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Since her confirmation, Chairwoman Khan has moved to silence dissent by controlling the speech of those working at the agency and consolidated power in ways that have removed the healthy debate that Congress intended when it created the five-member Commission and that call into question the independence of the agency.
Here's a timeline of the agency's overreach:
The FTC and DOJ finally issue their long-awaited Draft Merger Guidelines. As the Chamber explains, the proposed guidelines attempt to rewrite decades of antitrust policy by relying on outdated precedent, expressing open hostility to vertical mergers, and ignoring the decades-old consensus that mergers can enhance efficiency.
The House Government Oversight Committee launches an investigation to probe FTC Chair Khan’s “abuse of power” including the circumstances that led to Commissioner Wilson’s resignation. The Chamber applauds the move and is working with several committees engaged in oversight. .
New reports raise very troubling questions about Chair Khan’s leadership of the FTC. During a hearing earlier this year, Chair Khan represented to Congress that she had followed ethics advice by not recusing herself from review of the Meta-Within merger.
- In reality, the FTC’s ethics official recommended that Khan remove herself from the case to avoid the appearance of bias. The ethics official further advised that, “no FTC employee has participated in a specific party matter when the agency designee has recommended recusal on appearance or other federal ethics grounds.” Chairwoman Rodgers and Chairman Jordan, who lead two committees with oversight authority over the FTC, last week sent a letter accusing Chair Khan of misleading Congress.
The FTC solicits comments on “how franchisors may exert control over franchisees and their workers,” apparently with a view toward issuing a labor-oriented rule that would govern the relationship among franchisors, franchisees, and workers. In comments and a blog, we explain that any such rule could end the franchise model and eliminate millions of small businesses.
The Chamber files comments strongly opposing the FTC’s proposed rule regulating how companies can sell subscription services. While the Chamber supports companies being transparent about subscription terms and making it easy for customers to cancel, the proposed rule exceeds the Commission’s authority, is not grounded in clear evidence of prevalent economic harm and substitutes the Commission’s judgment for that of private companies.
The FTC and DOJ announce a revision to the HSR rule that would dramatically expand the costs of reporting requirements for filing a merger by hundreds of millions of dollars while potentially adding months to the process. Many antitrust practitioners believe the draft rule may have a larger impact than the new merger guidelines. This is because the guidelines reflect the agencies’ thinking that has already begun to be rejected by the courts.
The Federal Trade Commission continues to bring merger challenges without any evidence of competitive harm, a timeline for when harm might occur, or a meaningful understanding of how markets operate. Amgen, a large biopharmaceutical company, agreed to acquire Horizon Therapeutics, a much smaller company that manufactures so-called orphan drugs. As we explain, this acquisition raises no genuine competitive concerns because the companies don’t compete with each other in any market, yet the merger could benefit patients by allowing the combined company to ramp up production. The FTC, however, speculates that if any competitors eventually manage to receive FDA approval, Amgen might respond by offering bundled discounts on a suite of drugs, and those discounts could allow the combined company to keep prices high. As the Chamber explains, the FTC’s potential competition theories are conjecture wrapped in speculation served with a side of supposition.
- The case shows that the FTC is willing to challenge virtually any merger, particularly in industries that its current leadership seems to disfavor, without any economic evidence that shows competitive harm. Based on this and other speculative merger challenges, including Illumina-Grail, Meta-Within, and Microsoft-Activision, the FTC and the Department of Justice are likely to revise the merger guidelines in ways that challenge longtime consensus views about the benefits of mergers and the evidence required to block them. In the words of the Wall Street Journal, “no theory is too strange” for this FTC to try to block a merger.
The European Union approves Microsoft’s purchase of Activision-Blizzard based on Microsoft’s commitment to make its most popular games available on rival platforms. The United Kingdom has rejected the merger. The Chamber and others are explains that merger review policies are harming U.S. competitiveness.
The House Judiciary committee sends a letter to Chair Khan expressing its frustration that the FTC has been largely nonresponsive to its request for documents. The May 31st letter suggests that engagement with staff indicates that many of the documents sought were now deleted. This letter seeks information on the FTC document retention policies and procedures.
The Chamber urges the Biden Administration to stop the FTC and DOJ from undermining U.S. international economic policy. In a letter to the National Security Council and National Economic Council, with copies to multiple Cabinet officials and congressional leaders, we explain that the agencies are applying their vision of competition policy in a way that undermines U.S. economic and security interests abroad.
- Specifically, the agencies are helping foreign governments pursue protectionist policies that directly harm U.S. companies, such as by sending U.S. employees to Europe to “assist with the implementation of the Digital Markets Act.” Moreover, the agencies are opposing the inclusion of due process and procedural fairness provisions in the competition chapter and the trade provisions in the digital trade chapter of the Indo-Pacific Economic Framework, provisions which were part of the bipartisan U.S.-Mexico-Canada Agreement.
A new report reveals that the FTC’s senior attorneys are leaving at a pace not seen this century. Chair Khan concedes that the agency may be too strapped to conduct a study of the electric industry sought by several members of Congress and a coalition of advocacy groups. Despite these and other management concerns, in its annual budget request, the FTC is seeking a 400% increase over its current appropriation.
The FTC loses its challenge to Meta’s acquisition of Within as a court declines to enjoin the merger. The FTC later decides not to appeal the decision and to abandon its administrative challenge. The Chamber sent a letter to Congress which stated:
- The U.S. Chamber of Commerce has grave concerns about the leadership of Lina Khan, due process, and accountability at the Federal Trade Commission. We strongly urge you to conduct oversight, including hearings, of the current Commissioners regarding agency mismanagement. Additionally, Congress should refrain from granting the Commission any further rulemaking or enforcement authority until it conducts a thorough investigation and oversight and puts forward reasonable guardrails around agency activity.
Commissioner Christine Wilson announces her resignation from the FTC, and in so doing accuses the Chair of engaging in numerous improprieties. The Chamber issues a statement thanking Ms. Wilson for her service, and also calls for additional oversight and the prompt confirmation of new nominees. With Ms. Wilson’s departure, the FTC has only three remaining commissioners, Chair Khan and Commissioners Slaughter and Bedoya.
President Biden renominates Ms. Slaughter for a full term but does not nominate anyone for the other two spots. Prior to announcing her departure, Ms. Wilson issues a sharp dissent from the Commission’s decision not to require Chair Khan to recuse herself from participation in review of the Meta-Within merger. The Commission finds that Ms. Khan need not recuse herself because her prior statements about Facebook involved a “different industry” and a “different acquiring company” than Meta. Ms. Wilson, on the other hand, contends that Ms. Khan ignored ethical concerns.
The Chamber, the National Retail Federation, and more than 100 other trade associations sends a letter to the FTC asking it to extend the comment deadline beyond March 20, given the magnitude of the noncompete proposal. The Chamber, joined by more than 260 other trade associations, sends a letter to Capitol Hill asking Congress to exercise its oversight and appropriations authority to review the rulemaking.
In response to the Chamber’s FOIA request and lengthy litigation regarding a merger between two biotech companies, the FTC finally turns over heavily redacted emails. Those emails strongly suggest that the FTC reached out to foreign competition agencies to encourage them to object to the merger, despite the lack of any meaningful nexus with those jurisdictions. The Wall Street Journal’s editorial board wrote about this issue here. The Chamber describes and publishes the emails here and here.
Relying on its supposed authority under Section 5, the FTC proposes a rule to ban almost all non-competes around the country. If this proposed rule goes into effect, it will unwind millions of contracts around the country, hamstring the ability of employers to protect their intellectual property and investments in employees, and disregard hundreds of years of practice in which courts have upheld non-compete clauses as reasonable and enforceable.
In response, the Chamber has issues a public statement and CEO Suzanne Clark publishes an editorial in the Wall Street Journal. We also question the economic impact the FTC claims this rule will have on wages and signal what rules might come next. You can read more on the issue here.
In a new policy statement outlining its views of Section 5 of the FTC Act, the agency declares that it may deem many types of routine business conduct as “unfair methods of competition,” without any showing of harm to consumers or anticompetitive intent. In particular, the FTC announces that it may be illegal for companies to compete in ways that harm competitors (rather than just consumers), disadvantage workers, use intellectual property, or rely on economies of scale. As the Chamber explains in its primer, the FTC is likely to use this authority to target companies and business practices that do not conform to its progressive policy agenda, irrespective of the impact on consumers. Still, the FTC faces a myriad of constraints. The FTC will have to pick its targets and the courts are very unlikely to endorse the FTC’s sweeping claims of authority, which selectively ignore decades of court precedent.
In a policy statement on gig workers, the FTC once again demonstrates its desire to control large segments of the national economy. In the statement, the FTC promises to protect workers from “unfair contract terms” given their “diminished bargaining power.” Of course, the FTC should protect people from false and misleading claims, but as dissenting Commissioner Christine Wilson explains, the FTC’s policy statement “is another step in the effort to shift the Commission’s attention from its traditional mission of protecting consumers and competition” in favor of “mercurial political winds.” As the Chamber explains, the FTC’s policy statement, if enforced in ways that exceed its statutory mission, likely will damage a vital sector of the economy to the detriment of consumers.
At the White House, the President, flanked by CFPB Director Chopra and FTC Chair Khan, announces an initiative to crack down on “junk” fees and related pricing practices. In a speech, President Biden promises more rules to regulate prices across the economy. The Consumer Financial Protection Bureau moves to cap a range of fees that that administration termed “junk” fees. The FTC announces its plan to explore a rule on “junk” fees. In response, the U.S. Chamber’s Chief Policy Officer, Neil Bradley points out that, “Consumers and businesses in the free market, not the government, should determine the price of goods and services. … If the Administration continues down this government-knows-best road, the outcome will be fewer choices for consumers and higher prices.”
In a speech at Fordham University, Chair Khan explains her plans to reshape competition law. Among other things, she plans to pursue standalone “unfair methods of competition” cases and to issue policy guidance explaining what that means. She also plans to rely on Supreme Court cases from the 1960s that have largely been discredited in ensuing decades, to reinvigorate the “incipiency” and “conglomerate” theories of competitive harm, and to rework the merger guidelines to eliminate efficiency defenses. In the same vein, Commissioner Bedoya gives a speech decrying efficiency and calling for a renewed focus on the Robinson-Patman Act. The Chamber publishes an article sharply criticizing Chair Khan’s approach to antitrust law.
A report from the FTC’s IG shows that, under Chair Khan, the practice of bringing in unpaid “experts” to work inside the agency without any clear legal authority or guardrails has become prevalent. The report catches the attention of Capitol Hill, with several Senators sending a letter asking for additional information. In addition, the Chamber submits two new FOIA requests to learn who these people are, what are their qualifications, and what have they been working on. This practice is also the subject of our FOIA litigation with the FTC over Lina Khan’s previous tenure as a “fellow” for Commissioner Chopra.
On a 3-2 vote, the FTC issues an Advanced Notice of Proposed Rulemaking regarding “commercial surveillance and data security.” All commissioners issue individual statements, including dissents from Commissioners Wilson and Phillips.
The FTC issues a report to Congress relating to the agency’s enforcement of the Children’s Online Privacy Protection Act Rule (COPPA Rule).
In a sharp concurrence, Commissioner Wilson suggests that Chair Khan is failing to devote adequate resources to children’s privacy. In connection with a complaint about a violation of the “Made in USA” rule, Commissioners Wilson and Phillips issue a dissent that accuses the agency of exceeding its statutory authority.
Commissioner Phillips announces that he will leave the agency in the fall.
Complaining of abuse, Amazon files a petition to limit the agency’s civil investigative demands on current and former employees.
The Chamber sues the FTC for unlawfully withholding public records, specifically:
- FTC’s practice of counting “zombie votes” cast by former commissioners who have already left office as well as specific “zombie votes” cast, regardless of whether they were relied upon in a rulemaking decision.
- FTC’s communications with the European Commission and other foreign jurisdictions regarding the merger of Illumina and Grail. The Commission may have collaborated with and relied upon a foreign government authority to strong-arm American corporations into abandoning a planned merger.
- FTC’s prior employment status granted to Lina Khan while serving as a “legal fellow” under former Commissioner Rohit Chopra. The position of “legal fellow” is highly unusual and not a typical title used in relationship to staff positions in support of a commissioner.
The DOJ and FTC sign a memorandum of understanding with the National Labor Relations Board (NLRB) to facilitate cooperation between especially as it pertains to “…labor market concentration, one-sided contract terms, and labor developments in the ‘gig economy.’” Broadly, this is intended as a way by which to facilitate interagency cooperation in order to execute the administration’s executive order on competition.
The FTC celebrates the one-year anniversary of President Biden’s Executive Order on competition. Chair Khan opines that the order, “recognizes the whole-of-government approach needed to urgently tackle unhealthy concentration and unfair methods of competition across the economy” and commits to expanding interagency collaboration.
The FTC signs a Memorandum of Understanding with the National Labor Relations Board to share information and work together “on key issues such as labor market concentration, one-sided contract terms, and labor developments in the “gig economy.”
The FTC launches a 6(b) study into pharmacy benefit managers. Commissioners Wilson and Phillips issue a statement praising the study’s design. In a separate statement, Commissioner Slaughter writes, “Something is rotten in the state of the U.S. pharmaceutical market, and it warrants serious investigation.”
In a statement, Chair Khan suggests that private-equity firms “focus on short-term profits in the health care context [that] can incentivize practices that may reduce quality of care, increase costs for patients and payors, and generate appalling patient outcomes.” In a separate statement, Commissioners Wilson and Phillips criticize the majority’s “evident distaste for private equity as a business model.”
The Senate confirms Alvaro Bedoya as a commissioner. The FTC now has five confirmed commissioners.
In connection with a consumer protection settlement under the Opioid Addiction Recovery Fraud Prevention Act, Commissioner Wilson blasts the Commission for delaying the settlement for almost eighteen months: “Did it fall victim to the Progressive movement’s habit of second-guessing staff’s excellent work? Was it lost in the shuffle as new leadership prioritized the repeal of longstanding bipartisan policies and planning for a tidal wave of rulemakings?”
At an open meeting, the FTC adopts a new policy statement in which it commits to cracking down on education technology companies that illegally surveil children. In a separate statement, Commissioner Wilson urges the commission to complete its COPPA Rule review instead of “issuing policy statements [that give] the illusion of taking action.”
In a speech referencing potential rulemakings, the Director of the Bureau of Consumer Protection opines that, “I think it’s clear that the notice and choice framework that has guided us for decades is no match for the realities of contemporary surveillance … even if consumers did have a real choice to reject a product or service … in many key digital markets, there just aren’t that many players to choose from – we can’t vote with our feet.”
In a speech to the International Competition Network in Berlin, Chair Khan discusses the importance of a “course-correction” regarding merger review.
Commissioner Wilson gives speech titled, “Marxism and Critical Legal Studies Walk into the FTC: Deconstructing the Worldview of the Neo-Brandeisians.” The speech strongly criticizes the FTC’s current leadership and defends free markets and the traditional approach to antitrust law.
Commissioners Wilson and Phillips criticize the FTC’s budget request, pointing out that the FTC’s productivity has declined under the current leadership.
Surveys from the Office of Personnel Management reveal that morale among FTC staff has plummeted since Chair Khan took over. Among other results, 28.8% of respondents “disagree or strongly disagree” that the agency’s leadership “maintain high standards of honesty and integrity.”
Commissioner Phillips gives a speech entitled, “Disparate Impact: Winners and Losers from the New M&A Policy.” He points out that the FTC’s various delaying tactics regarding merger review ends up hurting smaller companies the most.
Chair Khan gives a speech in which she criticizes the foundations of antitrust law, including the traditional distinction between horizontal and vertical mergers.
The FTC and DOJ announce a series of “Listening Forums” regarding the impact of mergers in several industries, including food and agriculture, health care, media and entertainment, and technology.
In connection with an open meeting, Commissioners split 2-2 on a potential 6(b) study of large pharmacy benefits managers. Chair Khan and Commissioner Wilson discuss the parameters of a potential study. The Director of the Bureau of Economics resigns, apparently in protest over the study’s design.
The Commission issues an Advanced Notice of Proposed Rulemaking to address deceptive earnings claims for business ventures, including gig, educational, and training offerings.
In an interview with CNBC, Chair Khan requests more resources and encourages Congress to tilt the playing field in the FTC’s favor: Congress should “make it easier for enforcers to act quickly, to act in a timely way, to kind of be able to pursue some of the worst violations that we’re seeing, without having to, you know, face the potential of losing significantly.”
Commissioner Wilson delivers remarks to the Mercatus Center. She urges the FTC’s leadership to remain within the bounds of its statutory authority and judicial precedent, budgetary constraints, and bandwidth.
The FTC and DOJ jointly announce a review of the horizontal merger guidelines. Commissioners Wilson and Philips express support for the review but question some of the Commission’s statements, which evince hostility toward mergers generally.
The FTC publishes its semiannual regulatory agenda, in which the Commission commits to exploring rulemakings for competition, as well as consumer protection, because “the case-by-case approach to promoting competition, while necessary, has proved insufficient, leaving behind a hyper-concentrated economy whose harms to American workers, consumers, and small businesses demand new approaches.” In her dissent, Commissioner Wilson writes that the agenda could lead to “an avalanche of problematic rulemakings.” In his dissent, Commissioner Phillips writes that the Commission’s “anti-growth scheme involves regulation after regulation that exceed our legal authority and would recast the FTC as a mini-Congress.”
Representatives McMorris Rodgers and Bilirakis send a letter to Chair Khan asking her about zombie votes, communications with the White House, and numerous other topics.
Senator Mike Lee, the leading Republican on antitrust, gives a speech to the ABA Antirust Section where he called recent action by FTC Chair Lina Kahn “a litany of appalling developments.” He labels the actions as being “lawlessness.”
The Federal Trade Commission and the Department of Justice release a typically non-controversial fact-based report on merger activity in the economy. FTC Commissioner Wilson blasts the politicization of the report stating, “In their statement, Chair Khan and Commissioner Slaughter attempt to use the increase in merger filings as justification for sweeping and detrimental changes imposed on our merger review process. In our statement, attached, Commissioner Phillips and I explain that these recent changes are destroying the merger review framework established by Congress and displacing actual antitrust enforcement.”
The FTC deploys its Penalty Offense Authority to notify more than 1,100 companies that they could incur significant civil penalties if the FTC determines that they made claims about money-making opportunities that run counter to prior FTC administrative orders.
In a press release associated with an October letter signed by several Republican colleagues to the DOJ and FTC, Sen. Lee states, “When Congress gave DOJ and FTC shared merger enforcement powers under the Clayton Act, it never imagined a world in which the two agencies would apply two different legal standards—the very definition of arbitrary and capricious. Sadly, thanks to Chairwoman Khan’s FTC, we live in that world now. It’s time for Congress to fix its century-old mistake and reconsolidate antitrust enforcement at the Department of Justice.”
In the same press release, Rep. Jordan states, “The Biden FTC’s abuse of its power to promote radical leftist goals shows why Congress should not give more authority to this rogue agency.”
Companies can be blacklisted, requiring approval for future merger activity. The FTC announces that it is reversing itself by reinstating an outdated policy allowing the FTC to require certain companies to get approval prior to any future merger. The position is adopted 3-2, with the use of a “zombie” vote with the minority commissioners issuing a strong dissent.
The FTC issues a report to Congress on privacy and security. Chair Khan states that the Commission “should approach data privacy and security protections by considering substantive limits rather than just procedural protections.” The dissenting commissioners contend that the majority improperly conflates privacy and antitrust and threatens to impose remedies for which it lacks statutory authority.
In a letter to the House Judiciary Committee, Chair Khan signals clear intent to use antitrust to address issues outside the bounds of consumer welfare, in this case issues of labor law, related to wages and labor unionization.
The FTC’s Chair is concentrating power. At a House antitrust hearing, Ranking Member Jordan expresses concern about Chair Khan’s “authoritarian” leadership style. In written testimony, a commissioner complains that “procedural irregularities” have precluded robust dialogue within the agency, including the following;
- “Muzzling staff internally and externally
- Stifling the flow of agency records and information from staff to the Commission
- Largely abandoning the tradition of comprehensive staff recommendations discussing legal and economic issues, prudential considerations and
- litigation risks for matters before the Commission
- Giving minimal notice to Commissioners (and the public) of sweeping policy changes
- Giving no written explanations for sweeping policy changes until after those changes are implemented
- Evading meaningful dialogue at the Commission level
- Voting against notice and comment on major policy changes
- Short-circuiting public input by adopting policy statements during ongoing rulemakings that address precisely the topics at issue.”
In a memo laying out her vision for the FTC, Chair Khan announces that the FTC will no longer focus on consumer welfare and would seek to restructure the U.S. economy across many industries.
- Enforcement no longer focuses on consumer welfare: “we need to take a holistic approach to identifying harms, recognizing that antitrust and consumer protection violations harm workers and independent businesses as well as consumers” and “we need to further democratize the agency. This means recognizing the agency as a public body whose work shapes the distribution of power and opportunity across our economy.”
- The FTC wants to restructure the economy: “we need to orient our enforcement efforts around targeting root causes rather than looking at one off effects. This means focusing on structural incentives that enable unlawful conduct—be it certain conflicts of interest, business models, or structural dominance” and “Growing evidence suggests that market power now looks to be an increasingly systemic problem across the economy.”
- The entire economy is a target, not just tech: “we need to be forward-looking in anticipating problems and taking swift action. On both the competition and the consumer protection sides, this means being especially attentive to next-generation technologies, innovations, and nascent industries across sectors."
- European concepts are in vogue: “we should broaden our institutional skillsets to ensure we are fully grasping market realities … technologists, data analysts, financial analysts, and experts from outside disciplines will build on our existing talent … I admire the interdisciplinary approach adopted by some of our international counterparts and am eager for us to learn from their experience and execute on best practices.”
The FTC expands areas in which one commissioner can authorize compulsory process, reducing internal transparency and removing a check against overly aggressive investigations. Adding to its moves of July 1, the FTC approves eight more omnibus resolutions that allow one commissioner to authorize compulsory process: unlawful conduct directed at veterans and service members; unlawful conduct directed at children; bias in algorithms and biometrics; dark patterns and deceptive conduct on the internet; repair restrictions; abuse of intellectual property; common directors and officers and common ownership; and monopolization offenses.
Enforcement no longer focuses on consumer welfare. In merger probes, the FTC is now asking unprecedented questions about topics such as unionization, environmental issues, and corporate governance.
The FTC repeals the 2020 vertical merger guidelines – creating uncertainty and ignoring basic economics. In repealing the guidelines, the FTC sows uncertainty by reverting to guidance that had been discarded by DOJ. Economists sharply criticize the move. A dissenting commissioner protests that, “the FTC leadership continues the disturbing trend of pulling the rug out under from honest businesses and the lawyers who advise them, with no explanation and no sound basis.”
The FTC issues a report on non-HSR reportable acquisitions by technology platforms. For the five largest technology platforms, the report identified 616 non-HSR reportable transactions in excess of $1 million from 2010-2019.
The FTC discards transparency – even internally. An FTC Commissioner is forced to ask private companies for copies of second requests.
The FTC games a challenge to a vertical merger. After dismissing its federal suit, the FTC files an administrative complaint to challenge Illumina’s proposed acquisition of Grail.
The FTC tries to chill merger activity. The FTC announces that it will send pre-consummation warning letters in connection with deals it cannot fully investigate within the HSR timelines. One commissioner protests that the action “defies the will of Congress by undermining the premerger notification program” because “it cannot be that the FTC will keep merger investigations open indefinitely, as a matter of routine, every time there is a surge in filings.”
In a July letter to Chair Kahn, Senator Lee writes, “The unifying theme of these developments is a progressive push to consolidate power and burden American businesses. For the sake of our antitrust enforcement regime, competitive markets, and the American economy, I hope you will change course.”
The FTC announces that it will heighten its review of future mergers. Without public comment, the FTC rescinds a 1995 policy statement on prior notice and approval for future acquisitions. As a result, the FTC will seek to require prior approval of a merging party’s future acquisitions. A dissenting commissioner calls the repeal “bad government and bad policy.” Another commissioner complains that the Chair has limited public meetings to “delivering monologues with no interaction. The format makes these events more akin to theatre than to the reasoned decision making.”
News reports reveal that FTC staff has been “muzzled externally,” as the Chair forbids agency personnel from appearing at any public events. A commissioner notes that, “it appears that staff is being silenced internally, as well.”
The FTC allows one commissioner to authorize compulsory process, reducing internal transparency and removing a check against overly aggressive investigations. A dissenting commissioner expressed concern that “these seven omnibus resolutions remove significant swaths of Commission oversight from our investigations without adequate justification.” Another dissenting commissioner predicts that the changes “would allow the chair, or one commissioner they select, unilaterally to initiate a large number of full-phase investigations across the economy. That means less room for input and oversight from all commissioners and more room for mistakes, overreach, cost overruns, and even politically-motivated decision making.”
At a public meeting announces with just one week’s notice, and without public input, the FTC revises its Section 18 rulemaking procedures to eliminate safeguards and give the Chair more control over the process. Under the revisions, the Chair will select the Presiding Officer for rulemaking hearings and have far more control over the hearing agenda and factfinding process. Commissioner Slaughter in comments during the hearing called for using the new Section 18 procedures to address “data abuses.” The dissenting commissioners, who stress that the FTC’s mission is to protect competition rather than regulate, note that the revisions strike sentences describing the mission of the Bureau of Competition as one that “aims to preserve the free market system.” The dissenting commissioners predict that, “The deletion of this description makes clear the majority’s intention to embark on a sweeping campaign to replace the free market system with its own enlightened views of how companies should operate, and to replace the goals of price competition, quality, and efficiency with subjective and as-yet-unstated goals that are ripe for political manipulation. The revisions thus confirm the suggestion elsewhere that the majority intends to jettison the consumer welfare standard.”
Without public input, the FTC withdraws the statement of enforcement principles regarding “unfair methods of competition” under Section 5 of the FTC Act, removing guardrails and reducing transparency. The dissenting commissioners complain that the withdrawal “[h]int[s] at the prospect of dramatic new liability without any guide regarding what the law permits or proscribes.”
Just ahead of withdrawal by the FTC of its Section 5 UMC Guidance, Senator Lee states, “I am also worried that this is just the beginning of a troubling trend of partisan antitrust enforcement under the Biden administration. This worry was exacerbated when President Biden nominated Ms. Khan to be a commissioner and withheld his intention to immediately name her as Chairwoman. This was undoubtedly an attempt to evade the greater scrutiny and vetting that comes with the confirmation process for the Chair of a Commission, as opposed to an individual commissioner. It is ironic that this kind of deception was used to install leadership at the federal agency tasked with fighting deception and fraud.”
The FTC ignores HSR timelines. In settling a dispute involving 7-Eleven’s purchase of several thousand gas stations, the FTC ignores statutory deadlines, thereby imposing extra costs and uncertainty on the affected companies.
Lina Khan sworn in as chair of the FTC
The FTC and DOJ seek to delay mergers that raise no competitive concerns. The agencies announce a “temporary” suspension of grants of early termination. To date, this temporary suspension has not ended.