Senate confirms Big Tech critic Jonathan Kanter to lead DOJ Antitrust Division – CNBC

Antitrust attorney Jonathan Kanter testifies before the Senate Judiciary Committee October 6, 2021 in Washington, DC.

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The Senate voted 68-29 on Tuesday to confirm Jonathan Kanter as Assistant Attorney General of the Department of Justice’s Antitrust Division.

Progressives cheered President Joe Biden’s decision to nominate Kanter, completing the trifecta of antitrust reformers whose names are printed on coffee mugs. The others are Federal Trade Commission Chair Lina Khan and National Economic Council advisor Tim Wu.

As the DOJ’s new antitrust chief, Kanter will inherit a lawsuit against Google filed during the Trump administration. But it’s unclear if Kanter will recuse himself from the case, given his past work for Google rivals, including Yelp and Microsoft.

The DOJ has also reportedly looked into competition concerns around Apple. Kanter has done work for Spotify, which competes with Apple Music.

Kanter told lawmakers he would consult with ethics officials at the DOJ about recusal if confirmed. Still, he would be in position to appoint deputies that could assist his antitrust approach.

Kanter has won the support of senators across the aisle who have argued that too few tech companies control an outsized amount of power. Several Republican senators voted in favor of Kanter’s confirmation, including Sens. Chuck Grassley, R-Iowa, and Mike Lee, R-Utah, ranking members on the Judiciary Committee and its antitrust subcommittee, respectively.

His nomination had previously advanced out of the Judiciary Committee in a voice vote.

Sen. John Cornyn, R-Texas, was the only member of the Senate Judiciary Committee who asked to be marked as voting against the advancement of Kanter’s nomination to the floor. Cornyn said that while he shared some of Kanter’s concerns with the tech industry and supported legislation to curb the industry’s influence, “the DOJ’s Antitrust Division is much broader than just dealing with Big Tech.”

Cornyn said he’s “troubled” by Kanter’s criticism of the consumer welfare standard, the prevalent judicial framework that has guided antitrust rulings for decades, and is hesitant about the “broad standard” he says Kanter favors. Reform-minded antitrust scholars and practitioners have argued the standard, which often looks at whether prices go up or down for consumers, is too narrow to assess modern market realities, like those created by digital platforms.

Cornyn said Kanter’s openness to the use of antitrust enforcement to strengthen labor rights, for example, is not appropriate for that statute.

“I share Mr. Kanter’s goal of making sure that markets do work for the American people, but I don’t support undercutting important antitrust legal principles in the service of short-term political goals,” Cornyn said.

Sen. Amy Klobuchar, D-Minn., chair of the antitrust subcommittee, responded to Cornyn by pointing to the support of Kanter by Trump’s antitrust chief Makan Delrahim. Delrahim was one of the nine former DOJ antitrust chiefs who signed a letter to Judiciary Committee leaders encouraging Kanter’s swift confirmation.

“Overall, he is where this committee is in terms of how we’ve talked about this,” Klobuchar said of Kanter. “This is a moment where we can unite and get behind a nominee, just as I got behind Makan Delrahim when Donald Trump nominated him because I understood we had to move forward, even though he might not have been my first choice for antitrust.”

Relationship with the FTC

Once Kanter gets started at the Antitrust Division, businesses and their lawyers will be watching closely for policy signals and indications of how he’ll steer the organization in line with, or differently, from Khan’s FTC.

While Khan and Kanter were similarly seen as progressive favorites prior to their nominations, Kanter’s background has put him in close proximity to the type of lawyers who will bring mergers and competition concerns before the agency. Before leaving to start his own law practice, he worked for the law firm Paul, Weiss, Rifkind, Wharton & Garrison. Khan, the youngest person sworn in to lead the commission at age 32, came from a teaching job at Columbia Law School after helping to write a report for the House Judiciary subcommittee on antitrust on competition in digital markets.

Khan has already implemented several policies on the competition side that have left lawyers with work before the commission scratching their heads. For example, under her leadership, the FTC has begun asking broader questions about the potential impacts that transactions could have, like on labor markets. Some antitrust practitioners say such questions aren’t directly relevant to evaluating harm to competition, though the FTC has signaled it wants to take a more expansive view of the impacts of competition.

Kanter has indicated that he may not follow the same approach. At his confirmation hearing, Lee, the antitrust subcommittee ranking member, asked if Kanter would ask subjects of antitrust investigations about their ESG (environmental, social and governance) policies in evaluating competitive harm.

“I don’t see situations where ESG policies that are unrelated to competitive issues are relevant to antitrust enforcement,” Kanter said.

The Antitrust Division shares jurisdiction with the FTC over civil antitrust conduct cases as well as merger review. The agencies typically divide up work through a process known as clearance. Experience in matters involving a particular industry is usually a key consideration in the clearance process, with hospital mergers often falling to the FTC, for example. But some industries, like tech, are less clear-cut, because each agency has experience in those matters.

Clearance has been a point of contention between agency heads as recently as during the Trump administration between then-FTC Chair Joe Simons and then-Antitrust Division chief Delrahim. The two ended up splitting ownership of tech antitrust investigations, with the FTC taking the lead on Facebook and Amazon and the DOJ taking Apple and Google, as multiple outlets reported in 2019.

Kanter said in his written responses for the record that if confirmed, he would “endeavor to ensure the efficient and proper division of responsibility between the DOJ and FTC, including the avoidance of unnecessary duplication.”

He also referenced his past work as an FTC lawyer, saying, “I am hopeful that my perspective will enhance collaboration between the two agencies.”

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