Beware FTC’s Expanded Focus On Private Equity, Individuals

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In the wake of recent Supreme Court precedent, the FTC has doubled down on and expanded its enforcement efforts, seeking financial and injunctive relief against not only companies that it believes act anti-competitively, but the individual executives who are at the helms. To that end, the FTC has built new enforcement avenues through novel interpretations of its existing authority. The article explores these newly-expanded enforcement avenues in various ways. It examines the dangers of successor liability and how those dangers will affect private equity purchases of entities under investigation. This includes the FTC’s new practice of requesting due diligence documents for transactions taking place during ongoing investigations—documents which can serve as a roadmap for the FTC and other agencies, demonstrating that new ownership was aware of the alleged misconduct and can be subject to liability. The article also addresses how executives and directors can be and have been held individually liable for corporate misconduct, employing case studies to illustrate the FTC’s recent pattern of pursuing individual executives.