FTC Employs SAFE WEB Act to Assist Canada’s Competition Bureau

By on August 8, 2014

On July 30, 2014, the U.S. District Court for the District of Maryland denied Aegis Mobile LLC’s motion to quash a Federal Trade Commission (FTC) subpoena seeking information related to an investigation by the Competition Bureau of Canada (Competition Bureau).  Aegis, based in Columbia, Maryland, contracted with the Canadian Wireless Telecommunications Association (CWTA) to collect and analyze the advertising used to promote the CWTA’s digital content.  The Competition Bureau, alleging the advertising was false and misleading, asked the FTC to seek information from Aegis Mobile about its work for the CWTA.  The FTC issued a subpoena for documents relating to the project using its power under the SAFE WEB Act.

The SAFE WEB Act enhances the FTC’s investigative and enforcement functions in information sharing, investigative assistance, cross-border jurisdictional authority and enforcement relationships.  The FTC advocated the reauthorization of the Act by Congress in 2012, pointing to over 100 investigations with international components that the FTC had already performed.  The FTC also pointed to figures suggesting cross-border fraud problems, including over 100,000 U.S. consumer complaints against foreign business in 2011.

One of the provisions of the SAFE WEB Act, 15 U.S.C. § 46(j), gives the FTC the authority to assist foreign authorities in investigating fraudulent and deceptive commercial practices, with certain exceptions.  The FTC employed the SAFE WEB Act here, and in response Aegis Mobile, sought to quash the FTC’s subpoena on the grounds that Aegis Mobile was a “common carrier,” and would therefore be exempted from the subpoena.  The court held that Aegis Mobile was not a common carrier and was subject to the FTC’s investigation.

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