U.S. Supreme Court to decide whether federal courts have jurisdiction over challenges to the structure of the Federal Trade Commission

The U.S. Supreme Court agreed to hear Axon Enterprise, Inc. v. Federal Trade Commission in an order released on Jan. 24, 2022. The case concerns whether federal courts have the authority to review constitutional challenges to the structure of the Federal Trade Commission (FTC) if plaintiffs have not first raised such challenges during agency adjudication proceedings. If the U.S. Supreme Court rules in favor of Axon, then people may challenge administrative agencies in federal court without first going through administrative proceedings.

The dispute that led to this case began when Axon Enterprise, Inc., a police body camera company, acquired a competitor in 2018 and the FTC opened an antitrust investigation. The FTC ordered Axon to undo the acquisition and to give the competitor company Axon’s intellectual property. 

Axon sued, arguing that the FTC violated the company’s due process rights, that the FTC’s structure violates Article II of the U.S. Constitution by providing improper insulation from the president, and that Axon’s acquisition did not violate antitrust law.

A district court and the United States Court of Appeals for the Ninth Circuit both ruled that when Congress created the FTC’s administrative review procedures it implied that district courts did not have authority to review constitutional challenges to the agency before the agency considered those challenges through adjudication.

The U.S. Supreme Court is set to schedule oral argument in the case during its October 2022-2023 term

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