dist., 569 F.3d 829 (8th Cir. 2009) (standing to intervene requires injury in fact that is concrete, particularized, and actual or imminent)
- Nat’l Parks Conservation Ass’n v. EPA, 759 F.3d 969 (8th Cir. 2014) (standing requires injury, causation, and redressability)
- City of Los Angeles v. Lyons, 461 U.S. 95 (U.S. 1983) (abstract or speculative injuries do not satisfy Article III)
- United States v. White Plume, 447 F.3d 1067 (8th Cir. 2006) (distinguishing standing to intervene from standing to assert constitutional claims)
- N. Dakota ex rel. Stenehjem v. United States, 787 F.3d 918 (8th Cir. 2015) (Rule 24(a) intervention requirements)
- Chiglo v. City of Preston, 104 F.3d 185 (8th Cir. 1997) (presumption of adequate representation when an existing party represents intervenor’s interests)
- Little Rock Sch. Dist. v. N. Little Rock Sch. Dist., 378 F.3d 774 (8th Cir. 2004) (strong showing required to overcome presumption of adequate representation by a government entity)
- Jenkins ex rel. Jenkins v. State of Mo., 78 F.3d 1270 (8th Cir. 1996) (difference in litigation strategy does not rebut presumption of adequate representation)
- Morrison v. Back Yard Burgers, Inc., 91 F.3d 1184 (8th Cir. 1996) (no private cause of action under the FTC Act)
