Friday, November 07, 2008

Barnett Resigns as Justice Department Antitrust Chief

This posting was written by John W. Arden.

Assistant Attorney General Thomas O. Barnett has resigned as the chief of the Justice Department Antitrust Division, effective November 19, 2008.

Barnett was confirmed by the Senate as Assistant Attorney General of the Antitrust Division on Feb. 10, 2006. He became acting Assistant Attorney General on June 25, 2005, and previously served as Deputy Assistant Attorney General since April 18, 2004.

"Tom Barnett has been an effective enforcer of the antitrust laws and a strong advocate for consumers,” said Attorney General Michael B. Mukasey in a statement issued November 7.

“Under his leadership, the Antitrust Division has increased cartel enforcement to record levels with unprecedented fines and prison sentences, improved the efficiency and efficacy of its merger enforcement, and enhanced cooperation with our foreign counterparts."

Antitrust Division Accomplishments

The Division obtained $1.8 billion in criminal fines against 50 corporations and 91 individuals, during Barnett's term. The average prison sentence for incarcerated defendants charged by the Division reached an all-time high of 31 months in Fiscal Year 2007 with an overall average of 23 months during Barnett's 3 ½ years as head of the Division. Foreign executives in international cartel cases also faced longer jail sentences, averaging 12 months in Fiscal Year 2007.

A Department of Justice press release credited Barnett with filing 34 cases in federal district court to either block mergers and acquisitions or require divestitures to eliminate anticompetitive portions of transactions, while permitting consumers to benefit from allowing the remaining portions of the transactions to proceed.

During Barnett’s tenure, the Department (1) filed 14 amicus curiae briefs with the U.S. Supreme Court on competition related issues; (2) brought 16 civil non-merger cases, including some preventing both seller-side and buyer-side monopolization, enforcing compliance with antitrust decrees and procedures, and protecting competition in the market for real estate brokerage services; and (3) pursued 14 investigations resulting in companies abandoning their plans or otherwise changing their practices to eliminate competitive concerns.

Recent Controversy

Barnett was involved in some recent controversy relating to the Antitrust Division’s September 8, 2008 report on Sherman Act Section 2 enforcement. The report (“Competition and Monopoly: Single-Firm Conduct Under Section 2 of the Sherman Act”) discusses whether—and when—specific types of single-firm conduct may violate Section 2 by harming competition and consumer welfare.

The report was attacked in a statement issued September 8 by FTC Commissioners Pamela Jones Harbour, Jon Leibowitz, and J. Thomas Rosch for placing interests of firms with monopoly power or near monopoly power ahead of the interests of consumers and overstating “the level of legal, economic, and academic consensus regarding Section 2.”

Barnett responded by saying that the report reflected a “shared view” of antitrust enforcement among academics, economists, and others and maintaining that the views expressed in the report were “pro-consumer.”

The announcement of Barnett’s resignation appears here. There was no formal indication of his future plans.

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