Yesterday, TechFreedom filed comments to the Federal Trade Commission (FTC) in support of an amendment to the Commission’s current rule on disqualification of Commissioners. TechFreedom supports a petition filed by the U.S. Chamber of Commerce and agrees that FTC rules should make clear that prejudgment and appearance of bias require recusal.

The FTC needs a better disqualification process to protect its reputation for objectivity and to guard against wasting limited staff resources,” said Berin Szóka, President of TechFreedom. “When the FTC prosecutes cases in its internal administrative procedure, it also sits as judge and jury, so a lack of objectivity seriously undermines the due process rights of defendants. When Commissioners have prejudged such cases or demonstrated bias, courts have voided the entire proceeding. Defendants must litigate their case before an administrative law judge, then before a Commission they consider biased. Only after what they consider to be a foreordained loss can they raise the issue of prejudgment and bias in federal court. This isn’t just unfair to defendants; it also means the Commission could waste 1-2 years litigating a case that gets tossed out in court.”

Prejudgment and bias haven’t really been a problem at the FTC for decades, but they are now,” continued Szóka. “The White House picked Lina Khan because of her detailed critiques of tech companies, both in her scholarship and in her work for a congressional investigation of those companies. Now these are huge liabilities; they could lead courts to void FTC enforcement actions. Bringing these suits in federal court would greatly reduce that risk. After all, federal judges would assess the substantive merits of such suits themselves. Instead, Khan has brought several such suits before the FTC’s administrative tribunal. This gives the agency many advantages, including deference from federal courts on findings of fact. But it also requires a higher level of objectivity. Khan has breezily dismissed concerns about her prejudgment and bias. The FTC is in for a rude surprise when these cases finally get to federal court.”

“The problem isn’t just Khan; by failing to mention prejudgment and bias, the FTC’s current disqualification rule makes it all too easy for Commissioners to insist that only financial conflicts of interest could possibly require disqualification, as Khan has done,” concluded Szóka. “The Chamber’s petition would focus attention on these issues as both due process matters and as risks to the Commission. Adopting the proposed rule would protect the Commission from wasting scarce resources and everyone’s time.”


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