*1 from ALJ Huard and the information perform- that he was not argues Smith to submit addi- gave opportunity Smith an activity pastor gainful ing substantial Thus, conclude we cannot tional evidence. only approximately he worked apply evidence or did not gain- ignored Substantial the ALJ per hours week. twenty Further, it is legal standards. activity proper activity is defined as “work ful try the issues de for this or men- not doing significant physical involves evidence, novo, re-weigh the or substitute profit. or C.F.R. pay tal activities” (b). ALJ. for that of the 404.1572(a), judgment sub- our own “Work (5th 131, 135 Carey Apfel, or the indi- part-time even if it is stantial Cir.2000). has failed Accordingly, Smith less than when vidual does less or earns Sullivan, evidence to demonstrate that substantial Britton v. working previously.” Cir.1990) support the ALJ’s conclusion (citing 20 does not 404.1572(a)). the law. wrongly applied the ALJ regulations The C.F.R. self-employment will be evalu- provide that the district court is The claimant’s] ated “based on the value [the regardless of services to the business an imme- whether [the claimant] receive[s] See 20
diate income for those services.” 404.1575(a)(2). regulations
C.F.R. in-
specifically provide that individual’s “alone because
come will not be considered actu-
the amount of income [the individual] may depend on a number of
ally receive[s] Id.
different factors.” The ALJ found that the evidence was COMMISSION, TRADE FEDERAL of hours conflicting as to the number Plaintiff-Appellant testimony he Smith worked. Smith’s week was only twenty per worked hours FINANCIAL FREEDOM PROCESS he made on an contradicted statements ING, INCORPORATED, corpora activity report, work in which he indi- SSA tion, formerly as Financial forty per he worked hours cated that America, Incorporated; found that Smith’s esti-
week. ALJ Butcher, Individually Corey low because he mation of his hours was Corporation; Brent Officer of the preparation time for activ- failed include Butcher, Individually and as an Offi ities such as Church services and Bible Corporation, Defendants- cer of the study. The that even if ALJ also found Appellees. forty than Smith’s duties amounted to less week, employment would per hours his Commission, Federal Trade ac- gainful still be considered substantial Plaintiff-Appellant tivity given the extensive nature of his responsibilities pastor as Church. America, Incorpo- Hertzig that ALJ Debt Consultants
Finally, argues Smith America, rated; Debt Professionals affidavits from witnesses ignored Creel, Individu- Incorporated; Robert assigned ALJ were submitted to first However, ally Corpora- case, an Officer of the as ALJ Huard. Butcher, tions; Corey Hertzig shows that ALJ did review record
489 Corporations; ads, deceptively radio on their claiming, as an Officer of the websites, calls, Creel, and in that sales the Com Nikki panies Corporations, could eliminate to 60% of con also of Officer sumers’ debt in Vrla, credit card as little as Defendants-Ap- as Nikki trial, to 36 months.1 At the defendants pellees. argued that the claims were ac perfectly No. 12-10520. interpreted by curate as a reasonable con Appeals, United States (1) sumer, who would have understood that Fifth Circuit. the advertised debt reduction excluded the (2) Companies’ fees and the advertised 12, 2013. Aug. excluded clients Esq., Singer, Attorney, John Andrew dropped To Daly, F. Trade Esq., John Federal Com- claims, support interpretation their mission, DC, Washington, Anne D. Le- heavily on defendants relied the Com Commission, Dallas, Federal jeune, Trade panies’ in sales calls and enroll TX, Plaintiff-Appellant. for agreements—disclosures made at Wise, Katherine Robert Kenneth Ruth shortly purchase. before the Hendler, P.L.L.C., Szygenda, Lillard Wise § agreed district court 5 deception Dallas, TX, Defendants-Appellees. all should be evaluated the basis of Companies
information the to disclosed up to the conclusion, Based on this it adopted the interpretation defendants’ of the claims and entered their favor. STEWART, Before § Chief The district is dubi HIGGINBOTHAM and Circuit Companies deployed ous. The a market Judges. ing campaign variety utilized a media and involved series of discrete HIGGINBOTHAM, E. PATRICK with consumers. communications Circuits * Judge: § to apply 5 in such circumstances have three debt-nego-
In the FTC sued concluded law is violated if the that “the companies—Financial tiation by first contact is deception, secured America, Inc., Debt of Amer- Consultants though the true facts made known Inc., ica, and Debt Professionals of Amer- buyer he enters into the con before (“the ica, Companies”)—as is, well as five Inc. purchase.”2 tract of That “each adver merits; the individuals who owned or controlled tisement on its must stand own FTC, the even if According them. defen- other advertisements contain accu claims, § a violation non-deceptive violated 5 of the FTC Act dants * Press, 47.5, Exposition to 5th the court has Inc. 295 F.2d Pursuant Cir. R. (2d Prods., opinion Cir.1961) (quoting determined that should not be Carter Inc. except published precedent 1951)); under Cir. limited set forth in 5th Cir circumstances Sys., Inc. also Resort Car Rental R. 47.5.4. 1975) ("[Section (9th Cir. is 5] here, through § prohibits As relevant "unfair or if the first violated it induces contact practices affecting in or acts or deception, buyer even if later becomes 45(a)(1). contract.”). The FTC commerce.” 15 U.S.C. entering fully informed before 13(b). brought suit under See U.S.C. 53(b). error.5 And while clear ads.”3 respect
occur with may be mislead with consid Hence, argument is an there 6—indeed, it is difficult to conclude ing district court erable *3 are deceptive7—we the websites are not content considering only not erred (the supports that substantial evidence satisfied of individual finding that reasonable district court’s consum contact” with Companies’ “first longer deceived at the were no only made consumers ers), also critical but bargaining arrived at consumers when court is district
table.4 however, clearly chal- did H. EDITH lenge the district concurring: oral during in briefs or ground this its colleagues’ rationale my I concur questioning. pointed argument—despite of fact are not findings the district court’s Rather, challenge the district it chose I am not so sure the clearly erroneous but reason- determination that court’s factual law, had FTC misapplied court district at the able I concur raised that issue. properly interpreted Companies’ have would judgment. timing claims in a non- debt-reduction attempt manner. The FTC’s deceptive assessment of consumer
characterize this is una- legal conclusion
perceptions only for findings review
vailing; we such excluded Corp. F.2d vertised Intern. 3. Removatron 1489, (1st Cir.1989); FTC v. been dropouts, see also have nonetheless 1496-97 the ads Network, Inc., F.Supp.2d Medical Billers they failed to disclose the 283, (S.D.N.Y.2008) ("[E]ach representa- (and affirmatively dropping likelihood merit, even if on its own tion must stand participation misimpression that fostered the accurate, non- representations contain other Stefanchik, painless). See FTC v. would Gill, information.”); FTC 924, (9th Cir.2009) (noting that (C.D.Cal.1999) (same). F.Supp.2d 5).§ may violate a material omission recognized pos- Though court the district persuaded us that the district 4. Had the FTC closing arguments, sibility during its concerns standard, legal applied we court an incorrect assuaged by die apparently the fact that were obliged to review the evi- would have been many risks of Companies disclosed the of the See, Co., Fuji e.g., Photo Film dence de novo. and enroll- participation in their sales calls Kaisha, Shoji Kabushiki Inc. v. Shinohara agreements. 1985). F.2d 591 Cir. See, Corp. e.g., Beneficial merely failed to dis- Whereas the radio ads (3d Cir.1976) ("Whether particular high dropout Companies’ close the advertising tendency or mis has a to deceive websites supra note two obviously impressionistic determi lead it, claiming affirmatively misrepresented finding fact closely akin to a nation more complete pro- majority clients "the of our Food, law.”); Giant than to a conclusion added.) (emphasis grams in 18-36 months.” (D.C.Cir. 982 n. 12 Inc. v. FTC 322 F.2d unambiguously language clearly This 1963) ("The meaning of advertisements majority conveys of consumers public, representations to the and their other (i.e., "clients”) programs success- enroll in the deceive, capacity tendency or to mislead or fully complete programs within 18 to 36 fact....”). questions of months; however, the evidence establishes accepting reason- example, even that a 6. For competed enrolled clients that at most 24% Companies’ ra- exposed to the able consumer that the ad- have understood dio ads would