Since the appointment of Chairwoman Khan to the FTC this past summer, the three Democratic commissioners have pushed through 15 omnibus resolutions authorizing staff to use compulsory processes without additional approval from the Commission. Although the use of blanket authorizations is old hat at the FTC, the practice remains controversial because it allows staff to issue civil investigative demands (CIDs) and subpoenas to companies and individuals without consulting with the Commission, as long as the investigation ostensibly relates to an existing omnibus resolution and one commissioner signs off. This gives staff extraordinary latitude and discretion, especially considering the sweeping nature of the resolutions.
Yesterday, the Commission announced eight such resolutions, covering broad swaths of the FTC’s consumer protection and antitrust jurisdiction—and the U.S. economy. They are:
- Acts or Practices Affecting United States Armed Forces Service Members and Veterans;
- Acts or Practices Affecting Children;
- Bias in Algorithms and Biometrics;
- Deceptive and Manipulative Conduct on the Internet;
- Repair Restrictions;
- Abuse of Intellectual Property;
- Common Directors and Officers and Common Ownership; and
- Monopolization Offenses.
In July, the Commission (by a 3-2 vote) authorized seven blanket resolutions, covering, among other things, COVID-19, healthcare markets, small business operators, and technology platforms.
Under the resolutions, staff can use “any and all compulsory processes available . . . in connection with any inquiry within the nature and scope of this resolution.” The resolutions expire in 2031.
Commissioners Khan and Slaughter described their vote as removing bureaucratic hurdles that slow down the agency staff’s ability to expeditiously investigate potentially unlawful conduct. They also defended it on the grounds that it will save scarce resources at a time when FTC funding is down, the staff head count is two-thirds what it was at the beginning of the Reagan administration, and merger filings are set to break records.
As expected, Commissioners Phillips and Wilson issued a dissent, sounding the alarm that this Commission has “discarded a number of longstanding, bipartisan (and sound) policies and practices.” They argued that relying on omnibus resolutions removes congressionally mandated Commission oversight over investigations.
Tensions between the Democratic and Republican appointees are high. The two Republican commissioners, Noah Phillips and Christine Wilson, have made multiple statements charging their colleagues with shutting them out of Commission business. Just two weeks ago, Commissioner Wilson sent a letter to a company under review by the FTC, asking the company to provide her with a copy of the FTC’s request to the company because she was unable to obtain a copy internally.
Of course, the use of omnibus resolutions does nothing to address the Commission’s limited resources problem. But it consolidates the allocation of those resources in the chair’s office. As Commissioner Wilson noted, it allows “unilateral approval from the chair or his or her chosen commissioner.” It’s hard to imagine an area of inquiry within the FTC’s jurisdiction that does not fit within one of the 15 blanket resolutions. In other words, the Republican commissioners are now shut out of deciding who to investigate.
More change is coming to the FTC. On Monday, President Biden nominated Georgetown Law Professor Alvaro Bedoya, an online privacy expert, to replace Commissioner Chopra, who has been tapped to lead the Consumer Financial Protection Bureau. Professor Bedoya has written extensively regarding the use of surveillance technology, including facial recognition, and has expressed concerns that such technology may be used to discriminate on the basis of race. Expect further FTC action on this front if Bedoya is confirmed.