780 F.Supp.3d 17
D.D.C.2025Background
- The FTC entered a 2018 administrative consent order with 7-Eleven to resolve antitrust allegations concerning 7-Eleven’s $3.3 billion acquisition of convenience stores from Sunoco LP.
- The Consent Order required 7-Eleven to provide notice to the FTC before acquiring, including leasing, certain fuel outlets, with a 30-day waiting period after submission of additional information requested by the FTC.
- 7-Eleven allegedly violated the Consent Order by leasing a St. Petersburg, Florida outlet in December 2018 without providing the required notice to the FTC.
- 7-Eleven self-reported the violation in 2022, later sold the outlet, and the FTC sued for civil penalties and injunctive relief under Section 5(l) of the FTC Act after following statutory notice procedures with the Attorney General.
- In response to the lawsuit, 7-Eleven moved to dismiss, arguing only the Attorney General, not the FTC, could bring the civil penalty action in court under Section 5(l).
Issues
| Issue | Plaintiff's Argument (FTC) | Defendant's Argument (7-Eleven) | Held |
|---|---|---|---|
| Who can bring Section 5(l) civil penalty actions? | FTC can sue if AG declines after notice per Section 16(a); statutory structure authorizes FTC litigation in own name. | Only the Attorney General has authority; Section 5(l) vests exclusive enforcement in the AG, not the FTC. | FTC has authority if procedures met. |
| Interpretation of "on behalf of the Commission" | Actions to enforce Commission orders are, by nature, on behalf of the Commission, including via the AG or directly by FTC. | "On behalf of the Commission" is not equivalent to AG acting for U.S.; suit is by AG for U.S., excluding direct FTC action. | Enforcing Commission order is action on behalf of FTC. |
| Legislative changes in FTC Act (1973 v. 1975) | 1975 amendments consolidated FTC authority to bring suits after AG notice/waiting period; did not retract earlier FTC powers. | Removal of explicit language referencing Section 5(l) in 1975 indicates congressional intent to limit FTC direct action. | 1975 amendments did not revoke FTC authority. |
| Significance of agency/court practice | Rare exercise of direct FTC authority is irrelevant; grant of suit authority persists unless affirmatively revoked. | Lack of FTC contested cases shows understanding that AG is only authorized enforcer. | Dormancy does not negate the FTC’s statutory authority. |
Key Cases Cited
- United States v. Providence Journal Co., 485 U.S. 693 (Supreme Court clarified who may represent the United States in federal court)
- Hishon v. King & Spalding, 467 U.S. 69 (standard for accepting complaint’s factual allegations on a motion to dismiss)
- LabMD, Inc. v. FTC, 894 F.3d 1221 (11th Cir. 2018) (dicta recognizing FTC authority to sue for civil penalties under Section 16)
- Top Value Meats, Inc. v. FTC, 586 F.2d 1275 (8th Cir. 1978) (compliance with Section 16 notice provisions required for FTC to sue for penalties)