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Understanding the FTC’s Civil Investigative Demand Enforcement Process and Remedies
What is a CID?
- A CID is a type of subpoena, which is a legally enforceable demand for documents, testimony, or other information related to an FTC investigation into potential violations of laws and regulations like consumer protection, privacy, or antitrust 1 5.
FTC’s Authority and Process for Issuing CIDs
- The FTC has broad authority under Sections 6, 9, and 20 of the FTC Act to issue subpoenas and CIDs to aid investigations 5.
- There is no evidentiary threshold for the FTC to issue a CID 23.
- In November 2022, the FTC also authorized its staff to more easily issue CIDs related to AI products and services, streamlining investigations in this area 24.
Responding to and Complying with CIDs
- Recipients are legally required to comply fully and in a timely manner with CIDs 569
. This includes scheduling a “meet and confer” with FTC staff soon after receipt 1. - Strategies like filing motions to quash or limit the CID are options, but courts tend to favor the FTC’s authority 6 17.
Noncompliance risks contempt charges and penalties 5 9.
- Continued failure to comply may prompt FTC litigation to compel responses, which has succeeded in 11 recent cases 9.
Potential Outcomes of FTC Investigations
- Providing complete responses may lead the FTC to close an investigation with no further action 1 23.
- However, the FTC may also negotiate a settlement or file a lawsuit if violations are found 1 23.
- Settlements often involve 20-year consent decrees with business practice restrictions, compliance programs, and penalties 10.