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    HomeBreakingANALYSIS: How One Lawsuit Could Dismantle The Administrative State

    ANALYSIS: How One Lawsuit Could Dismantle The Administrative State

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    Over the future of the administrative state, Walmart Inc. and the Federal Trade Commission (FTC) are engaged in a fatal conflict.

    Walmart is held accountable by the FTC for fraud perpetrated via its money transfer services, according to the agency.

    In response, Walmart asserted that the quantity of fraudulent purchases was “only a minuscule number” and that the business had actually “stopped hundreds of thousands of suspicious transactions totaling hundreds of millions of dollars.”

    However, the business is also making a point that could affect parties apart from those directly involved.

    Citing significant Supreme Court decisions from decades ago, Walmart is taking aim at the FTC directly, claiming that its exercise of executive power is both illegal and illegitimate.

    Eli Nachmany, a law clerk to Judge Steven J. Menashi of the U.S. Court of Appeals for the Second Circuit, argues at the Regulatory Review that “The retail giant’s creative litigation strategy has set up a constitutional showdown with the FTC that might have some practical consequences.”

    Walmart claims that “the FTC lacks constitutionally valid power to begin litigation seeking monetary or injunctive remedy” in its move to dismiss the complaint filed in August.

    The FTC is currently regarded as an independent regulatory body, which means the president cannot arbitrarily dismiss any of its commissioners from their positions.

    The commission can therefore take action without being constrained by the power of the president, who was chosen by and is answerable to the people.

    The president has no authority over the FTC and cannot dismiss any of its employees, save in extremely limited circumstances, such as “inefficiency, neglect of duty, or malfeasance.”

    In the 1935 case Humphrey’s Executory v. United States, the Supreme Court considered whether this strategy for upholding purported “independence” for administrative state branches was constitutional.

    In the case, President Herbert Hoover’s choice for FTC commissioner, William Humphrey, opposed the New Deal during the presidency of Franklin Delano Roosevelt.

    Humphrey was fired by FDR as a result of his disobedience, which the commissioner claimed was illegal.

    More on this story via The Daily Caller:

    The Supreme Court ruled in this case that the FTC is not a part of the executive branch and operating under the power of the president, but an independent agency which Congress could limit the president’s power over… CONTINUE READING…

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