Professor Kirkwood testifies before congressional committee
April 05, 2014
Professor John B. Kirkwood, a nationally recognized expert in antitrust law, testified before a U.S. House Judiciary subcommittee on April 3 about a proposed bill that would require the Department of Justice and the Federal Trade Commission to challenge mergers in the same way, using the same legal test and the same process.
The bill, known as the Standard Merger and Acquisitions Review through Equal Rules (SMARTER) Act, would raise the bar the FTC must clear to win preliminary injunctions against mergers. Currently, the DOJ must show a reasonable likelihood of success but many courts allow the FTC to show only that the merger raises substantial questions.
And while the DOJ generally agrees with the parties to consolidate preliminary and permanent injunction hearings, the FTC has insisted on seeking only preliminary injunctions from the federal courts and trying the merits of cases in their own administrative proceedings. While these proceedings are subject to judicial review, they last longer than court hearings. The bill would prohibit the FTC from using administrative trials in merger cases.
Kirkwood told the subcommittee that applying the same preliminary injunction standards to both agencies made more sense than doing away with the FTC's administrative option. In a routine case, he said, the outcome of a preliminary injunction request should not depend on which agency reviewed the transaction. But preventing the FTC from using the administrative process, a principal reason for the creation of the expert independent agency, was much harder to justify.
"This may be an opening wedge in an attack on dual enforcement, a system that Congress created, that it has maintained for a hundred years and that has generally worked well, providing some competition, so to speak, in federal antitrust enforcement," Kirkwood said in written testimony. "From this perspective, the elimination of the FTC's administrative power in the merger area would be disturbing and likely to harm consumers."
Kirkwood is regularly sought for his expertise in antitrust law. He won the Jerry S. Cohen Award for the best antitrust scholarship of 2012 for his article, "Powerful Buyers and Merger Enforcement," published in the Boston University Law Review.