Wednesday, March 11, 2009

Nominee Varney Describes Focus as Antitrust Chief

This posting was written by John W. Arden.

In a statement delivered in a confirmation hearing before the Senate Judiciary Committee on March 10, Christine Varney, nominee as Assistant Attorney General in charge of the Antitrust Division, described her focus and qualifications for the job.

“Strong antitrust enforcement and respect for our competition statutes are the primary safeguards of our distinctive free enterprise system,” said Varney, a Washington lawyer who served as Federal Trade Commissioner during the Clinton Administration. She set out three main areas on which she would focus if confirmed.

Areas of Focus

“First, we must rebalance legal and economic theories in antitrust analysis and enforcement,” she said. “The Antitrust Division can provide strong intellectual leadership in competition policy by advancing our collective understanding of competitive behavior and adapting our thinking to reflect our ever evolving markets.”

“Second, we need renewed collaboration between the Antitrust Division and the FTC, whose policies and processes have unfortunately diverged too frequently in recent years,” Varney observed. Such divergence and conflicts lead to uncertainty for consumers, businesses, and overseas antitrust enforcers.

“Third, we must continue our cooperation with worldwide antitrust authorities, discussing our differences with international enforcers respectfully and engaging with emerging antitrust regimes, such as China and India as they implement new antitrust laws.”

Antitrust Enforcement During Economic Crisis

Varney addressed the question of whether antitrust enforcement should be pursued in the current economic crisis. “I believe it is important to remember that robust antitrust enforcement is essential for the free market to function properly,” she said.

“In these tough economic times, more than ever, it is important to remember that clear and consistent antitrust enforcement—protecting competition and thus consumers while being conscious of the need for economic stability—is essential to a growing and healthy free market economy.”

The nominee expressed confidence that she is “well equipped” to meet the challenges of the position of chief antitrust enforcer. “I will approach the challenged we face from my unique vantage point as a former FTC Commissioner, which I believe will help me to bridge the gap that exists between the antitrust agencies on several crucial substantive and procedural issues.”

Varney’s written testimony appears here.

Merger Enforcement

The statement was followed by questions from the members of the Judiciary Committee, according to a posting to an ABA antitrust listserv by David Balto. Senator Herb Kohl (D-Wis.) asked Varney for her assessment of the "sharp cutback" in merger enforcement and enforcement against dominant firms during the Bush Administration. The nominee decline to discuss particular cases, but said she would enforce the law vigorously and stop horizontal mergers that cuase competitive harm.

Resale Price Maintenance

When asked about her view of the Supreme Court's decision in Leegin Creative Leather Products, Inc. v. PSKS, Inc., Varney said she was surprised by the decision but believed that the law allowed the Department of Justice room to prosecute resale price maintenance. If not, she might support further legislation on the issue.

DOJ Monopoly Report

Senator Russ Feingold (D-Wis.) asked if Varney would review and potentially repudiate the Department of Justice's September 2008 report on single firm monopoly conduct ("Competition and Monopoly: Single-Firm Conduct Under Section 2 of the Sherman Act”). The nominee responded that she would review the report and that she felt that the conclusions the report drew were not appropriate. She said she would work with te Division staff and the FTC to determine if the report should be revised or some other action taken.

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