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Federal Trade Commission v. Amy Travel Service, Inc.

United States Court of Appeals for the Seventh Circuit
875 F.2d 564 (1989)


Facts

Amy Travel Service, Inc. (Amy Travel) (defendant) sold travel certificates for between $289 and $329. Amy Travel reached customers through telemarketing, using a confusing and evasive script to convince people to recite their credit card numbers over the phone. The travel certificates seemed to include a full vacation package for the certificate price, but purchasers were unexpectedly charged later for expensive airfare. In some cases, the true price charged by Amy Travel far exceeded the prices offered by conventional travel agencies. The Federal Trade Commission (FTC) (plaintiff) filed a suit in federal district court, seeking an injunction, rescission, asset freeze, and restitution to consumers. The FTC claimed that Amy Travel had violated § 5 of the Federal Trade Commission Act (FTC Act) by engaging in unfair and deceptive trade practices. The judge entered a judgment against Amy Travel and imposed the FTC’s requested relief. Amy Travel appealed, arguing that the court did not have the authority to issue monetary equitable relief in the form of rescission and restitution.

Rule of Law

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Issue

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Holding and Reasoning (Wood, J.)

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  • A "yes" or "no" answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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