On June 15, 2021, President Biden named Lina M. Kahn chair of the Federal Trade Commission (FTC) after her Senate approval. The appointment is celebrated by those who are calling for more aggressive antitrust enforcement – especially large digital platform companies – and those who prefer an antitrust approach that goes beyond the focus of consumer protection. While the appointment of Chair Kahn could result in more aggressive enforcement of mergers and non-mergers, it remains to be seen whether she will attempt to implement some of her bolder ideas and how the courts and parties under investigation might react.
Chairwoman Kahn became known in antitrust circles in 2017 after she published a legal article she wrote while studying law at Yale. The article advocated, among other things, a move away from the consumer welfare standard that has underpinned modern antitrust law.1 In particular, progressive democrats have pushed the article – which focuses on large digital platform companies – as part of an urge to rule the “big tech” and the most important To make changes to the antitrust laws for years. 2
After her time at Yale, Kahn worked as Legal Director for the Open Markets Institute before moving to academic positions at Columbia Law School. She also served as Counsel to the U.S. House Committee on Justice, Subcommittee on Antitrust, Commercial and Administrative Law, where she helped prepare a 2020 report on competition in digital markets
In addition to challenging the antitrust approach to consumer welfare, Chairman Kahn has also advocated forcing mergers, rather than divestments and conduct conditions, to address competition concerns, 4 for remedial action against structural segregation (such as divestments, sales of assets and restrictions on entry in certain business areas) on conduct aids, 5 for the FTC to establish rules for communications and comments defining “unfair competitive practices” under Section 5 of the Federal Trade Commission Act6 for the potential application of common operator rules to large technology platforms7 and has the Supreme Court decision in Ohio criticized American Express Co. for improperly creating a special rule of antitrust analysis for “two-sided” markets
Confirmation audible signals
A notable issue in Khan’s affirmation was concern that the FTC lacked the technical know-how and authority to keep up with the ever-evolving marketplaces. In her Senate questionnaire, for example, Kahn identified the lack of sophisticated analytical or empirical tools as one of the greatest challenges facing the FTC.9 In her hearing, she came across a similar thread when she identified “deep information asymmetries” between enforcement agencies and corporations as one Main obstacle to effective enforcement and commenting that regulators and enforcement agencies “understand the underlying business realities and the empirical realities such as these [digital platform] Markets work[.]”
Outside the antitrust arena, when urged by senators about the FTC’s role in overseeing content moderation through social media platforms, Khan stated that it supports the use of the FTC’s information-gathering authorities as a means of gaining greater transparency in content moderation decisions.
What that means for you
Chairman Kahn’s confirmation gives Democrats a 3-2 majority until current FTC commissioner Rohit Chopra is confirmed as head of the Consumer Financial Protection Bureau (“CFPB”). President Biden has not nominated Commissioner Chopra’s successor, so his confirmation to the CFPB will lead the FTC back to a 2-2 split. In particular, President Biden has not yet nominated anyone to head the Justice Department’s antitrust division.
While her academic writing provides some clues, Chair Khan’s enforcement priorities are still largely unknown. Technology companies are clearly in Khan’s spotlight, but their previous criticism of many of these companies may require the cancellation of matters affecting those companies. In addition, some of Chairman Kahn’s bolder ideas could face opposition – from other commissioners, FTC professionals, and the courts. Still, before the FTC, companies should expect more scrutiny of proposed mergers, more rigorous review of proposed remedial actions, and longer merger reviews.
1 Lina M. Khan, Antitrust Paradox from Amazon, 126 Yale LJ 710 (2017).
2 See, for example, the Competition and Antitrust Reform Act introduced in February by Senator Amy Klobuchar. Pp. 225, 117. Kong. (2021).
3 hours. Come via the judiciary, accommodation. on Antitrust, Commercial and Administrative Law, 116th Cong., Investigation of Competition in Digital Markets: Majority Staff Rep. and Recommendations (2020).
4 Lina Khan, How to reboot the FTC, Politico: The Agenda (April 13, 2016), https://www.politico.com/agenda/story/2016/04/ftc-antitrust-economy-monopolies-000090/.
5 Lina M. Khan, The Separation of Platforms and Commerce, 119 column. L. Rev. 973 (2019).
6 Rohit Chopra & Lina M. Khan, The Case for “Unfair Methods of Competition” Rulemaking, 87 U. Chi. L. Rev. 357 (2020).
7 Kahn, see footnote 1, pp. 797–800.
8 Lina Khan, America has a big market power problem & SCOTUS just made it worse, beware (July 5, 2018), https://takecareblog.com/blog/america-has-a-major-market-power- problem- and-scotus-just-it-worse.
9 Khan has also cited the FTC’s recently reduced criminal powers under Section 13 (b) as one of the main challenges facing the agency. See Darren Tucker, Ryan Will and Mike Matthews, Unanimous Supreme Court Restricts FTC’s Ability to Seek Financial Remedies, The V&E Report (April 29, 2021), https://www.velaw.com/insights/unanimous-supreme -court- limited-ftcs-ability-to-seek-monetary-remedies /.
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