Politech: FC: FTC chairman speaks on antitrust, online fraud -- but not privacy

[Declan McCullagh <declan () well com>]

http://www.wired.com/news/politics/0,1283,44485,00.html

   New FTC Head Sketches Landscape
   By Declan McCullagh (declan () wired com) and Jonathan Sheir
   2:00 a.m. June 13, 2001 PDT
   
   WASHINGTON -- The new chairman of the Federal Trade Commission lauded
   his predecessor's work on Internet consumer protection Friday and
   signaled the agency may take a more skeptical look at antitrust
   enforcement.
   
   In his first public remarks since starting last week, Tim Muris said
   he would continue the agency's series of hearings on online fraud and
   said the actions of former chairman Robert Pitofsky have set "a high
   bar for future commissions."
   
   Muris said that he disagreed with some of Pitofsky's decisions on
   antitrust enforcement -- which the FTC shares with the Justice
   Department -- but said that "departures from relying on good economics
   were exceptions, not the norm."

   [...]


http://www.ftc.gov/opa/2001/06/aai2.htm

   For Release: June 12, 2001
   Muris Addresses American Antitrust Institute;
   
   Speech Lauds Predecessor
   
   Federal Trade Commission Chairman Timothy J. Muris today said that the
   transition of the Chair at the agency will be characterized more by
   continuity than by conflict. Speaking at the Second Annual Conference
   of the American Antitrust Institute, Muris praised former Chairman
   Robert Pitofsky's record and said their areas of agreement far
   outnumbered areas of dispute.
   
   "Bob and I are of like mind, but have not always agreed," Muris said.
   "But agreement is not the best basis to evaluate a scholar or a
   Chairman. A more objective measure is whether he had a coherent,
   principled vision for the agency and was able to implement it. By this
   measure, Bob has been a resounding success. Today's Federal Trade
   Commission is the agency that Pitofsky and his American Bar
   Association colleagues envisioned some 30 years ago, and he can take
   enormous credit for this accomplishment."
   
   CONSUMER PROTECTION
   
   Speaking of a 1989 ABA Report to which both Pitofsky and Muris
   contributed, the newly-installed Chairman said, ". . . On consumer
   protection, differences were largely inconsequential. We agreed that
   the Commission needed to assert national leadership more aggressively;
   focus on significant cases, particularly fraud; work closely with the
   states; and provide clearer guidance to industry."
   
   Muris praised the Commission's work under Pitofsky's leadership to
   combat fraud and deception in the e-commerce arena, calling the
   results "impressive."
   
   "While the new medium was still in its infancy, the Commission moved
   quickly to establish an intellectual framework for applying
   well-settled consumer protection principles online. It held a series
   of hearings on Consumer Protection in the High-Tech Global
   Marketplace, which it used to craft a blueprint for Commission action.
   With the overall goal of protecting consumers without imposing
   unnecessary burdens on this emerging marketplace, the plan called for
   aggressive law enforcement, especially against fraud; consumer and
   industry education; and the development of policies in areas raising
   new consumer protection concerns, including privacy."
   
   Muris said, "The online law enforcement program has:
     * produced more than 200 cases challenging deceptive practices;
     * transformed the way the agency does business by pioneering the use
       of the Internet as a law enforcement tool; training state, local
       and international consumer protection officials in online
       investigative methods; and creating a global database to
       coordinate law enforcement efforts;
     * instituted 'surf days' to locate patently deceptive promotions and
       organized 'sweeps' on a global scale to shut down fraudulent
       operators."
       
   Noting business and industry guidance provided through publications,
   seminars and workshops conducted during the Pitofsky era, Muris said,
   "I believe that the Commission's public workshops in recent years have
   been immensely helpful to consumers and industry, and I intend for the
   Commission to continue them.
   
   "In addition to applying well-settled consumer protection principles
   to the Internet, the Commission fostered dialogue among the industry,
   the public, and the government about developing areas of consumer
   concern, including online privacy. During Chairman Pitofsky's tenure,
   the FTC held nine public workshops on privacy issues, worked with
   industry to encourage self-regulatory efforts, conducted two major
   surveys of Web sites' privacy practices, and issued a series of
   Reports to Congress."
   
   "The consumer protection record of the last six years under Pitofsky
   sets a high bar for future Commissions," Muris said.
   
   COMPETITION
   
   ". . . Today there is bipartisan recognition that antitrust is a way
   of organizing our economy. A freely functioning market, subject to the
   rules of antitrust, provides maximum benefits to consumers," Muris
   said.
   
   Muris termed attempts to compartmentalize economic analysis as
   "Chicago" and "Post-Chicago" schools ". . . a sterile exercise.
   Regarding antitrust, we must have solid economic analysis that is
   firmly grounded in facts and real world institutions," Muris said.
   "These traits characterize what might simply be called good economics,
   rather than economics of any 'school.' Although I have not always
   agreed with cases brought by the Pitofsky FTC, Commission departures
   from relying on good economics were exceptions, not the norm."
   
   He pointed to the Pitofsky era use of fact-finding hearings and
   workshops to ". . . identify the appropriate path of future policies
   and to formulate a law enforcement and advocacy agenda.
   
   . . . The Pitofsky Commission used the FTC's historically important
   research and reporting capabilities to shape policy. Future
   Commissions will no doubt continue to use these unique FTC
   capabilities."
   
   "The Commission confronted special challenges posed by innovation
   competition, e-commerce, globalization, and rapid technological
   change. Although I have disagreed with some of the Pitofsky Commission
   initiatives here, we agree that the potential for anticompetitive
   abuse of intellectual property is an increasingly important area.
   While recognizing the necessity of protecting valid intellectual
   property rights, future Commissions will no doubt remain active," he
   concluded.



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