New Section 5 Statement ‘Highlight’ of Former FTC Commissioner Wright’s Tenure
Former FTC Commissioner Josh Wright shared during a Federalist Society teleforum Tuesday that the highlight of his tenure at the FTC was the issuance of the commission’s FTC Act Section 5 statement. Wright, who left the commission in late August, suggested his replacement come in with an agenda so he or she could focus his or her efforts, and pushed back against those who said he had a negative view of the agency, saying he agreed with the majority of commissioners 99 percent of the time.
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Wright said he was “very, very pleased” with the Section 5 statement the commission formalized in August (see 1508130045) on its authority to take enforcement actions against companies for “unfair” competition practices that fall outside the Clayton Act and Sherman Act, noting that Section 5 is something he has been thinking and writing about for years. Sworn in as an FTC commissioner in January 2013, by that June, Wright had written his own statement on Section 5. Though Wright agrees with a different Section 5 statement that the commission approved, he said that statement doesn’t go as far as his original.
Writing Section 5 guidance is important because the nature of the agency’s unfair method authorities had never been defined until now, Wright said. The authority was interpreted as whatever three commissioners wanted it to be at any point in time, he said. Sometimes that authority was greater than other antitrust law, Wright said.
In his original statement, Wright tried to restrict the powers of Section 5 because he was concerned that the agency had an historical record of winning Administrative Law cases 100 percent of the time in a 25-year period. The FTC’s record wasn’t because the agency picked good cases, but because the agency gave itself superpower advantages, Wright said. It’s a “bad idea to bestow superpowers on a regulatory agency,” he said. Restricting the agency’s authority on a stand-alone basis would have meant that the agency wouldn’t have been able to try some cases but would have had to work with the Justice Department’s Antitrust Division to bring cases before a federal court, Wright said.
Though the current Section 5 statement doesn’t go as far as Wright would have liked, he said the three-quarters of a page-long statement is underappreciated. The leading critique is that the statement doesn’t do much, but its real power is that the case guidelines may affect agency’s willingness to litigate and may compel an Article III judge -- those on the federal district, appeals and Supreme Court and the U.S. Court of International Trade -- to settle what doctrine is in those cases, he said. Boundaries need to be set in this area of law, Wright said.
While Wright was a commissioner, he said he was often asked why he disagreed with the other commissioners so much. “I dissented in 1 percent of consumer protection cases,” Wright said. The commissioners have different skill sets and view things differently, which Wright said is a “feature” of the agency, “not a bug.”
Though the Section 5 statement was the most important item on Wright’s agenda as an FTC commissioner, he said if he had had another year at the commission he would have become more active in the international antitrust and intellectual property space, and would have spent more time getting involved in FTC complaints, such as the agency’s complaint against car-hailing service Uber.
Wright suggested his successor surround him- or herself with staff who are smarter than the commissioner is and not be afraid to tell the commissioner if he or she is wrong. The next commissioner should also have his or her own economic adviser, Wright said, because the agency has begun to consider the economics of consumer protection issues like privacy. Lastly, he suggested the next commissioner have an agenda before beginning at the agency so the office knows what battles it wants to fight and can organize activities accordingly.