50
Oral History of Katherine Mazzaferri
This interview is being conducted on behalf of the Oral History Project of The Historical
Society of the District of Columbia Circuit. The interviewer is Annamaria Steward, and the
interviewee is CEO Emeritus of the D.C. Bar Katherine Mazzaferri. The interview took place on
Sunday, July 16, 2023. This is the sixth chapter.
MS. STEWARD: Katherine, tell us about your start at the Federal Trade Commission.
MS. MAZZAFERRI: Good morning, Annamaria. I started at the FTC in July of 1978. I was the
Assistant Director for Advertising Practices. This job was my introduction
to the legislative process of the United States. I really had no experience
before that. I supervised several administrative investigations about
deceptive advertising practices, but one of my primary responsibilities was
to oversee the Children’s Advertising Rulemaking. The proposed rule had
been put out for comment before I got to the FTC.
MS. STEWARD: What was this rule about?
MS. MAZZAFERRI: The proposed rule sought a ban on all advertising that was directed to
children who were too young to understand the content. It would propose
to ban advertising directed to kids for food products that pose a serious
dental health risk. It also would require that television advertising for
sugared food products that were not included in this ban but that were
directed to audiences with a significant proportion of older children be
balanced by nutritional or health disclosures funded by the advertisers. So
it was a pretty broad proposal to address the FTC’s concerns about
advertising to children or directed to children.
MS. STEWARD: How was the rule received?
51
MS. MAZZAFERRI: There were several industries that were impacted, and there was a lot of
opposition. Some consumer groups were in favor of it, but as an example
of the opposition, the three national advertising industry groups brought a
lawsuit in federal district court to ask that the Chairman of the FTC,
Michael Pertschuk, be recused from considering the Children’s
Advertising Rulemaking. They believed he had already expressed his
personal views about what the outcome should be.
MS. STEWARD: It is interesting that the advertising industry groups brought it and not the
actual industries.
MS. MAZZAFERRI: Right. This again was my first exposure to an aspect of the legislative
process that when there is money involved, it really brings to the fore the
industries that are potentially impacted. So, there must be a lot of money
in advertising, and those industries did not want to see their advertising
impacted by a regulation of the Federal Trade Commission.
MS. STEWARD: Did they succeed in getting Chairman Pertschuk recused from the case?
MS. MAZZAFERRI: They did. On November 3, 1978, U.S. District Court Judge Gerhard Gesell
blocked Chairman Pertschuk from further consideration of the Children’s
Advertising Proceeding.
MS. STEWARD: So clearly this was a hot issue.
MS. MAZZAFERRI: It was a very hot issue. There was a lot of interest on Capitol Hill about
what the FTC was doing, and as I said, there was this challenge in federal
district court as well.
52
MS. STEWARD: So, you get this case when you first arrive. It lands in your lap. What did
you have to do? I’m going forward because now you have a chairman
recused from it so you’re leading this rulemaking?
MS. MAZZAFERRI: That’s right. I oversaw the presentation of about thirty expert witnesses.
We prepared memoranda on some complex legal issues, and we held
hearings both in San Francisco and in Washington, D.C. There was a lot of
scientific and expert testimony about the impact on children of various
types of television ads. It was a very interesting substantive investigation.
MS. STEWARD: We mentioned the advertising industry and presumably the cereal making
and food industry. What other industries were involved?
MS. MAZZAFERRI: There really was a broad range of industries that were impacted
potentially, cereal and candy manufacturers, toy companies, and as we’ve
talked about, the national advertising groups. The different groups went to
Congress, and Congress let the FTC funding lapse in early May of 1980.
The agency was briefly shut down because of the pressure on the Hill
from the industries.
MS. STEWARD: So there’s also another FTC act that was happening at the same time as
this was going on for you.
MS. MAZZAFERRI: Right. In 1980, the Congress adopted the FTC Improvements Act of 1980.
This legislation amended the FTC Act to prohibit the FTC from issuing
any rule pertaining to children’s advertising under the fairness doctrine.
There were some other doctrines the agency could use, but not the fairness
53
doctrine. Congress added a provision that would allow a two-chamber
legislative veto of FTC regulations.
MS. STEWARD: So, this is not your first time in a hot issue. I mean you had dealt with
many challenging situations coming from the EEOC, so what was your
reaction to this? A case you’re working on has now resulted in the entire
agency being shut down, so what did you do next?
MS. MAZZAFERRI: There were a lot of complicated and conflicting concerns. First of all, in
my personal view, the agency had a strong position on the need to regulate
advertising to children. It was clear to me that the advertising was
purposely being directed to kids because the advertisers knew that this was
a successful way to encourage families to purchase certain types of
products. But we began to worry that the remedies available to the FTC
might not be the right remedies on this issue and also that it was damaging
to the agency itself. It was a tough time.
MS. STEWARD: So at this point you didn’t have any other choice but to negotiate with the
industries because you were being disempowered by the Congress.
MS. MAZZAFERRI: Right. We struggled with what to do and very reluctantly decided to
recommend that we figure out a way to come to a compromise with the
industries and close down the investigation.
MS. STEWARD: And is that what happened?
MS. MAZZAFERRI: Yes. It took some time, and there were a lot of conversations, but the staff
thought we should compromise. We had many conversations about what
54
the next steps could be. Ultimately the investigation ended in October of
1981.
MS. STEWARD: So this was a learning experience for you. What other key things happened
for you during that time at the Federal Trade Commission?
MS. MAZZAFERRI: Al Kramer was the very hard-driving director of the Bureau of Consumer
Protection. He gave me the opportunity to be part of a Senior Executive
Service, SES, training program that included an assignment that was
outside of the FTC. It was a really eye-opening and wonderful experience
for me. It was the first time I’d had any management training experience,
and I was very grateful to Al for having considered me for that
opportunity. It was an 18-month candidate SES development program that
included a three-month developmental assignment in the summer of 1980.
MS. STEWARD: Where was your developmental assignment?
MS. MAZZAFERRI: I was the director of the regulatory analysis project at the United States
Regulatory Council.
MS. STEWARD: What did you all do for the United States Regulatory Council?
MS. MAZZAFERRI: The purpose of the project was to assess the progress of regulatory
analysis in government. We developed a survey instrument, surveyed ten
agencies, and issued a report that summarized our findings and offered
recommendations. It was published in June of 1981.
MS. STEWARD: After you had this case involving advertising for children and then you
went to this SES training program, what happened for you next at the
Federal Trade Commission?
55
MS. MAZZAFERRI: In September of 1980, I officially became part of the Senior Executive
Service, and I took on the role of the Assistant Director for Product
Reliability.
MS. STEWARD: Now you’re in a leadership position, so what did you do as the Assistant
Director for Product Reliability?
MS. MAZZAFERRI: I managed several investigations, and one of the key ones that I oversaw
was the rulemaking on the Used Car Rule. This was my next lesson in the
legislative process.
MS. STEWARD: I can imagine that the Used Car Rule was probably another hot button
issue, so can you tell us about that proposed rule and the impact it had on
the industry and on the agency?
MS. MAZZAFERRI: The rulemaking proposal had been put out for comment before I took on
this new role, and I needed a strong leader to manage this important
initiative. I hired Susan Liss to head up the investigation. She was very
capable and very savvy. As it turned out, this was a long and convoluted
role, but Susan was up to that task.
In May of 1980, the Commission had tentatively adopted a
Proposed Rule about the Sale of Used Motor Vehicles, and in August of
1980 the Commission had published the Used Car Rule in the Federal
Register. But in April of 1981, the Commission rejected the staff proposal,
which would have encouraged dealers to inspect vehicles, and instead
modified the rule to focus on the disclosure of warranty information.
56
MS. STEWARD: That clearly undermined a big aspect of the proposed rule, so what
happened next? You have this proposed rule, you get a modified proposal,
and was that modified proposal accepted?
MS. MAZZAFERRI: In August of 1981, the Commission adopted and published in the Federal
Register the Proposed Trade Regulation Rulemaking Pertaining to Used
Cars. Later that month, the National Automobile Dealers Association filed
suit in federal court to block the used car rule, and in September of 1981,
consistent with that earlier amendment to the FTC Act, the FTC sent the
used car rule to the House and Senate Commerce Committees.
MS. STEWARD: So, this is another example of when the affected industry had a lot of
power over the proposed rule coming from the Federal Trade
Commission. What happened in this case?
MS. MAZZAFERRI: In May of 1982, the House and Senate vetoed the FTC’s Used Car Rule.
That was the only time that this legislative veto that was established in
1980 was used. Consumer groups challenged the constitutionality of the
legislative veto.
I left the FTC in June of 1982, but this used car saga wasn’t over.
On July 6, 1983, the U.S. Supreme Court affirmed the D.C. Circuit’s
decision that the legislative veto provision was unconstitutional. So, there
was a resolution about disclosing information to consumers about used
cars. It wasn’t as robust as what the staff had proposed, but there is a
sticker called the “Buyer’s Guide” that can be found on used cars today. It
discloses whether there’s a warranty on the car and if so, what systems are
57
covered and what percentage of the costs for repairs the dealer will cover.
It wasn’t what the staff had proposed, but it was more than what we had
before.
MS. STEWARD: Do you want to add anything more about your experience with the Federal
Trade Commission?
MS. MAZZAFERRI: There was one thing I thought was interesting. As I mentioned, we held
many hearings on the Used Car Rule. Some of the dealers testified that
they thought disclosing what was wrong with a used automobile was a
good practice and that they did that because they found that it was good
for business. Families would return to them to buy other cars for their
children or their grandchildren. I thought it was interesting that what we
were proposing was not at all far-fetched. It was consistent with how these
dealers were handling their businesses. It was always interesting that there
were different points of view about all these investigations and projects.
MS. STEWARD: As always when we talk about these chapters of your life, what were the
lessons learned from your experience at the Federal Trade Commission?
MS. MAZZAFERRI: Lots of interesting lessons. As I mentioned, I got a fundamental
understanding of how the legislative process works. When I was at EEOC
I was the beneficiary of the fact that there were some wonderful statutes
that I could work to implement, but at the FTC, it was in some ways the
opposite. The statutes there were being challenged in a way that made it
difficult to implement some of the underlying purposes. So, it was an
experience to know that there’s always a process. It’s important to look at
58
all the options, and sometimes the option you think is the best one may
have to be modified to get something out of the effort that you are
undertaking.
MS. STEWARD: You left the Federal Trade Commission in June of 1982. Why did you
decide to leave and where did you go next?
MS. MAZZAFERRI: With the change in the Administration, it was clear that the focus of the
federal government would change. I knew the FTC would have a less
consumer-oriented focus.
I began to look around. I had served on the board of the
Washington Council of Lawyers in the late 1970s and had done some
mediation training in 1982, so I was looking to other types of
opportunities.
I decided to look for an opportunity at the D.C. Bar. I had served
on a steering committee of the Labor Law Section from 1974 to 1975, and
I also was on the nominations committee of the Administrative Law
Section of the Bar in 1980. I had some exposure to the Bar from that
perspective. The D.C. Bar executive director job seemed like something
that could combine some of the skills that I had learned from my
experience in other positions.
MS. STEWARD: Thank you, Katherine. This ends our Federal Trade Commission chapter.