Opinion ID: 2718331
Heading Depth: 2
Heading Rank: 2

Heading: Liability Under the EFTA

Text: Although Kimoto does not contest that Vertek violated the EFTA, he argues that there is no individual liability for corporate violations of that Act. We disagree. The EFTA provides that “a violation of any requirement imposed under [the EFTA] shall be deemed a violation [of the FTC Act].” 15 U.S.C. § 1693o(c). The EFTA further provides that “[a]ll of the functions and powers of the Federal Trade Commission under the Federal Trade Commission Act are available to the Federal Trade Commission to enforce compliance by any person subject to the jurisdiction of the Federal Trade Commission with the requirements imposed under this subchapter.” Id. The EFTA provides no enforcement mechanism of its own, instead relying on the enforcement provisions in the authorizing statutes of the agencies tasked with enforcing the FTC Act. See 15 U.S.C. §§ 1693o(b)–(c). As previously discussed, where the FTC seeks a permanent injunction for violations of the FTC Act under 15 U.S.C. § 53(b) it can, under appropriate circumstances, hold an individual personally liable for corporate violations of the FTC Act. Affordable Media, 179 F.3d at 1234. In light of the above, we hold that individual liability for corporate malfeasance is available for violations of the EFTA because such violations are also deemed to be violations of the FTC Act, and that Kimoto is liable for Vertek’s violations of the EFTA because of his personal involvement in concocting and carrying out the several schemes that violated the EFTA, which are more fully discussed above. 20 FTC V. KIMOTO