The Acting Chairwoman of the Federal Trade Commission (FTC),[1] Maureen Ohlhausen has worked in private FTC litigation, held a variety of posts at the FTC, and worked as a staff attorney and clerk in D.C.’s federal appeals court and the U.S. Court of Federal Claims.  She now is a nominee to that very court.

Background 

Ohlhausen graduated from the University of Virginia in 1984 with a B.A. in English, with distinction, and earned her J.D., with distinction, from the George Mason University School of Law in 1991.[2]  Upon graduating from law school, she clerked for the U.S. Court of Federal Claims, after which she clerked for Judge David B. Sentelle of the U.S. Court of Appeals for the D.C. Circuit from 1994-1997.  Following her clerkships, she began a 12-year stint at the FTC, where she started as an attorney in the Office of the General Counsel and ultimately became Director of the Office of Policy Planning.[3]  In 2009, she was policy counsel at the Business Software Alliance, a private firm specializing in the software industry private firms centering on software and technology, and from late 2009-2012, she practiced law at FTC practice group, Wilkinson Barker Knauer, LLP, where she was a partner.[4]  Ohlhausen has served as an FTC commissioner since 2012, and President Trump designated her as the FTC’s acting chairwoman in 2017.[5]

History of the seat

President Trump has nominated Ohlhausen to sit as a judge on the U.S. Court of Federal Claims, a court of special jurisdiction that hears monetary claims against the U.S. government.[6]  Judges on the court serve for 15-year terms and are eligible for reappointment.[7]  The seat Ohlhausen was nominated for opened up on January 8, 2016, with Judge Lawrence Block’s move to senior status.  While five Obama nominees to the CFC were approved by the Senate Judiciary Committee unanimously on February 26, 2015, the nominations were blocked by Sen. Tom Cotton (R-AR), who argued that the CFC did not need any more judges.[8]  No nominee was ever put forward for the Block seat.[9]

Legal Career & Views

Ohlhausen is a Republican and an outspoken critic of government regulation.[10]  A believer in free markets, Ohlhausen has frequently used the term “‘regulatory humility’ to describe her philosophy on federal policymaking.”[11]  She has also advocated deregulation of and limited governmental intervention in the marketplace, a philosophy she put into practice in nominating fellow prominent deregulation advocate Thomas Pahl to the FTC’s Bureau of Consumer Protection last year.[12]

For example, she opposes broad occupational licensure requirements (i.e., the governmental requirement of a license to pursue a particular profession or vocation).[13]  Indeed, as her “first major initiative as Acting Chairman, [Ohlhausen] formed the Economic Liberty Task Force to help” prevent or roll back “unnecessary or overbroad occupational licensing and to partner with state leaders and other stakeholders.”[14]  See also infra, “Speeches and Writings” for an expanded discussion of Ohlhausen’s views on this issue.

More controversially, Ohlhausen is an outspoken opponent of net neutrality laws, and instead believes that its ends can be achieved via antitrust enforcement.[15]  Under the Federal Communications Commission’s (FCC) 2015 net neutrality regulations, Internet service providers’ (ISPs) were prohibited from blocking or throttling internet traffic, and from charging websites and online services for faster, more reliable services.[16]  In late 2017, shortly before the FCC’s repeal of net neutrality and during Ohlhausen’s tenure as FTC chairwoman, the FCC and FTC entered into a memorandum of understanding whereby ISPs may promise consumers that they will follow net neutrality guidelines.  If they break this promise, the FTC has jurisdiction to punish them for deceiving consumers.  The FTC’s jurisdiction thus depends on ISPs voluntarily making, and then breaking, net neutrality promises to consumers.[17]  Opining on the memorandum, Ohlhausen reiterated the FTC’s “committ[ment] to ensuring that Internet service providers live up to the promises they make to consumers.”[18]

Speeches and Writings

By virtue of her position as acting chairwoman, Ohlhausen has publicly taken a number of positions regarding market entry, market deregulation, and the effects of regulation in terms of fairness to consumers.  The following samples some of her more recent speeches and writings.

Ohlhausen authored a 2016 journal article, Administrative Litigation at the FTC: Effective Tool for Developing the Law or Rubber Stamp?[19]  The article is the most comprehensive empirical study of the FTC’s “Part 3 process,” an administrative process that empowers the FTC to challenge alleged unfair or deceptive trade practices through administrative litigation.  If the FTC invokes this process and the respondent challenges the charges against it, the case is tried before an Administrative Law Judge, and then the FTC reviews the judge’s decision de novo.  In the past ten years, the FTC has never rejected an action that it previously authorized.  By analyzing the disposition of cases that go through the Part 3 process and the factors at play in the FTC’s charging decisions and subsequent affirmance, the article challenges Part 3 critics’ contention that the FTC’s review of its own charging decision is essentially a rubber stamp, concluding that the Part 3 process plays a crucial role in developing the law.

In May of 2017, Ohlhausen delivered a speech at a seminar covering the first 100 days of the Trump administration.  She explained three of the Trump administration’s priorities pertaining to the FTC: unleash job creation, correct federal government overreach in a number of areas, and reform federal regulatory processes and reduce burdensome regulation.[20]  She praised these efforts as aligning with the FTC’s efforts “to expand and strengthen our competition advocacy work,” “ prevent meaningful consumer harm, not [] redesign the economy as we see fit,” and “eliminate unnecessary and burdensome regulatory requirements that hurt our economy.”[21]

In July of 2017, Ohlhausen was the keynote speaker at an event hosted by The Heritage Foundation, a conservative think tank, where the topic was the promotion of regulatory reform for occupational licensing requirements.  During the speech, Ohlhausen argued that unnecessary occupational licensure requirements are “barriers to entry” that “harm[] workers, consumers, and the economy as a whole.”[22]  Unnecessary licensing requirements, she explained, are those where there are not information asymmetries between professionals and consumers, in non-technical fields, and those where consumers can “easily observe service quality.”[23]  For example, “in certain health care occupations, consumers could face serious risks if treated by unqualified individuals, yet find it difficult (or impossible) to assess quality of care at the time of delivery. In such circumstances, a license requirement might help improve public health and safety.”[24]  In contrast, licensing requirements in fields where “consumer risks are low or entirely speculative” are inappropriate.  She used the example of cosmetology: “A bad haircut or makeup application is markedly obvious to a consumer and to all of her friends. Bad haircuts or makeup applications quickly have consequences for the cosmetologist. The consumer risk is low and fleeting, but the excessive licensure requirement is not – it creates a large burden on those seeking to enter the workforce and limits competition.”[25]  More broadly, she explained that “licensure disproportionally affects those seeking to move up the lower and middle rungs of the economic ladder,” as it requires people to expend time and money on meeting often state-specific licensing requirements.[26]

In a December 2017 speech at Georgetown University, Ohlhausen explained her view that large, growing companies, such as Amazon or Google, do not unduly threaten competition and are not on track to becoming monopolies prohibited by antitrust law.  Companies’ occupying a big portion of the market at one time, she explained, does not erode free and open markets, and instead the touchstone of antitrust enforcement is the actual likely harm to consumers in an open market system.[27]  Monopolies, she explained, are acceptable as long as they gain consumers by merit, rather than anticompetitive practices short-circuiting their competition.  Even practices such as a company’s artificially lowering its prices to eliminate competition, then raising prices once it did so, are permissible because so long as the possibility of marketplace “entry remains, possible predation [of competitors] makes no economic sense.”[28]  In her concluding remarks, she described herself as neither “a champion of today’s leading Internet firms nor their foe,” and her and the FTC’s policy positions as ones “that [leading internet firms] sometimes love and sometimes hate.”[29]

Of her January 2018 nomination to the U.S. Court of Federal Claims, Ohlhausen stated: “I am honored that the President has expressed his intent to nominate me to be a judge on the U.S. Court of Federal Claims, one of the oldest federal courts in our nation. In the meantime, I will continue to serve at the Federal Trade Commission until a time when I may be so fortunate as to be confirmed to the Court of Federal Claims by the United States Senate.”[30]

FTC Administrative Decisions

Commissioner Ohlhausen has participated in over 1,000 administrative FTC decisions, including merits determinations of alleged FTC violations and policy guidance issued by the commission.[31]  The following highlights positions that Ohlhausen has taken within this administrative process evincing her focus on and prioritization of free markets via deregulation:

In 2012, Ohlhausen dissented from the FTC’s decision to withdraw a 2003 policy statement that it would not pursue disgorgement (pursuit of monetary equitable relief) except in the clearest of cases of FTC violations.[32]  She criticized the commission’s proffered basis for rescinding the policy statement, that it “has chilled the pursuit of monetary remedies in the

years since [its] issuance,” as not based in empirical evidence to this effect.  She further criticized the commission’s stated view that, instead of the policy statement, the FTC “will rely instead upon existing law, which provides sufficient guidance on the use of monetary equitable remedies,” as a toothless statement that “ could be used to justify a decision to refrain from issuing any guidance whatsoever about how this agency will interpret and exercise its statutory authority on any issue.”[33]

Since that dissent, Ohlhausen has been vocal about her opposition to the decision to withdraw this policy statement in subsequent decisions, including those in which she concurred in the decision to pursue disgorgement.  In a 2015 decision, FTC v. Cephalon, Inc., the FTC found that Cephalon had engaged in anti-competitive conduct by paying four firms to refrain from selling generic versions of Cephalon’s patented drug for an extended period of time, thereby inhibiting competition and denying patients access to lower-cost versions of the drug.[34]  Ohlhausen agreed that disgorgement was appropriate, but because Cephalon’s conduct met the test laid out in the since-rescinded policy statement.  She noted in her concurrence, “the incentive to pursue monetary remedies more frequently, particularly in other cases without a clear violation, may cause the Commission to neglect its special mission to develop the antitrust laws through Part III litigation and other unique tools. That concern is only heightened now that we are counting disgorgement in the billions of dollars.”  She reiterated these concerns in her 2017 concurrence to In the Matter of Mallinckrodt ARD Inc., where the FTC found that a pharmaceutical company engaged in anticompetitive conduct by attempting to create a monopoly with respect to a particular drug.[35]  Ohlhausen expressed “concerns about [the] aspect of the remedy” for this conduct that required the company to pay over $100 million in disgorgement.  The case, Ohlhausen contended, should have been handled through the FTC’s administrative process rather than filed in federal court (a predicate for pursuing and obtaining the remedy of disgorgement).[36]

In 2013, the FTC filed a complaint against and conducted an investigation of Google, In the Matter of Google Inc., for its alleged anticompetitive practices relating to, inter alia, seeking to enjoin putative licensees of Google’s “standard essential patents” (patents required to comply with a technical standard, thereby encouraging adoption of a common platform among rival producers, which in turn fosters competition).  This, the FTC charged, violated Google’s duty to offer such patents on “fair, reasonable, and non-discriminatory terms.”[37]  The FTC and Google ultimately reached an agreement whereby Google agreed to not seek such injunctions, as well as remove restrictions on the use of its online search advertising platform that may have made it more difficult for advertisers to coordinate online advertising campaigns across multiple platforms.[38]  Ohlhausen criticized the portion of the decision related to these restrictions as not premised on a showing of actual harm to competitors in the form of increased costs or Google’s monopolization of the market, thus potentially discouraging innovation by needlessly punishing Google.[39]  “If our cases – particularly our standalone [unfair and anticompetitive practices] cases – are not anchored to competitive and ultimately consumer harm, then they are completely adrift. I am hopeful that the Commission will maintain its focus on competitive and consumer harm as it moves beyond this matter.”

Overall Assessment

Ohlhausen has a long, distinguished career in FTC-related private practice and the FTC itself.  While her economic knowledge and experience are unimpeachable, it is not clear that her expertise relates to the subject matter of lawsuits within the U.S. Court of Federal Claims’ jurisdiction — claims for money damages arising from the United States Constitution, federal statutes, executive regulations, or an express or implied in fact contract with the United States Government.[40]  However, the economy is not an esoteric subject and her knowledge base is not inapposite to the claims the court hears, she has served in an adjuratory capacity as an FTC commissioner, and she has substantial federal clerking experience, including on the Court of Federal Claims.  As such, Ohlhausen will likely be confirmed by the Senate.

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