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LabMD 1st Amendment Claims Against FTC Survive Dismissal

Law360, New York (April 3, 2017, 3:46 PM EDT) -- Two Federal Trade Commission investigators must face accusations by LabMD that they violated the First Amendment and ultimately destroyed the business by ramping up their investigation of a data security incident after the company’s CEO criticized the agency, a D.C. federal judge ruled Friday.

LabMD and its CEO Michael Daugherty claimed in a November 2015 lawsuit that FTC employees Alain Sheer, Ruth Yodaiken and Carl Settlemyer launched an investigation into its data security practices based on information stolen from LabMD by cybersecurity firm Tiversa Holding Corp., and then violated the First Amendment by escalating that investigation immediately after Daugherty publicly criticized...

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