Carl W. Hittinger
Carl W. Hittinger ()

On April 28, Terrell McSweeny was sworn in as a Federal Trade Commission commissioner following a 95-1 Senate vote on her confirmation. After 14 months of being one commissioner short (since Chairman Jon Leibowitz left in February 2013), the FTC is now back to full strength on its bench. There is much speculation and interest as to who is McSweeny and what does her appointment mean to the FTC and the business community?

McSweeny’s career history is definitely not that of a typical lawyer. A Senate page at age 16; graduate of Harvard University; a reporter for a small weekly newspaper in West Virginia (and the local NPR station); Georgetown Law School grad; lawyer at O’Melveny & Myers; Vice President Joe Biden’s deputy chief of staff and policy director when he was in the Senate; Biden’s issues director in the 2008 election; deputy assistant to President Obama and domestic policy adviser to Biden on health care, innovation, intellectual property, energy, education, women’s rights, criminal justice and domestic violence; and chief counsel for competition policy and intergovernmental relations at the Antitrust Division of the U.S. Department of Justice.

At the DOJ, McSweeny worked on major antitrust cases, including the e-books price-fixing case against Apple, Bazaarvoice, and the US Airways/American Airlines merger litigation, as well as other price-fixing cases.

But at her Senate confirmation hearing, McSweeny had virtually nothing to say about antitrust. Instead, she concentrated on family values and consumer protection. Indeed, the hearing seemed to be a demonstration of family values, and in turn, featured repeated references to her family. However, in the course of discussing family, McSweeny made it clear that consumer protection in varied forms had been a driving focus of her professional life, and would continue to be at the FTC. She focused on three elements.

First, she spoke forcefully about her commitment to consumer protection against scams and fraud, including deceptive advertising, and the need for active protection of “those that are most targeted by scams or deception in groups such as seniors, veterans, the financially distressed, children.” She emphasized that “focusing on vulnerable groups is incredibly important, and I’d add children to that list as well,” and added that with regard to “fraudsters … we should … as much as possible … prioritize enforcement against them.”

Second, she indicated her deep interest generally in middle-class economic security issues, which specifically include energy costs, and she seemed likely to help expand enforcement of the FTC’s petroleum market manipulation jurisdiction.

Third, she made it clear that she is a strong supporter of privacy protection for all groups, including children, and specifically including teenagers who fall outside the protection of COPPA, or the Children’s Online Privacy Protection Act of 1998. (COPPA requires the consent of the parents only until the child reaches the age of 13.) Asked about industry self-regulation for privacy concerns, she spoke about “frustration,” and supported the FTC’s aggressive policy on privacy enforcement.

Practitioners in this area would doubtless want to know more about McSweeny’s views on enforcement tactics, but that topic was the subject of only minimal questioning. McSweeny was questioned by Senator Roy Blunt, R-Mo., about the FTC’s heightened use of consent decrees, as opposed to rulemaking whose outcome was determined by courts. She diplomatically answered that “the FTC is operating the way Congress designed it.”

Surprisingly, McSweeny was not asked for her views on Section 5 enforcement. But later on in the hearing, she seemed to have voluntarily touched on it in her declaration that the FTC is primarily an enforcement agency. She emphasized that “it’s incumbent on the … enforcers … to make sure that they are clearly articulating their reasoning … and to make sure that they are applying the law as it is written and in following the case law as well, which I think is very, very important. And I commit to doing that and using the authority judiciously and … treating each case really as an individual case looking closely at the evidence before us.”

Although this is not exactly a clear game plan, it could suggest restraint on wide-ranging Section 5 activism. Time will tell.

It is not surprising that, with her eclectic background, McSweeny seemed disposed to inclusiveness and inter-government collaboration in law enforcement, and she repeatedly emphasized her interest in working with federal “sister agencies” as well as state law enforcers.

What does this all mean to business? It means action. First, for the last 14 months, the FTC has been somewhat hampered by the 2-2 “deadlock” among the commissioners on many issues. This meant that, in some cases, the FTC could not authorize a complaint or enforcement action because that requires the vote of a majority of commissioners and they were equally balanced. McSweeny’s appointment ends the procedural “deadlock.” Second, McSweeny joins current Democrats Edith Ramirez and Julie Brill on the commission to form a Democrat majority. Given McSweeney’s stated interests, she may be disposed to side with some of the activist programs of Ramirez. As her career and testified have indicated, McSweeny is an activist, and her stated law enforcement interests suggest aggressive enforcement in at least some areas. Third, as we mentioned earlier, McSweeny’s testimony suggests a reasoned approach to enforcement, and that could more reliance on established antitrust or consumer protection precedents, and less extra judicial use of Section 5 beyond established Sherman Act confines. Stay tuned.

Carl W. Hittinger is a partner and co-chair of DLA Piper’s U.S. antitrust and trade regulation group, where he concentrates his practice in complex trial and appellate litigation, with a particular emphasis on antitrust and unfair competition matters. He can be reached at 215-656-2449 or carl.hittinger@dlapiper.com. Steven Levitsky has a Ph.D. from Johns Hopkins and a law degree from McGill University. He practices antitrust law at the firm in its New York City office and specializes in clearing complex international mergers. He can be reached at steven.levitsky@dlapiper.com.