Case 5:22-cv-04325-EJD Document 173 Filed 11/02/22 Page 1 of 15
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`SAN JOSE DIVISION
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`FEDERAL TRADE COMMISSION,
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`Plaintiff,
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`v.
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`META PLATFORMS INC., et al.,
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`Defendants.
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`Case No. 5:22-cv-04325-EJD
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`ORDER GRANTING IN PART
`MOTION TO STRIKE
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`Re: Dkt. No. 89
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`Plaintiff Federal Trade Commission’s (the “FTC”) moves to strike certain affirmative
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`defenses asserted by Defendants Meta Platforms, Inc. (“Meta”) and Within Unlimited, Inc.
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`(“Within,” collectively with Meta, “Defendants”). Dkt. No. 89 (“Mot.”). Having considered the
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`parties’ briefing and heard oral arguments, the Court GRANTS IN PART the FTC’s Motion.
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`I.
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`BACKGROUND AND PROCEDURAL HISTORY
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`On July 27, 2022, the FTC brought this action to enjoin Defendant Meta—one of the
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`largest technology companies in the world and provider of virtual reality (“VR”) devices and
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`applications—from consummating its proposed acquisition (“Acquisition”) of Defendant Within,
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`a software company that develops VR applications and most relevantly the VR fitness application,
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`“Supernatural.” Dkt. No. 1 ¶ 1. The FTC sought preliminary injunctive relief pursuant to Section
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`13(b) of the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. § 53(b), alleging that the
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`Acquisition poses a reasonable probability of lessening competition in violation of Section 7 of the
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`Clayton Act. Id. ¶ 13-14.
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`Both Defendants filed answers to the FTC’s Complaint on August 26, 2022, with Meta
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`asserting twenty-two affirmative defenses (Dkt. No. 84) and Within asserting twenty affirmative
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`defenses (Dkt. No. 83). On September 9, 2022, the FTC filed the instant motion to strike six of
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`Meta’s affirmative defenses and three of Within’s defenses. Mot. 2-3.
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`After the Motion was fully briefed, the parties stipulated to the FTC’s amendment of its
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`complaint, which removed certain allegations and theories asserted in the initial Complaint. Dkt.
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`No. 101, 101-1 (“FAC”). The parties further stipulated that Defendants’ answers and affirmative
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`defenses shall remain responsive to the FTC’s Amended Complaint, Dkt. No. 101, and represented
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`to the Court that the FTC’s amendments do not affect the issues raised in the pending Motion.
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`Hr’g Tr. 6:11-19, 7:21-23, Oct. 17, 2022.
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`II.
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`LEGAL STANDARD
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`Federal Rule of Civil Procedure 12(f) permits a court to “strike from a pleading an
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`insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed. R.
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`Civ. P. 12(f). The purpose of a motion to strike under Rule 12(f) “is to avoid the expenditure of
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`time and money that must arise from litigating spurious issues.” SidneyVinstein v. A.H. Robins
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`Co., 697 F.2d 880, 885 (9th Cir. 1983).
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`“A defense may be insufficient as a matter of pleading or a matter of law.” G & G Closed
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`Cir. Events, LLC v. Nguyen, 2010 WL 3749284, at *1 (N.D. Cal. Sept. 23, 2010). “The key to
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`determining the sufficiency of pleading an affirmative defense is whether it gives plaintiff fair
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`notice of the defense.” Wyshak v. City Nat. Bank, 607 F.2d 824, 827 (9th Cir. 1979). In this
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`district, defendants provide “fair notice” of an affirmative defense by meeting the Twombly/Iqbal
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`pleading standard. See, e.g., Goobich v. Excelligence Learning Corp., 2020 WL 1503685, at *2
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`(N.D. Cal. Mar. 30, 2020) (collecting cases). Accordingly, although an affirmative defense “need
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`not include extensive factual allegations . . . it must nonetheless include enough supporting
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`information to be plausible; bare statements reciting legal conclusions will not suffice.” MIC
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`Prop. & Cas. Corp. v. Kennolyn Camps, Inc., 2015 WL 4624119, at *2 (N.D. Cal. Aug. 3, 2015).
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`In addition to insufficiently pled defenses, Rule 12(f) permits courts to strike matters that
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`are immaterial or impertinent. Fed. R. Civ. P. 12(f). An immaterial matter is “that which has no
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`essential or important relationship to the claim for relief or the defenses being pleaded,” and an
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`Case 5:22-cv-04325-EJD Document 173 Filed 11/02/22 Page 3 of 15
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`impertinent matter “consists of statements that do not pertain, and are not necessary, to the issues
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`in question.” Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), rev’d on other
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`grounds, 510 U.S. 517 (1994) (quoting 5 Charles A. Wright & Arthur R. Miller, Federal Practice
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`and Procedure § 1382, at 706–07 (1990)).
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`“In the absence of prejudice to the opposing party, leave to amend [a stricken affirmative
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`defense] should be freely given.” Wyshak, 607 F.2d at 826.
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`III. DISCUSSION
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`In their briefs, the parties have generally addressed the challenged affirmative defenses in
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`four categories, as follows: (1) bias defenses; (2) constitutional defenses; (3) selective enforcement
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`defense; and (4) equitable defenses.1
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`A.
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`Bias Defenses
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`Meta asserts two affirmative defenses arising from Chair Khan’s alleged bias. Meta’s
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`Eighteenth Affirmative Defense states that the “FTC is not entitled to relief because the Chair of
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`the FTC is disqualified,” and that she has made “numerous public statements that demonstrate her
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`bias against Meta, and in particular its acquisitions, demonstrating her lack of impartiality with
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`respect to Meta’s proposed acquisition.” Meta Answer 16-17, Dkt. No. 84. Meta’s Nineteenth
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`Affirmative Defense asserts that the “FTC cannot proceed because it cannot demonstrate
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`likelihood of success on the merits or that the balance of equities favor an injunction, as Chair
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`Khan is disqualified.” Meta Answer 17.
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`The FTC moves to strike these bias-related defenses on two related grounds: first, the
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`Court does not have subject matter jurisdiction to consider Defendants’ challenges to the FTC’s
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`administrative proceeding; and second, as a result, the issue of Chair Khan’s bias is not relevant to
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`this Court’s consideration of a Section 13(b) request. Mot. 10-15. Defendants respond that (1) the
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`Court’s subject matter jurisdiction is provided by Section 13(b) of the FTC Act under which the
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`1 Within’s Seventeenth Affirmative Defense is identical to Meta’s Seventeenth Affirmative
`Defense; Within’s Eighteenth Affirmative Defense is analogous to Meta’s Twentieth Affirmative
`Defense; and Within’s Nineteenth Affirmative Defense is identical to Meta’s Twenty-First
`Affirmative Defense. See Meta Answer, Dkt. No. 84; Within Answer, Dkt. No. 83.
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`FTC has brought the present action, and (2) Chair Khan’s bias is relevant because “ultimate
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`success” under Section 13(b) contemplates appellate success before a Court of Appeals where
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`Defendants can raise bias and other due process defenses to the FTC’s proceedings. Opp. 11-15.
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`As an initial matter, the Court notes—and the FTC does not appear to dispute—that Meta’s
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`Eighteenth and Nineteenth Affirmative Defenses satisfy the requisite pleading standards. See,
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`e.g., MIC, 2015 WL 4624119, at *2 (“[A] defense need not include extensive factual allegations
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`[but] must nonetheless include enough supporting information to be plausible.”). Both defenses
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`go beyond mere recitation of legal doctrines and contain factual allegations substantiating
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`Defendants’ assertion that Chair Khan is biased and should be disqualified as a Commissioner.
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`Accordingly, the Court finds that these affirmative defenses have provided the FTC with fair
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`notice of the defenses and the factual bases underlying them.
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`1.
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`Subject Matter Jurisdiction
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`The FTC first asserts that district courts do not have subject matter jurisdiction to consider
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`a party’s challenges to the FTC’s structure or the underlying administrative proceedings, including
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`those based on the alleged bias of Chair Khan. Mot. 10-11. Such challenges, it argues, should be
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`heard by a Court of Appeals, not a district court, following an appeal from the final FTC order in
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`the administrative proceedings. Mot. 11-12; 15 U.S.C. § 45(c).
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`To support this position, the FTC relies primarily on the recent Ninth Circuit opinion in
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`Axon Enterprise, Inc. v. F.T.C., 986 F.3d 1173 (9th Cir. 2021), cert. granted in part, 142 S. Ct.
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`895 (2022). There, the FTC initiated an administrative complaint against Axon’s acquisition of a
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`competitor, and Axon filed suit in federal court seeking relief from the FTC’s allegedly
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`unconstitutional administrative proceedings. Id. at 1177. The Ninth Circuit affirmed the district
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`court’s dismissal of Axon’s complaint for lack of subject matter jurisdiction, holding that the FTC
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`Act impliedly barred jurisdiction in district court and required Axon to first proceed through the
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`agency process. Id. In so holding, the Ninth Circuit applied the Thunder Basin factors established
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`by the Supreme Court to determine whether district court jurisdiction was impliedly precluded.
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`Id. at 1180-88; Mot. 11-15. The FTC argues that this Court similarly does not have subject matter
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`jurisdiction to consider Defendants’ affirmative defenses raising the same type of claims that Axon
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`would have precluded. Mot. 14 (citing Jarkesy v. S.E.C., 803 F.3d 9 (D.C. Cir. 2015) (affirming
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`dismissal under the Thunder Basin factors where plaintiffs alleged the SEC was biased and had
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`prejudged their charges in the underlying agency proceedings)).
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`Although Axon is helpful in clarifying the Court’s jurisdiction to hear claims brought by
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`parties against an FTC administrative proceeding, the Court agrees with Defendants that Axon
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`does not bear upon subject matter jurisdiction in the present case. Neither party dispute this
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`Court’s subject matter jurisdiction over the FTC’s claim. See FAC ¶¶ 16-17 (citing 28 U.S.C. §
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`1337 (“The district courts shall have original jurisdiction of any civil action or proceeding arising
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`under any Act of Congress regulating commerce or protecting trade and commerce against
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`restraints and monopolies.”)). Defendants also have not asserted any counterclaims seeking relief
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`over which the Court may need to exercise jurisdiction, nor does the FTC argue that Meta’s
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`Eighteenth and Nineteenth Affirmative Defenses should be designated as counterclaims. See Fed.
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`R. Civ. P. 8(c)(2). Furthermore, unlike Axon where the precluded issues were raised offensively
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`by a plaintiff to block underlying administrative proceedings, here, the purportedly precluded
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`issues are raised defensively in response to a complaint filed by the FTC. Although the FTC
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`counters that these are formalistic distinctions without a difference, it also acknowledged in oral
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`arguments that no court has relied on the Thunder Basin analysis to strike an affirmative defense
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`for lack of subject matter jurisdiction, which the FTC urges the Court to do so here. Hr’g Tr.
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`17:11-20, Oct. 21, 2022, Dkt. No. 172.
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`Accordingly, the Court is satisfied that its subject matter jurisdiction is secure over the
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`FTC’s claim for Section 13(b) preliminary injunctive relief, as well as the affirmative defenses
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`raised by Defendants in their answers.
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`2.
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`Pertinence to Section 13(b) Preliminary Injunction
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`In its Motion, the FTC also argues that Defendants cannot insert their bias arguments—
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`arguments that Defendants would otherwise be barred from bringing as a complaint per Axon and
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`Jarkesy—by recasting them as defenses rebutting the FTC’s required showing for Section 13(b)
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`relief. Mot. 12-13. Defendants respond that they may assert Chair Khan’s alleged bias as a
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`defense because, regardless of whether district courts can properly hear such arguments, a Court of
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`Appeals may hear those arguments in an appeal from an FTC final order. 15 U.S.C. § 45(c). And
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`“ultimate success” under Section 13(b), Defendants argue, contemplates appellate success before a
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`Court of Appeals. Opp. 11-13. The FTC notes in reply that “ultimate success” only refers to
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`success before the Federal Trade Commission on antitrust merits. Reply 5.
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`As discussed supra at Section II, Rule 12(f) permits the Court to strike any impertinent
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`matters, i.e., matters that “consist[] of statements that do not pertain, and are not necessary, to the
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`issues in question.” Fantasy, 984 F.2d at 1527; Fed. R. Civ. P. 12(f). Courts in the Ninth Circuit
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`have stricken defenses that raise irrelevant issues to the action, as “[s]triking these defenses
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`advances the essential function of Rule 12(f) by avoiding the expenditure of time and money in
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`litigating [] spurious issue[s].”2 F.T.C. v. Lights of Am. Inc., 2011 WL 13308569, at *5 (C.D. Cal.
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`Apr. 29, 2011); see also F.T.C. v. Loss Mitigation Servs., 2010 WL 11519447, at *2 (C.D. Cal.
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`Feb. 17, 2010) (“Courts may strike affirmative defenses as insufficient when they are inapplicable
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`to the claims asserted.”). Accordingly, the Court must assess whether Defendants’ bias-related
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`affirmative defenses are pertinent to the FTC’s Section 13(b) request for a preliminary injunction.
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`a.
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`“Ultimate Success”
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`The Court first addresses whether Section 13(b) requires evaluation of the FTC’s success
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`in its own administrative forum or before a Court of Appeals. Mot. 12-13; Opp. 11-12. Section
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`13(b) provides, in relevant part, “Upon a proper showing that, weighing the equities and
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`considering the Commission’s likelihood of ultimate success, such action would be in the public
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`interest, and after notice to the defendant, a temporary restraining order or a preliminary injunction
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`may be granted without bond.” 15 U.S.C § 53(b)(2). The Ninth Circuit has interpreted this
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`statutory directive as a two-part inquiry: the Court must “1) determine the likelihood that the
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`2 At least one court has also stricken affirmative defenses asserted against the FTC where such
`defenses would “threaten to shift litigation attention and discovery towards the FTC’s actions,
`rather than Defendants’ actions.” F.T.C. v. Am. Tax Relief, LLC, 2011 WL 13135578, at *1 (C.D.
`Cal. Oct. 19, 2011).
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`Commission will ultimately succeed on the merits and 2) balance the equities.” F.T.C. v. Warner
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`Commc’ns Inc., 742 F.2d 1156, 1160 (9th Cir. 1984) (emphasis added) (citing F.T.C. v. Simeon
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`Mgmt. Corp., 532 F.2d 708, 713–14 (9th Cir. 1976)).
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`Although neither party has alerted the Court to any authority directly addressing in which
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`forum “ultimate success” should be measured, the overall weight of case law applying Section
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`13(b) supports the FTC’s interpretation, i.e., that courts predict likelihood of success on the merits
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`at the FTC’s administrative proceedings. For example, in F.T.C. v. Simeon Mgmt. Corp., Judge
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`Orrick denied the FTC’s request for preliminary injunction by finding that it did “not have a
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`strong likelihood of establishing [the requisite showing] at the administrative proceedings on their
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`complaint before the Commission . . . .” 391 F. Supp. 697, 704 (N.D. Cal. 1975) (emphasis
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`added). On appeal, the Ninth Circuit held that Judge Orrick had applied the correct standard,
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`which it characterized as a “determination on the likelihood that the FTC will succeed on the
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`merits in proceedings for a final cease-and-desist order.” 532 F.2d at 713–14.
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`Other federal courts have similarly focused their Section 13(b)’s predictive inquiry on the
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`underlying agency proceedings rather than on a hypothetical appeal from a yet-to-be-developed
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`administrative record. See F.T.C. v. H.J. Heinz Co., 246 F.3d 708, 714 (D.C. Cir. 2001) (“To
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`determine likelihood of success on the merits we measure the probability that, after an
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`administrative hearing on the merits, the Commission will succeed in proving . . .”) (emphasis
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`added); F.T.C. v. Staples, Inc., 239 F. Supp. 3d 1, 5 (D.D.C. 2017) (“Under Section 13(b), the
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`Court’s task is to assess the likelihood of whether or not the government can prevail at a
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`subsequent administrative hearing before the Federal Trade Commission, not whether the
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`proposed merger would violate the Clayton Act.”) (emphasis added); F.T.C. v. Swedish Match,
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`131 F. Supp. 2d 151, 155 (D.D.C. 2000) (“[T]he Commission must demonstrate the likelihood that
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`it will succeed in proving, after a full administrative trial on the merits, that the effect of [the]
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`acquisition [] may be substantially to lessen competition.”) (emphasis added).
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`Defendants primarily rely on two excerpts from Simeon and Warner to support their
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`interpretation of “ultimate success.” Opp. 11-12. Neither case, however, extend as far as
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`Defendants want them to. In Simeon, the Ninth Circuit did remark that a “favorable initial
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`decision does not necessarily assure the FTC of ultimate success,” but there was otherwise no
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`reference or indication that “ultimate success” should be based on what a Court of Appeals may
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`consider. 532 F.2d at 715. To the contrary, Simeon instructed courts considering a Section 13(b)
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`request to focus on the FTC’s proceedings and expressly declined to comment on the case’s future
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`disposition following the FTC’s final decision. Id. at 715-16 (“In predicting whether such success
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`is likely, it is necessary to determine whether the FTC’s initial decision applied the proper legal
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`standard.”) (emphasis added); id. at 717 (“We intimate no view in this opinion as to the
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`appropriate disposition in that case [after the Commission has reached a final decision].”).
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`Defendants also refer to Warner’s quotation of the commonly iterated Section 13(b)
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`standard, that the FTC meets its burden if it “raise[s] questions going to the merits so serious,
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`substantial, difficult and doubtful as to make them fair ground for thorough investigation, study,
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`deliberation and determination by the FTC in the first instance and ultimately by the Court of
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`Appeals.” 742 F.2d at 1162 (emphasis added) (quoting F.T.C. v. Nat’l Tea Co., 603 F.2d 694, 698
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`(8th Cir. 1979)). Despite the brief reference to the Court of Appeals at the close of this standard,
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`the quote’s primary focus is on the Court’s evaluation of the merits and makes no suggestion that
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`the Court should also include non-merits issues that may only be raised on appeal. Indeed, the
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`opinion from which this quote originated had emphasized that the scope of the Section 13(b)
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`inquiry is necessarily limited and narrow. See F.T.C. v. Lancaster Colony Corp., 434 F. Supp.
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`1088, 1091 (S.D.N.Y. 1977) (“As a practical matter, a district court can hardly do more at so early
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`a stage of antitrust litigation than to make a considered estimate of the FTC’s apparent chances of
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`success based upon what must necessarily be an imperfect, incomplete and fragile factual basis.”).
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`Finally, Defendants argue that, if success is measured by the FTC’s success in its
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`administrative proceedings, then any “likelihood of success” inquiry would be perfunctory
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`because the FTC has not lost a case in its home forum for the past quarter-century. Opp. 12. This
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`argument mischaracterizes the Court’s role in a Section 13(b) request. District courts do not
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`determine “likelihood of success” by a statistical calculation of the parties’ odds, but instead are
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`charged with exercising their “independent judgment” and evaluating the FTC’s case and evidence
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`on the merits. Lancaster, 434 F. Supp. at 1090. And, notwithstanding the FTC’s success rate, this
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`obligation has resulted in district courts occasionally reaching differing conclusions from those in
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`the underlying FTC proceedings. See Simeon, 532 F.2d at 715-16 (noting that district court had
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`denied Section 13(b) application as unlikely to succeed on the merits, but the FTC subsequently
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`reached a contrary conclusion).
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`In summary, the Court considers Section 13(b)’s “likelihood of ultimate success” inquiry
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`to mean the likelihood of the FTC’s success on the merits in the underlying administrative
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`proceedings, as opposed to success following a Commission hearing, the development of an
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`administrative record, and appeal before an unspecified Court of Appeals.
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`b.
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`“Success on the Merits” and “Balancing of Equities”
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`Having determined where its predictive inquiry should be focused, the Court evaluates
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`whether Chair Khan’s alleged bias is pertinent to the FTC’s success on the merits or the balancing
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`of equities. See Warner, 742 F.2d at 1160. The Court finds that neither prong of the Section 13(b)
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`inquiry would permit consideration of the FTC’s alleged bias.
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`With respect to the first prong, the Court interprets “on the merits” here to mean the
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`action’s Section 7 antitrust merits, as distinguishable from any procedural due process issues
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`arising from the FTC’s proceedings. First, the oft-cited standard for “likelihood of ultimate
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`success” describes merits questions as those that would require “thorough investigation, study,
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`deliberation and determination by the FTC,” a characterization that is consistent with a
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`“preliminary assessment of [a] merger’s impact on competition.” Warner, 742 F.2d at 1162; see
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`also H.J. Heinz Co., 246 F.3d at 714 (“To determine likelihood of success on the merits we
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`measure the probability that, after an administrative hearing on the merits, the Commission will
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`succeed in proving that the effect of the [] merger ‘may be substantially to lessen competition, or
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`to tend to create a monopoly.’”). Put differently, “thorough investigation, study, deliberation and
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`determination by the FTC” would be an odd description for issues that can only arise out of the
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`FTC’s own proceedings, such as those relating to the FTC’s authority, bias, or due process
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`Case No.: 5:22-cv-04325-EJD
`ORDER GRANTING IN PART MOTION TO STRIKE
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`Northern District of California
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`United States District Court
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`Case 5:22-cv-04325-EJD Document 173 Filed 11/02/22 Page 10 of 15
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`violations. Second, Defendants have not identified any case where a district court—in evaluating
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`the likelihood of FTC success for a Section 13(b) injunction request—considered evidence of the
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`FTC’s alleged bias or administrative due process violations. See Hr’g Tr. 28:9-17, Oct. 21, 2022.
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`To the contrary, the Ninth Circuit in Warner, when confronted with facts that could have
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`suggested bad faith from the FTC, did not address or consider those facts in its “success on the
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`merits” discussion and instead affirmed that its task was to “make only a preliminary assessment
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`of the merger's impact on competition.”3 Warner, 742 F.2d at 1162. Given that courts have
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`typically reserved their “on the merits” discussions to substantive antitrust questions and none
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`have considered issues of agency bias on a Section 13(b) action, the Court finds that Chair Khan’s
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`bias is not pertinent to its assessment of the FTC’s success on the merits.
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`Nor is Chair Khan’s bias pertinent to the Court’s balancing of equities under Section 13(b).
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`Although Defendants’ allegations of agency bias or due process violations appear to be relevant
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`equitable considerations at first glance, courts applying Section 13(b) consider a narrower set of
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`equities. Public equities, which include “economic effects and pro-competitive advantages for
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`consumers and effective relief for the commission,” are accorded greater weight than private
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`equities. F.T.C. v. World Wide Factors, Ltd., 882 F.2d 344, 347 (9th Cir. 1989); see also
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`Lancaster, 434 F. Supp. at 1096 (“The equities to be weighed here are not the usual equities of
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`private litigation but public equities.”). By contrast, “private equities alone do not outweigh the
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`Commission’s showing of likelihood of success.” Warner, 742 F.2d at 1165. Moreover, the
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`private equities considered on a Section 13(b) request are not typically those arising out of the
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`FTC’s administrative proceedings themselves, but rather the private consequences resulting from
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`the requested injunction. Id. (considering private equities of forcing the defendants to abandon the
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`joint venture, the companies’ inability to operate effectively due to uncertainties over the proposed
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`3 Notably, the referenced evidence in Warner were internal FTC memoranda recommending that
`the Commission not challenge the merger in question, which resembles one of Defendants’
`arguments here. See Meta Answer 1 (“Ignoring the FTC staff who conducted a review of this
`transaction and determined that no enforcement action was warranted, Chair Khan engineered a 3-
`2 Commission vote to overrule the staff.”).
`Case No.: 5:22-cv-04325-EJD
`ORDER GRANTING IN PART MOTION TO STRIKE
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`Case 5:22-cv-04325-EJD Document 173 Filed 11/02/22 Page 11 of 15
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`transaction, and allowing shareholders to reap their benefits from the merger). Accordingly, the
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`Court also finds that Chair Khan’s bias would not be pertinent in its balancing of equities.
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`The Court emphasizes that these conclusions are primarily driven by the narrow review
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`accorded to district courts by Section 13(b) to evaluate “likelihood of ultimate success.” See supra
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`Section III(A)(2)(a); Warner, 742 F.2d at 1164 (noting that “the issue in this action for preliminary
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`relief is a narrow one”); cf. F.T.C. v. Food Town Stores, Inc., 539 F.2d 1339, 1342 (4th Cir. 1976)
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`(“The only purpose of a proceeding under § 13 is to preserve the status quo until FTC can perform
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`its function.”). In other words, the Court is not turning a blind eye to Meta’s defenses but rather
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`focusing its sights on the direction set by statute. The Court makes no opinion as to Defendants’
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`likelihood of success on its objections to the FTC’s agency process, which they may raise on
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`appeal from an FTC final order or could have conceivably raised as a request for pre-enforcement
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`relief. See Axon, 986 F.3d at 1182-83 (quoting Tilton v. S.E.C., 824 F.3d 276, 286 (2d Cir. 2016)
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`(noting pre-enforcement review may be available where “proceeding itself posed a risk of some
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`additional and irremediable harm beyond the burdens associated with the dispute resolution
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`process”). Within the limited Section 13(b) framework, however, Meta’s bias-related defenses
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`“do not pertain, and are not necessary, to the issues in question.” Fantasy, 984 F.2d at 1527.
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`Accordingly, the Court finds that Chair Khan’s bias is not pertinent to its consideration of
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`the FTC’s success on the merits or the balancing of equities. Because these issues with Meta’s
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`bias-related defenses are legal and foundational in nature, amendment would be futile. See F.T.C.
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`v. OMICS Grp. Inc., 2017 WL 6806802, at *4 (D. Nev. Dec. 15, 2017), report and
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`recommendation adopted, 2018 WL 297581 (D. Nev. Jan. 3, 2018). The Court also finds that the
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`FTC would likely be prejudiced by permitting Defendants’ bias-related defenses to stand, as they
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`would “threaten to shift litigation attention and discovery towards the FTC’s actions, rather than
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`Defendants’ actions.” F.T.C. v. Am. Tax Relief, LLC, 2011 WL 13135578, at *1 (finding
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`prejudice where “[a]ll of the true affirmative defenses that Defendants have raised open up entirely
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`new areas to discovery”).
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`The Court therefore GRANTS the FTC’s Motion and STRIKES Meta’s Eighteenth and
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`Case No.: 5:22-cv-04325-EJD
`ORDER GRANTING IN PART MOTION TO STRIKE
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`Northern District of California
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`United States District Court
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`Case 5:22-cv-04325-EJD Document 173 Filed 11/02/22 Page 12 of 15
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`Nineteenth Affirmative Defense WITHOUT LEAVE TO AMEND.
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`B.
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`Constitutional Defenses
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`Both Defendants also assert identical constitutional defenses, alleging that the FTC’s
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`exercise of executive authority violates Article II of the United States Constitution and that the
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`present proceedings against Defendants are barred by the Due Process Clause. Meta Answer 14-
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`15; Within Answer 12-13, Dkt. No. 13; see also supra n.1.
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`The Court’s assessment of these constitutional affirmative defenses overlaps significantly
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`with its analysis of Defendants’ bias-related defenses, particularly regarding the Court’s ability to
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`consider these arguments in the limited procedural posture of a Section 13(b) preliminary
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`injunction request. See supra Section III(A)(2). Accordingly, to the extent Defendants’
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`constitutional defenses are predicated on Chair Khan’s alleged bias or procedural deficiencies,
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`these defenses would likewise be stricken without leave to amend.
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`However, the Court finds that Defendants’ constitutional defenses are inadequately pled, as
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`each consists of a single sentence asserting relief arising out of either Article II of the U.S.
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`Constitution or the Due Process Clause. In the absence of any factual allegations, Defendants’
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`constitutional defenses do not provide fair notice as to the bases for these defenses and, therefore,
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`are insufficient “even under the most liberal of pleading standards.” MIC Prop. v. Kennolyn
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`Camps, Inc., 2015 WL 4624119, at *5. For the same reasons, the Court also cannot ascertain that
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`further factual amendments would be futile.
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`Accordingly, the Court GRANTS the FTC’s Motion as to Meta’s Seventeenth and Twenty-
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`First Affirmative Defenses and Within’s Seventeenth and Nineteenth Affirmative Defenses.
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`These defenses are STRICKEN WITH LEAVE TO AMEND.
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`C.
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`Selective Enforcement
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`Meta’s Fourteenth Affirmative Defense states, “The Complaint reflects improper selective
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`enforcement of the antitrust laws.” Meta Answer 1