DOJ Antitrust Nominee Seen Walking Traditional Conservative Path

Not everyone sees a predictable Delrahim path. Rather than a libertarian, like FTC transition team head Joshua Wright, who was rumored as a possible antitrust chief nominee, Delrahim is "a political operator," said Matt Stoller, a fellow at New America's Open Markets program. Delrahim could go any number of ways, and there may not be a consistent DOJ direction on antitrust, Stoller said.

Democrats likely won't put up a major challenge to the nomination, officials said. Some Senate Judiciary Committee members have particular interest in antitrust, such as Al Franken and Amy Klobuchar, both of Minnesota, and Connecticut's Richard Blumenthal, meaning there could be some heated rhetoric about and tough questions to Delrahim, said Cleveland-Marshall College of Law Thomas Distinguished Professor of Law Christopher Sagers, but a filibuster would be unlikely. Delrahim's lobbying work could cause criticism, but the antitrust head isn't a position that generally warrants "drawing lines in the sand," Van Fleet said.

More critical than Delrahim's ideological stance, the confirmation hearing should focus on " a coherent, bipartisan approach to the role of antitrust in addressing declining competition in the economy," the American Antitrust Institute said in a statement Tuesday.

For companies considering big mergers and acquisitions that require DOJ review, Delrahim's nomination "is a sigh of relief" because it eliminates some uncertainty about what the government is going to do, said antitrust lawyer/former CableLabs General Counsel Dorothy Raymond. Delrahim likely doesn't subscribe to the "big is bad" school of thought and is open to economic evidence of anticompetitive effects, she said. "If you follow the pendulum theory of antitrust law ... he's not going to swing it that much.”

Delrahim will likely be "a classical Republican antitrust enforcer in the nature of a Jim Rill," who headed DOJ antitrust during the senior Bush administration, Van Fleet said. Delrahim "believes in a free market and believes a free market needs to have some limits to keep it free," with Delrahim likely taking a strong enforcement stance on price fixing and other cartels, Van Fleet said: "Not all mergers are going to get through, not all are going to be challenged." Rill didn't comment.

Donald Trump on the campaign trail expressed opposition to AT&T buying Time Warner on media consolidation grounds (see 1610220002), but Delrahim "would have no truck with that, to the extent I know Makan," Van Fleet said. He also "is not going to have a lot of heartburn" about vertically integrated mergers unless the deal has a horizontal foreclosure aspect, Van Fleet said.

Given Delrahim's time as a lobbyist and as staff director and chief counsel of the Senate Judiciary Committee, "it's hard to know what positions he has taken in the past are his personally," Sagers said. "People saying he will be aggressive as an enforcer ... are exaggerating a bit," he said. Some previous DOJ antitrust heads in Republican administrations, while believing in antitrust enforcement, took a limited approach with the major targets "being the hardest-core violations" such as horizontal price fixing or the largest horizontal mergers, Sagers said. With Delrahim, he said, "the best bet is we will see something like that.”

M&A Curbs

Under Delrahim, big demands for M&A concessions likely will be seen only in very big horizontal deals, while vertical arrangements probably will not see any pushback, Sagers said.

There could be an uptick in DOJ antitrust activity on issues raised by government interference such as state or local government licensing or market regulation, said Sagers. He waved off whether Trump would try to press the DOJ to block AT&T/TW due to the impropriety. Delrahim is "a little inscrutable but all the indications are he will be pretty friendly about big mergers," especially since AT&T/TW can be seen as purely vertical and thus arguably not anticompetitive, he said.

A member of the Antitrust Modernization Commission, Delrahim in comments in the commission's 2007 report indicated he was particularly keenly interested in issues of antitrust and intellectual property, particularly as those issues intersect internationally. He also backed standards setting -- either by the private sector in in government-sponsored initiatives -- as a means to promote the dynamic efficiency in making a new technology available to consumers. But he voiced concerns about de jure standards setting by collaboration leading to excluding some participants from an industry. He indicated in the report that while serving on the commission, he represented such firms as Oracle, Microsoft, Qualcomm, Intel, Apple, Johnson & Johnson, Sanofi-Aventis and the Medical Device Manufacturers Association.

Once confirmed by the Senate, Delrahim "can be expected to be a traditional Republican antitrust enforcer, with: a constitutional conservative approach to the law; a strong respect for intellectual property rights; a rich appreciation of international antitrust enforcement; a practical focus on the antitrust long view; and a whole lot more clout than any traditional DOJ Antitrust Chief," said NetCompetition Chairman Scott Cleland in a blog post Tuesday. Cleland, whose group includes ISPs according to its website, also said it's possible Delrahim's antitrust division might take on Google antitrust enforcement in a way that has been absent from the FTC in recent years. "This would not be the first time that the DOJ would have to take over a dysfunctional FTC tech-related antitrust prosecution," he said, pointing to DOJ's taking over the FTC's Microsoft/IBM collusion probe in 1993. "If Makan Delrahim wants the DOJ to take the antitrust lead on the overall Google antitrust problem/case, he apparently has the institutional trust, clout, and authority to make it happen," he said. The FTC didn't comment.

Delrahim “is an excellent choice,” emailed Barry Nigro, Fried Frank antitrust group practice chairman. "He is a firm believer in the role of antitrust enforcement to protect consumers. I expect Makan to be practical in his approach to antitrust policy; he won’t shy away from making the difficult decisions.”