Interview Jon LEIBOWITZ
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Concurrences Revue des droits de la concurrence Jon LEIBOWITZ: Priorities and challenges for the US Federal Trade Commission Interview l Concurrences N° 1-2010 www.concurrences.com Jon LEIBOWITZ l Chairman of the US Federal Trade Commission Interview Jon LEIBOWITZ Chairman of the US Federal Trade Commission Jon LEIBOWITZ: Priorities and d'amende challenges for the US Federal € Trade Commission You were appointed Chairman of the FTC by President Obama on March 2, 2009. Since 2004 you served as Commissioner under the Bush administration. What major changes in antitrust enforcement have you seen between the two administrations so far? 2009 There is always more continuity than change in a shift of administrations. A broad consensus view governs most antitrust situations. This is particularly true of a multi- Chairman of the US Federal member, bipartisan agency like the FTC, which is structurally resistant to quick Trade Commission changes of direction. All that said, however, I have noticed three signi!cant areas of change.1 2004 First, there is a change in the way the U.S. agencies are approaching the inevitable problems of risk and uncertainty. Under the last administration there was a sense Commissioner at the US FTC that the most important task was to avoid the risk of overenforcement that might chill ef!cient business conduct. Today, however, I think we have more of a sense that we need strike more of a balance. We still want to avoid the problems of uncertainty, 2000-2004 inef!ciency and overenforcement on the one hand, but we also want to minimize document this of use Non-authorised treaties. copyright international and laws copyright by protected is document his Vice-President for Congressional the risks of underenforcement and market power on the other. It is not enough to maximize ef!ciency. We also have to think about whether the bene!ts of that A!airs for the Motion Picture ef!ciency will be passed on to consumers. Association of America The evolving approach to this issue is illustrated by the history of the Section 2 Report. When the Justice Department under the last administration issued that report, it 1997-2000 placed great weight on avoiding overenforcement. For example, it suggested that Democratic Chief Counsel and loyalty discounts would probably be acceptable as long as they were legal under the Sta! Director for the US Senate bright-line test for predatory pricing, with little regard for circumstances or actual market effects. Not a single member of the FTC joined in the report, however, and Antitrust Subcommittee three of us criticized it.2 Today the two agencies are much closer in their assessment of substantive issues and risks. This is illustrated by the new administration’s decision to withdraw the Section 2 Report. 1989-2000 300 000 fine (Art. L. 335-2 Code de la Propriété Intellectuelle). Personal use of this document is authorised within the limits of Art. L 122-5 Code de la Propriété Intellectuelle and DRM protection. DRM and Intellectuelle Propriété la de Code 122-5 Art.L of limits the within authorised is document this of use Personal Intellectuelle). Propriété la de Code 335-2 (Art.L. fine 000 300 Chief Counsel to Senator € Herb Kohl “Today the two [US] agencies are much closer in their assessment of substantive issues and risks” 1984-1986 A second area of change involves Section 5 of the FTC Act. Section 5’s ban on Attorney in private practice “unfair methods of competition” was given limited scope in recent years, and was in Washington used primarily for !lling in technical gaps in the antitrust statutes. Now, however, the Commission has used it to challenge potentially more substantial conduct in economically more important markets, in ways not necessarily reached by the 1984 Sherman Act. New York University School A third area includes pay-for-delay settlements. In 2005, the 11th Circuit reversed of Law a Commission opinion !nding a patent settlement anticompetitive. The Antitrust Division of the Department of Justice and the Solicitor General opposed the FTC’s request for Supreme Court review. Under the Obama administration, the Solicitor General and the Antitrust Division !led an amicus brief largely agreeing that these anticompetitive patent settlements must be stopped. 1 These are discussed at more length in my “Remarks to the 36th Annual Conference on International Antitrust Law and Policy,” Fordham Law School (Sept. 24, 2009), available at http://www.ftc.gov/speeches/leibowitz/090924fordhamspeech.pdf. 335-2 CPI). L’utilisation personnelle est strictement autorisée dans les limites de l’article L. 122 5 CPI et des mesures techniques de protection pouvant accompagner ce document. T document. ce accompagner pouvant protection de techniques mesures des et CPI 5 122 L. l’article de limites les dans autorisée strictement est personnelle L’utilisation CPI). 335-2 This interview has been conducted by Stéphanie L. Yon, Adviser for International A!airs in the O"ce of 2 Press release, FTC Commissioners React to Department of Justice Report “Competition and Monopoly: Single-Firm Conduct the President of the Autorité de la concurrence, Paris. under Section 2 of the Sherman Act” (Sept. 8, 2008), available at http://www.ftc.gov/opa/2008/09/section2.shtm. Ce document est protégé au titre du droit d'auteur par les conventions internationales en vigueur et le Code (art. de la propriété intellectuelle du 1er juillet 1992. utilisation Toute non autorisée constitue a to une up and imprisonment years contrefaçon, 3 to délit up by punished be pénalement may and rights sanctionné publisher's the of violation jusqu'à a constitutes 3 ans d'emprisonnement et 300 000 Concurrences N° 1-2010 I Interview I Jon LEIBOWITZ: Priorities and challenges for the US Federal Trade Commission 1 The end of the year 2009 brought good news for the year 2009 the Commission authorized seven merger actions, functioning of the FTC. First, Julie Brill and Edith Ramirez either injunction !lings in federal court or administrative were nominated by President Obama to be new members of d'amende !lings, which is a record number for a single year. € the Commission, and important senior staff positions were !lled. Second, the agency is said to have received a $33 As a matter of day-to-day case selection, however, the present million increase in its budget for 2010. Have these actions been approved by the Senate yet? How do you expect the downturn has made consumers vulnerable to new kinds of budget increase to be allocated? abuses. So, within the framework of a stable general policy, we have adjusted our speci!c programs to address those new 2009 has turned out to be an important year for us. The problem areas. new management of the agency has now been in of!ce long enough for its own projects to move through the pipeline and Rising unemployment, shrinking credit, record-setting begin to produce practical effects. The Section 5 elements in foreclosures, and disappearing retirement accounts are the Intel complaint are just one example of this. I expect you causing consumers tremendous anxiety about making ends will see more initiatives in the future. meet. To con artists, today’s challenging economy presents another opportunity to play on consumers’ worries and bilk Our ability to take wise and effective action is going to be them out of money. Their new scams increasingly promise enhanced by the addition of talented new people to the job placement, access to free government grant money, or the agency. If con!rmed, the two Commissioner nominees chance to work-at-home. They promise to help consumers named by President Obama will bring valuable new modify their home mortgages to make them more affordable, perspectives and experiences to the Commission, which is but they deliver nothing. They raise people’s hopes and one of the great strengths of a multi-member agency. That then drive them deeper into a hole. The FTC has acted said, when the new Commissioners arrive, Commissioner aggressively to stop these scams, through coordinated law Pamela Jones Harbour will conclude her term. She has enforcement actions with our state and federal partners and contributed to many important matters, especially including through extensive consumer education. document this of use Non-authorised treaties. copyright international and laws copyright by protected is document his privacy initiatives, and she will be sorely missed. The Senate Commerce Committee held hearings on both nominees on December 15, and has approved them unanimously, although the full Senate has not yet voted on them. “The present downturn has made consumers vulnerable to new We also have some outstanding new people to run the major kinds of abuses” staff of!ces of the agency – Joe Farrell and Howard Shelanski in the Bureau of Economics; Rich Feinstein, Pete Levitas, and Norm Armstrong in the Bureau of Competition; and For example, in July, the FTC announced “Operation Short David Vladeck, Jessica Rich and Chuck Harwood in the Change,” a law enforcement sweep that included 15 FTC Bureau of Consumer Protection. Our new General Counsel cases, 44 law enforcement actions by the Department of is Will Tom. Finally, heading our Of!ce of Policy Planning Justice, and actions by at least 13 states and the District of is Susan DeSanti. Of course, it’s an honor and a privilege to Columbia. These cases targeted scammers trying to take work with the entire FTC team, which is a fantastic group of advantage of the economic downturn through a variety of dedicated, passionate individuals. schemes, such as promises of non-existent jobs; promotions protection. DRM and Intellectuelle Propriété la de Code 122-5 Art.L of limits the within authorised is document this of use Personal Intellectuelle).