By Alexei Alexis, Bloomberg BNA
Joseph Simons, President Donald Trump’s nominee to head the Federal Trade Commission, might be more inclined than the agency’s acting chief to pursue enforcement against big firms like Qualcomm Inc., antitrust lawyers told Bloomberg Law.
Simons is most likely to differ from acting FTC Chairman Maureen Ohlhausen in non-merger enforcement, going after companies that unfairly keep out competition through market domination, practitioners said. But he’s not expected to step outside traditional antitrust bounds in doing so, which could frustrate public interest advocates and congressional Democrats who are pushing regulators to expand their use of antitrust law.
The White House on Oct. 19 announced Trump’s intention to nominate Simons, a Republican, to head the agency after months of uncertainty about the outlook for the agency. The FTC currently has only two sitting commissioners on a normally five-member body. The president has also picked Rohit Chopra, a senior fellow at the Consumer Federation of America, to fill a vacant Democratic seat. Chopra was previously an assistant director at the Consumer Financial Protection Bureau. He is Senate Minority Leader Chuck Schumer’s (D-N.Y.) top choice for the spot.
The two nominees are expected to be considered in the Senate as a bipartisan package, which could expedite the process since Democrats will likely be on board.
Trump is also expected to nominate Noah Phillips, an aide to Senate Majority Whip John Cornyn (R-Texas), for the third Republican commissioner slot, according to a White House source.
The timing for that announcement hasn’t been determined. It’s also not known whether Phillips would be part of the Senate’s nomination package with Simons and Chopra.
Simons, an antitrust partner at Paul, Weiss, Rifkind, Wharton & Garrison LLP, oversaw a busy enforcement program as the FTC’s competition bureau chief during the George W. Bush administration, from 2001 to 2003. Among other actions, he spearheaded an anti-monopoly suit against semiconductor manufacturer Rambus Inc.
“I think he’s going to be a tough and demanding boss, not someone who shies away from litigation,” Allen Grunes, an antitrust attorney with the Konkurrenz Group in Washington, told Bloomberg Law.
“Acting Chair Ohlhausen has emphasized the importance of great caution, especially in intellectual property matters,” said Stephen Calkins, an antitrust law professor at Wayne State University and a former general counsel at the FTC, in drawing a contrast to Simons. “Simons is smart and energetic and would want his FTC to be an important agency in the U.S. and globally,” he said.
The Rambus case involved complex intellectual property questions and a cutting edge theory of antitrust liability, according to Alicia Batts, an antitrust partner at Squire Patton Boggs LLP. “I think he won’t be afraid to take on novel issues,” Batts said.
Smartchip maker Qualcomm is currently fighting a lawsuit from the FTC involving similar charges. That case was filed days before President Barack Obama left office, with then-Commissioner Ohlhausen vigorously dissenting. The suit can only be withdrawn by a majority of commissioners, and the two sitting FTC members are deadlocked on the matter. Democrat Terrell McSweeny supports the suit.
It’s unclear whether the situation with Qualcomm’s suit will change if Simons and Chopra are confirmed. Simons wasn’t sympathetic to Rambus’s reasons for its aggressive patent strategies, and the case has already gone through several briefings in court.
Simons has a proven track record in winning the battles he chooses to fight. During Simons’ tenure at the FTC, the agency prevailed in all of the 46 merger enforcement actions that it undertook.
He also initiated more than 100 non-merger investigations in two years and brought new emphasis on administrative litigation.
That led to an uptick in the number of trials before the agency.
His efforts in non-merger actions got a shout-out from the White House in the nomination statement, noting that Simons was responsible for overseeing the “re-invigoration” of the FTC’s non-merger enforcement program.
Simons may be more aggressive about suing companies for anticompetitive behavior, but he has a reputation for proceeding more cautiously in challenging mergers. He’s known for promoting “critical loss analysis,” an economically sophisticated approach that often benefits merging parties, Calkins said.
Calkins predicted that any changes from Ohlhausen under Simons’ leadership would be subtle. “Both are smart, competent, experienced antitrust lawyers,” he said. “Both care about the agency.”
—with assistance from Fawn Johnson