A Chair With No Legs? Legal Constraints On The Competition Rulemaking Authority of Lina Khan’s FTC

By Jennifer Cascone Fauver

Upon her appointment to the chair position of the Federal Trade Commission (FTC), Lina Khan wasted little time asserting that the Agency possesses the regulatory authority to promulgate rules related to unfair methods of competition. And the President has supported the Chair’s proffered authority requesting that the Agency use that authority to address competition concerns across the U.S. economy. Chair Khan’s interpretation of the FTC act relies on a single case decided by the Supreme Court in 1973—National Petroleum Refiners—and judicial deference under Chevron. However, while simplistic in its logic, Chair Khan’s support for the FTC’s competition rulemaking authority fails under both modern methods of statutory interpretation and on constitutional grounds.

This Article looks at the history of FTC competition rulemaking in the shadow of National Petroleum and reconsiders the FTC’s rulemaking authority under a modern statutory interpretation of the FTC Act. This Article establishes that even after applying the National Petroleum Court’s purposivism approach to statutory interpretation under the Court’s modern precedents, the FTC wields far less rulemaking power, if any. Moreover, the modern Court’s renewed interest in nondelegation, violations of constitutional separation of powers by administrative agencies, and the Court’s resuscitation of the major questions doctrine over the last eight years all suggest that to have competition rulemaking authority, the FTC requires not Chevron deference, but rather a congressional grant of such authority.

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