Obama Administration Promises "Vigorous Antitrust

Enforcement in this Challenging Era"

As a candidate, President Obama promised to reinvigorate antitrust enforcement, stating that "antitrust is the American way to make capitalism work for consumers." As president, his choices for the leaders of the antitrust enforcement agencies, Jon Leibowitz as chairman of the Federal Trade Commission (FTC) and Christine Varney as assistant attorney general for Antitrust at the Department of Justice (DOJ), indicate the administration intends to deliver on that promise.

Leibowitz joined the FTC as a commissioner in 2004, became chairman on March 2, 2009 and brings a reputation for aggressive enforcement of the antitrust laws. In recent speeches, he stated that the FTC will continue to oppose "pay for delay" settlements, oppose anticompetitive agreements among healthcare providers, monitor mergers that raise healthcare costs, and take steps to ensure that competition works in innovation markets. Recently, the FTC adopted rules expediting administrative proceedings, which the FTC suggests will increase its ability to successfully pursue enforcement actions. Leibowitz also expressed a desire to broaden the types of conduct subject to enforcement actions by using the FTC's authority to regulate "unfair methods of competition," to seek disgorgement remedies and to expedite the FTC's process for adopting regulations.

Varney, a former FTC commissioner during the Clinton administration, also brings a reputation for taking an aggressive stance toward antitrust enforcement. In her confirmation hearing, she stated that the DOJ, "must change course and take a new tack." In addition to continuing to vigorously pursue cartels, she has made it clear that the current economic crisis does not justify lax antitrust enforcement and that she intends to increase enforcement by cracking down on violations of single-firm conduct laws, pursuing merger and non-merger investigations and exploring other new areas for civil enforcement. Among her first acts was to disavow the DOJ's policy statement on single firm conduct on the basis that it promoted, "an overly lenient approach to enforcement."

The implications of Obama's policies and his selections for the leaders of the antitrust enforcement agencies include:

· Continued aggressive pursuit of cartels;

· Fewer policy differences between the DOJ and FTC;

· Increased review of single firm conduct, such as exclusive dealing, tying and bundling;

· Increased scrutiny and potentially increased challenges of mergers, including vertical mergers;

· Development of new methods for the FTC to increase its success rate and new theories to pursue enforcement; and

· Particular interest in the areas of healthcare, energy, technology and consumer protection.

All businesses, particularly those with high market shares, should be aware of these changes, review policies and practices in light of the likelihood of aggressive enforcement and consider adoption of an antitrust compliance policy. In addition, businesses faced with the potential acquisition of a supplier or competitor that will negatively impact the business can consider the cost-effective means of opposing the potential acquisition by complaining to an agency. For further information, please contact Anthony Aaron or Jill Koehlinger.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice.  The reader must consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.