Part 3: Return of Jarkesy

Friday’s Fifth Circuit decision vacating the FTC’s cease-and-desist order against Intuit marks the clearest extension yet of SEC v. Jarkesy beyond the securities context—and into the core of the FTC’s enforcement model. The court held that adjudicating deceptive advertising claims before an FTC ALJ (i.e., in “Part 3”) violates the Constitution, and such claims must instead be heard in Article III courts.

This is not an isolated development. As the Chamber argued earlier this month in support of a more disciplined approach to merger policy, the FTC’s enforcement tools must be grounded in statutory limits and institutional legitimacy—not stretched beyond them. The Fifth Circuit has now imposed that discipline from the outside.

Near-term: enforcement shifts forums

The immediate impact is practical. The FTC will need to bring even more cases in federal court, where procedures are more robust, standards of proof are higher, and judicial scrutiny is independent. That shift reduces reliance on in-house adjudication—long viewed as a faster, more controlled enforcement path—and will likely slow cases, increase costs, and recalibrate settlement dynamics. For businesses, this is a meaningful procedural reset.

Longer-term: Part 3 recedes, and the notion of FTC “independence” is dealt another blow.

This ruling lands as FTC leadership has already begun stepping back from Part 3 adjudication in merger cases, a position the Chamber previously endorsed as both prudent and necessary.

The Fifth Circuit’s decision accelerates that trend. What was becoming a policy choice will increasingly become a constitutional constraint. More than ever, the FTC is beginning to look less like a uniquely “independent” body and more like a conventional executive agency. This is by design: whether through judicial decisions, leadership choices, or broader political pressures, the Commission is steadily shedding the features that once set it apart.

Bottom line

The Fifth Circuit’s decision and the FTC’s own posture on Part 3 point in the same direction: a rebalancing toward traditional judicial processes. As Jarkesy continues to extend beyond the SEC, the FTC is likely to look increasingly like other executive agencies—both in its enforcement approach and in the conception of its role.

About the author

Ashley Gum