FTC’s Lina Khan isn’t letting up on Big Tech even with her future in doubt
10 Desember 2024
0 4 minutes read
Lina Khan’s time may be running out as boss of the Federal Trade Commission, but she is not going quietly.
The FTC chairwoman recently signed off on a request to Microsoft (MSFT) that is hundreds of pages long and demands information connected with a long-running antitrust investigation of the tech giant, according to Bloomberg.
The investigation is wide ranging and touches everything from cloud computing to artificial intelligence, according to Bloomberg. Microsoft is a dominant cloud provider and has invested nearly $14 billion in the AI startup OpenAI, creator of ChatGPT.
FTC Chairwoman Lina Khan, testifying in May. (Tom Williams/CQ-Roll Call, Inc via Getty Images) ·Tom Williams via Getty Images
Khan, since being appointed by President Joe Biden in 2021, has aggressively pursued lawsuits and investigations targeting a number of the biggest tech giants. But this most recent escalation comes just weeks before President-elect Donald Trump is set to retake the Oval Office in January.
Khan is not the only US regulator turning up the dial in the final stretch of Biden’s term.
Another is Rohit Chopra of the Consumer Financial Protection Bureau, which on Friday claimed it had supervision authority over Google’s payment platform Google Payment Corp.
That resulted in an immediate lawsuit from Google parent Alphabet (GOOG, GOOGL).
The company sued CFPB and Chopra, who is expected to leave once the Trump administration takes power, saying that CFPB’s action “suffers from numerous legal defects.”
Billionaire Elon Musk, a key adviser to the incoming Trump administration, has called for the CFPB to be eliminated. It has has sued and fined a number of financial tech firms and other startups it accused of deceiving customers.
U.S. Consumer Financial Protection Bureau (CFPB) director Rohit Chopra, testifying in 2023. REUTERS/Leah Millis ·REUTERS / Reuters
What may be telling in these late actions from FTC and CFPB is that they both target Big Tech companies, an area where the Biden administration may have some alignment with Trump 2.0.
The latest sign came last week when he said he would nominate Gail Slater, an aide to Vice President-elect JD Vance, to lead the Justice Department’s antitrust division. Vance, has expressed admiration for the aggressive approach of Khan.
“Big Tech has run wild for years,” Trump said in a statement announcing the Slater appointment on his Truth Social platform, “stifling competition in our most innovative sector and, as we all know, using its market power to crack down on the rights of so many Americans, as well as those of Little Tech!”
“I was proud to fight these abuses in my First Term, and our Department of Justice’s antitrust team will continue that work under Gail’s leadership,” he added.
It was Trump’s first administration that initially sued Google over antitrust concerns, which led to a ruling by a district court judge in August that the tech giant illegally monopolized the search engine market. The DOJ has asked a judge to consider breaking up the company in a separate phase of the trial that won’t wrap up until 2025.
Sundar Pichai, CEO. of Google and Alphabet, speaks during the New York Times annual DealBook summit on Dec. 4. (Photo by Michael M. Santiago/Getty Images) ·Michael M. Santiago via Getty Images
It was also during Trump’s first administration that the FTC sought to unwind Meta’s (META) acquisitions of Instagram and WhatsApp in a case set for trial in April. Trump’s first administration also launched an antitrust investigation into Apple (APPL), leading the Biden administration to sue the iPhone maker earlier this year.
The New York Post reported last week that the question of who should replace Khan at the FTC is turning into a battle as those who want a more aggressive or a more favorable approach to Big Tech state their views.
Republicans who want a smoother M&A environment, according to the Post, favor Melissa Holyoak, a Republican FTC commissioner. Other possibilities are another Republican FTC commissioner Andrew Ferguson and former DOJ and FTC official Mark Meador.
There is certainly no guarantee Khan’s replacement will hold a similar point of view, or continue her pursuits.
“We don’t know who’s going to succeed Lina Khan, but you can bet it’s not going to be anyone with the philosophy of Lina Khan,” said former FTC member and University of Baltimore Law School antitrust professor Robert Lande.
The Federal Trade Commission building in Washington, DC. (AP Photo/Jose Luis Magana) ·ASSOCIATED PRESS
Lande, who served on the FTC’s Bureau of Competition during the transition between president Gerald Ford’s and Ronald Reagan’s administrations, said the FTC’s future is more of a wild card compared to the DOJ.
“There’s an idea that anybody can be the chair of the FTC,” he said, noting that past chairs have included former Postal Rate Commission Chair Janet Steiger and Dan Oliver, former editor of the conservative news outlet National Review.
“So Trump can put in anyone he wants,” Lande said. “It won’t necessarily be an antitrust lawyer, or a consumer protection lawyer,” or anyone with a background in law, economics, or business.
A new chair without antitrust expertise, or one whose competition philosophies part ways with Khan could ease the many legal threats currently facing big tech companies. The pace of continued scrutiny will no doubt depend on the DOJ’s combined efforts with the FTC.
In the history of the FTC, Lande said, there have been just two periods of what he called “serious activism.” One was under Democratic chairman Michael Pertschuk, who was the chair before President Reagan was elected.
