U.S. judge will not block Intuit TurboTax ads that FTC found deceptive

[April 23, 2022]  By Jonathan Stempel

(Reuters) -A U.S. judge on Friday refused to block TurboTax maker Intuit Inc from running ads for "free" tax filing that the Federal Trade Commission said deceived millions of taxpayers.

U.S. District Judge Charles Breyer in San Francisco denied the FTC's request for a preliminary injunction for three reasons.

Breyer found the risk of future harm "attenuated" because the main April 18 tax filing deadline has already passed, most taxpayers have filed their taxes, and Intuit said it has largely finished advertising for this tax season.

The judge also said Intuit had removed several of the more "plausibly deceptive" ads, some repeating the word "free" a dozen times or more in 30 seconds before brief disclaimers.

Finally, Breyer said an FTC administrative law judge will review Intuit's ad practices at a Sept. 14 hearing, and likely rule before the company's ad campaign resumes.

The FTC can return to court if Intuit resumes its ads before the administrative law judge rules.

Intuit, based in Mountain View, California, ran some of the challenged ads during this year's Super Bowl and NCAA college basketball tournament, the FTC said.

An Intuit office is shown in San Diego, California August 21, 2015. The tax-preparation software maker reported a fourth-quarter adjusted loss as expenses rose 17 percent and the company also forecast an adjusted loss for the current quarter. Intuit also said it plans to divest Demandforce, QuickBase and Quicken. REUTERS/Mike Blake

An FTC spokesman declined to comment.

Intuit said it was pleased with the ruling and will continue defending against the FTC's claims.

"We are clear and fair with our customers and open and transparent about our advertising practices," the company said in a statement.

In its March 28 lawsuit, the FTC said about two-thirds of tax filers, including gig workers and people with farm income, could not use TurboTax's free product despite ad slogans such as: "TurboTax Free is free. Free free free free."

The FTC enforces antitrust law and laws against deceptive ads.

(Reporting by Jonathan Stempel in New York; Editing by Leslie Adler and Will Dunham)

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