H&R Block (NYSE:HRB) is hitting back at the U.S. Federal Trade Commission’s lawsuit against the company and has sued the agency, challenging the FTC’s practice of using administrative law judges.
The lawsuit filed in Kansas City, Mo., uses the argument that administrative law judges working for the FTC are “improperly insulated” from a U.S. law that protects “inferior officers” with the executive branch.
According to the Legal Information Institute, administrative law judges, as opposed to administrative judges, are executive judges for official and unofficial hearings of administrative disputes within the Federal government. They are considered part of the executive branch and not the judicial branch of the U.S. government and are appointed by the head of the executive agencies.
The use of administrative law judges has been used as a legal argument in other cases. According to Reuters, the U.S. Supreme Court recently heard a challenge to the Securities and Exchange Commission’s use of administrative law judges.
H&R Block’s lawsuit aims to dismiss last month’s FTC action against the company. The agency sued H&R Block (HRB) for deceptively marketing their products as free when they were not free for many customers.
“H&R Block designed its online products to present an obstacle course of tedious challenges to consumers, pressuring them into overpaying for its products,” said FTC’s Bureau of Consumer Protection director Samuel Levine.