1 2 3 4 5 IN THE UNITED STATES DISTRICT COURT 6 FOR THE NORTHERN DISTRICT OF CALIFORNIA 7 8 FEDERAL TRADE COMMISSION, Case No. 22-cv-01973-CRB

9 Plaintiff,

ORDER DENYING MOTION FOR

10 v.

EMERGENCY RELIEF

11 INTUIT INC., 12 Defendant.

13 Plaintiff Federal Trade Commission (FTC) moves for a Temporary Restraining 14 Order and a Preliminary Injunction under Section 13(b) of the FTC Act, arguing that 15 Defendant Intuit Inc. is deceptively advertising TurboTax Free Edition in violation of 16 Section 5(a). See Emergency Mot. (dkt. 28); Compl. (dkt. 1). The FTC alleges that Intuit 17 advertises that TurboTax Free Edition is “free free free free” and includes only a small and 18 vague disclaimer that it is “for simple returns only” or to “see details at TurboTax.com.” 19 Taxpayers whose returns do not meet Intuit’s definition of “simple” eventually run into a 20 message on the TurboTax website informing them that they must pay to file. 21 Under Section 13(b) of the FTC Act, a district court may grant a preliminary 22 injunction “[u]pon a proper showing that, weighing the equities and considering the 23 Commission’s likelihood of ultimate success, such action would be in the public interest.” 24 15 U.S.C. § 53(b); see FTC v. Affordable Media, 179 F.3d 1228, 1233 (9th Cir. 1999). A 25 defendant engages in deceptive acts or practices under Section 5(a) of the FTC Act if it (1) 26 made a representation, omission, or practice, (2) which was likely to mislead consumers 27 acting reasonably under the circumstances, and (3) which was material. FTC v. 1 The Court denies the FTC’s motion for emergency relief for three reasons. First, 2 || Tax Day, which was April 18, 2022, has passed. Most taxpayers have already filed their 3 || taxes. Intuit represented in its briefing and at oral argument that its advertising is largely 4 || done for this tax season. See Opp. (dkt. 45) at vi. Any prospective harm is therefore 5 attenuated. Second, even before Tax Day, Intuit had removed several of the most 6 || plausibly deceptive advertisements—that is, three videos that repeated the word “free” a 7 || dozen or more times over 30 seconds before a very brief disclaimer. See Shiller decl. (dkt. 8 || 7-13, GX 301) 16-31 (describing these ads); Ryan decl. (dkt. 45-3) 4] 16-26 (noting 9 their removal). Third, to the extent other advertisements might violate the FTC Act, the 10 || Court notes that the FTC has brought an administrative proceeding against Intuit, with a 11 || hearing set for September 14, 2022. See 15 U.S.C. § 45(b); AMG Cap. Memt., LLC v. 12 || Fed. Trade Comm’n, 141 S. Ct. 1341, 1346 (2021) (detailing the administrative process). 13 || An Administrative Law Judge (ALJ) with expertise in these matters will hear (and likely 14 || rule) before Intuit resumes its advertising campaign in the lead-up to Tax Day 2023. 15 For the foregoing reasons, the Court DENIES the FTC’s Emergency Motion for a 16 || Temporary Restraining Order and a Preliminary Injunction.! However, if Intuit resumes 17 |} its full advertising campaign before the ALJ releases her § 45(b) report, or the facts on the 18 ||} ground change significantly, the FTC may return to this Court to request relief. 19 IT IS SO ORDERED. 20 Dated: April 22, 2022 a K “Yr

CHARLES R. BREYER

21 United States District Judge 22 23 24 25 26 27 28 wes, administrative motion for emergency relief on the briefs (dkt. 50) is DENIED AS