New FTC rules unlikely with limited funds, policy shifts
Amid resource limitations and changes at the federal level, the FTC will be cautious in its approach to bringing cases and making other significant changes.
The Federal Trade Commission is undergoing a slow but steady transition as it moves away from Biden-era leadership on agency rules and antitrust cases. At the same time, it faces significant resource limitations and deregulatory initiatives under President Donald Trump.
The U.S. Department of Government Efficiency has initiated massive funding and agency cuts across the federal government, meaning agencies like the FTC will be forced to work with its already limited funding for staffing, case development and litigation, said Maureen Ohlhausen, a partner in antitrust and competition at law firm Wilson Sonsini and a former FTC commissioner. Ohlhausen spoke during a webinar about antitrust under the Trump administration hosted by the Information Technology and Innovation Foundation (ITIF).
"With the focus on trimming back government, it's not likely the FTC will get much of a plus up on any sort of resources, and it's under pressure to do cutbacks," Ohlhausen said during the webinar. "The chair really needs to pick his battles."
Ohlhausen said the FTC's need to be selective will likely translate to Chair Andrew Ferguson devoting fewer resources to agency rulemaking. FTC rules like the noncompete ban introduced under former FTC Chair Lina Khan face legal challenges and an uncertain future with the Trump administration.
Ferguson will also be cautiously assessing which rules and policies introduced under Khan's FTC to keep or toss, Ohlhausen said. Ferguson, a Republican, does not currently have a majority hold on the five-member commission, which comprises two Democrats and one Republican. Presidential nominee Mark Meador, a Republican, has yet to be confirmed by the Senate.
Ohlhausen said Ferguson has limited power to change FTC policy statements, rules or cases the agency is pursuing until he has a majority.
"You cannot undo things that were done by the previous administration that require a vote without a new vote and a majority," she said.
Future of the FTC
Once Ferguson secures a commission majority, Ohlhausen said it will shift which cases the FTC picks to pursue. However, she added that she doesn't expect it to affect existing FTC cases against companies like Amazon and Meta.
Some of the big tech cases that were brought at the end of the previous Trump administration and during the Biden administration will likely continue forward.
Maureen OhlhausenPartner, Wilson Sonsini
"Some of the big tech cases that were brought at the end of the previous Trump administration and during the Biden administration will likely continue forward," she said.
Remedy proposals in antitrust cases will likely change under Ferguson and Gail Slater, who heads the U.S. Department of Justice's antitrust division. While the DOJ under Biden proposed breaking up Google in its antitrust search case against the company, for example, Ohlhausen said she expects both the FTC and DOJ to favor other measures, including settlements.
The FTC might also eventually face structural changes should the One Agency Act introduced by Rep. Ben Cline (R-Va.) in 2024 advance. The bill proposes to transfer antitrust enforcement from the FTC to the DOJ.
Censorship litigation a challenge for FTC
Some of Ferguson's efforts at the FTC so far include implementing 2023 joint merger guidelines crafted by the FTC and DOJ, creating a Joint Labor Task Force to investigate anticompetitive conduct and launching a public inquiry on big tech censorship.
Finding relevant antitrust theories of harm to bring and litigate a censorship case against big tech companies will be a massive challenge for Ferguson and the FTC, said Alden Abbott, a senior research fellow at the George Mason University Mercatus Center and former general counsel for the FTC. Abbott spoke on the ITIF webinar with Ohlhausen.
Abbott said funding constraints will significantly affect the FTC's ability to bring additional cases against well-funded big tech companies beyond those already filed.
"The FTC will have limited resources, and I think there will be a lot of concern about using those resources," he said.
William Blumenthal, an antitrust lawyer, former general counsel for the FTC and a speaker during the ITIF webinar, echoed Abbott's concerns that the FTC might be fighting an unwinnable battle when it comes to lodging censorship complaints against big tech companies.
"In antitrust theory, going after big tech censorship is -- I don't want to say it's a non-starter, but man is it tough," he said.
Makenzie Holland is a senior news writer covering big tech and federal regulation. Prior to joining Informa TechTarget, she was a general assignment reporter for the Wilmington StarNews and a crime and education reporter at the Wabash Plain Dealer.
