One of the consistently thorny issues in U.S. antitrust law is the rather vague boundary of Section 5 of the FTC Act, which concerns non-merger conduct that may not violate the Sherman Act but still constitutes harmful anticompetitive conduct. Recently, Commissioner Joshua Wright, followed by Commissioner Maureen Ohlhausen, issued calls for guidelines that would direct the Commission in its use of Section 5. We have assembled a blue-ribbon panel of contributors to opine on the need for such guidelines as well as the recommendations contained in Commissioner Wright’s statement, (see Proposed Policy Statement Regarding Unfair Methods of Competition Under Section 5 of the Federal Trade Commission Act).
We are definitely not yet at consensus.
Section 5 Guidelines – Love or Leave ?
By articulating principles that delimit how far the FTC can go under Section 5, the FTC would provide courts assurances that meaningful judicial review can still occur. Daniel Crane (University of Michigan)
But before we abandon S&H (along with other Supreme Court cases that at least pay some attention to what Congress intended when enacting the antitrust laws) for the embrace of the latest updated thinking from today’s economists, it might be helpful to take another look at the S&H case itself. Harry First (New York Univ. School of Law)
The vagueness of Section 5 also creates a specter of law enforcement activity driven largely by the unpredictable whim of whatever majority of Commissioners happens to exist at any particular time. A. Douglas Melamed (Intel Corp.)
A reliance on existing guidance is certainly defensible in that a significant, albeit small, group of court decisions already provide appropriate contours for Section 5’s interpretation. Sharis Pozen & Anne Six (Skadden)
Neither Section 1 nor Section 2 is sufficient to prohibit or deter a range of conduct that leads to consumer harm from the achievement and exercise of market power. Steven Salop (Georgetown Univ. Law Center)
The real value of guidelines is that they put some public, visible constraints on what is otherwise just a hope and prayer that the FTC majority will not overreach. Joe Sims (Jones Day)
A Response To Commissioner Wright’s Proposed Policy Statement Regarding Unfair Methods Of Competition
It is hard to see how the proposed legal standard fulfills Congress’s intent to reach beyond the Sherman and Clayton Acts and prohibit incipient violations of those statutes, and conduct which, although not a violation of the letter of the antitrust laws, is close to a violation or is contrary to their spirit.” Maurice Stucke (Univ. of Tenn. College of Law)