UNITED STATES OF AMERICABEFORE FEDERAL TRADE COMMISSIONDOCKET NO. 9330In the Matter of GEMTRONICS, INC.,a corporation; andWILLIAM H. ISELY,individually and as the owner of Gemtronics, Inc.,Respondents.Brief of S.M. Oliva as

Amicus Curiae

Supporting Respondents' Appeal[PUBLIC]S.M. Oliva128 Old Fifth CircleCharlottesville, Virginia 22903(434) 253-1179

Amicus Curiae, pro se

June 2, 2010

TABLE OF CONTENTSTable of Authorities

Preliminary Statement

Argument

1. The ALJ applied the law incorrectly.

2. The Commision's position was not "substantiallyjustified."

Binding precedent requires the Commission to conductan adequate investigation before issuing a complaint.

b. The prior Decision of the Commission proves the pre-complaint investigation did not satisfy therequirements of

Hess

81. The Commission never called Isely or investigated any otherperson identified on the challenged website.92. The Commission never corroborated the information obtainedfrom the WHOIS search.103. The Commission's "undercover purchases" had nothing to dowith establishing Isely's control or responsibility for thechallenged website.12

3. Public policy — including the legislative history of theEAJA — supports granting Isely's application forattorney fees.

Congress enacted the EAJA to address thedisproportionate burden of government regulation onsmall businesses and individuals.

b. The Commission's recent history suggests a lack ofinstitutional control that emphasizes the necessity ofmeaningful EAJA relief.

Conclusion

Certificate of Service

TABLE OF AUTHORITIESCases

Hess Mechanical Corp. v. NLRB

, 112 F.3d 1076 (7th Cir. 2000) 6, 7,8, 14

Humphrey's Executor v. United States

, 295 U.S. 602 (1935) 14

In the Matter of M. Catherine Higgins

, No. 051-0252 (F.T.C. 2010) 20

In the Matter of Realcomp II Ltd.

, No. 9320 (F.T.C. 2009) 19

Morgan v. Perry

, 142 F.3d 670 (3rd Cir. 1998) 4, 5

Pierce v. Underwood

, 487 U.S. 552 (1988) 2, 3, 14

Rambus, Inc. v. FTC

, 522 F.3d 456 (D.C. Cir. 2008) 19

Schering-Plough Corp. v. FTC

, 402 F.3d 670 (11th Cir. 2005) 18, 19

Stein v. Sullivan

, 966 F.2d 317 (7th Cir. 1992) 4, 5

United States v. Hallmark Construction Co.

, 200 F.3d 1076 (7th Cir. 2000) 3, 4

Statutes & Regulations

Equal Access to Justice Act, 5 U.S.C. § 504

passim

5 U.S.C. § 504(a)(1) 1, 25 U.S.C. § 504(b)(1)(B) 2115 U.S.C. § 45(c) 616 C.F.R. § 3.24 2

Other Authorities

Equal Access to Justice Act

, 96th Cong., 1st sess., 1979, S. Rep. 253 15, 16, 17Senate Special Committee on Aging,

Prepared Statement of the Federal Trade Commission on Deceptive Marketing of Dietary Supplements – FTC Enforcement Activities

, 111th Cong., 2nd sess., 201017, 18S.M. Oliva, "Consumer Protection or Legal Extortion?" Mises Daily,July 10, 2008, http://mises.org/daily/303518S.M. Oliva, "FTC Illegally Published Elderly Couple's FinancialInformation," Mises Economics Blog, Dec. 10, 2009,http://blog.mises.org/1121620S.M. Oliva, "FTC Thinks Concealing Information Helps the Public," MisesEconomics Blog, April 1, 2010, http://blog.mises.org/1235021S.M. Oliva, "Realcomp Challenges FTC 'Right' to Dictate Website Content,"Mises Economics Blog, Dec. 1, 2009, http://blog.mises.org/1113019, 20