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FTC, DOJ turf wars unlikely to blunt big tech probes

Top federal antitrust officials at the U.S. Federal Trade Commission and U.S. Department of Justice recently acknowledged that the agencies sometimes have clashed over jurisdiction, but antitrust experts say the discord is unlikely to dull the impact or thoroughness of probes into big tech.

In July, Facebook Inc. disclosed that the FTC was investigating the company for antitrust concerns. Alphabet Inc. disclosed in September that the DOJ was probing previous antitrust investigations at the company. Beyond these, the FTC and DOJ both have broader ongoing antitrust reviews evaluating the ways large tech platforms may have harmed consumers.

The DOJ also intends to initiate an antitrust probe into Facebook, according to a Sept. 25 Bloomberg News report.

SNL ImageFacebook CEO Mark Zuckerberg testifies before Congress
Source: AP

The agencies are theoretically supposed to consult with each other on possible antitrust investigations where the two agencies could overlap to determine which agency is best suited to take on a probe, though officials from both agencies acknowledged last month that this process has broken down at times.

Those acknowledgments have led some in Congress to express concerns that the turf wars could undermine enforcement efforts against big tech companies. However, in general, antitrust experts with experience at both agencies do not feel the jurisdictional disagreements will likely have a huge impact on the outcomes of the investigations.

"I don't think the rivalry is to bring a case, because there are costs to bringing a bad case," John Yun, who previously served as acting deputy assistant director in the economics bureau in the antitrust division at the FTC, said in an interview. Instead, Yun believes they are trying to one-up each other in terms of being thorough in their investigations.

"They're trying to, in some way, I think, outdo each other a little bit … maybe in trying to really overturn all stones," said Yun, who is now the director of economic education at the Global Antitrust Institute at George Mason University's law school. By doing that, the agencies are trying to make sure each viable theory of harm is fully investigated, Yun said.

Though the turf wars are unlikely to weaken the probes, they may lengthen the investigation time, said one antitrust attorney who previously worked at DOJ. It is also possible that one agency could rush litigation in an attempt to be first, the attorney said.

"It's conceivable that … you might have precipitous litigation, because if they really are looking at the same thing, there's a first-mover advantage of going at the court," said the attorney, adding that ultimately, "the prep may not be as good."

Duplicative investigations from different agencies with different standards could also lead to mass confusion for tech companies, which could cause tech firms to slow down their rate of technological innovation, as they may not know what the antitrust consequences of their actions would be, the attorney said.

William Kovacic, who previously was chairman of the FTC, said in an email that in theory, there can be significant benefits when antitrust enforcers collaborate.

"The intense collaboration would enable the agencies to make the best possible use of their resources by formulating a common strategy and building cases to carry it out," he said.

But that does not appear to be the case in the tech probes, according to Kovacic. Instead, we are "seeing the results of narrow-minded … institutional parochialism and a fundamental distrust among the agencies of the motives and abilities of their counterparts," he said.

For his part, Yun sees value in having one agency lead an antitrust probe.

"Someone needs to be on the vanguard of the deposition, the theories of harm, working with the experts, the economists," he said. "Having all these parties involved to some degree or another … in my view, has never been this harmonious, 'Oh this is great – we need to do this every time.'"

Still, Yun believes the jurisdictional fights will not impede meaningful enforcement, if that is what an antitrust enforcer concludes is necessary.

"The agencies are very, very good at this," he said. "I think they are giving it the full treatment and so, if something comes out of it, it's because it's been thorough. If something doesn't come out of it, it's also because it's thorough."