Fb asks for FTC Chair Lina Khan to be recused from its antitrust case

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Lina Khan, Commissioner of the Federal Trade Commission (FTC) candidate for United States President Joe Biden, speaks during a Senate Confirmation Hearing on Commerce, Science and Transportation in Washington, DC, the United States, on Wednesday, April 21, 2021.

Graeme Jennings | Bloomberg | Getty Images

Facebook filed a petition on Wednesday to withdraw Federal Trade Commission Chair Lina Khan from the agency’s ongoing antitrust lawsuit against the company.

Facebook argued in its petition that Khan had “consistently made public statements” accusing the company of bad behavior in violation of antitrust law. The company said their previous work made it clear that Khan had already decided on Facebook’s liability in the pending antitrust case, which should be a reason for a rejection.

The FTC will have to decide in the coming weeks whether to file an amended complaint in its antitrust case against Facebook in federal court after a judge dismissed its original claims. Alternatively, the FTC could decide to try the case internally in front of its administrative judge.

Facebook’s petition follows a similar move by Amazon, which Khan rejected because of their previous criticism of his power of antitrust investigations. Khan gained scientific fame after publishing “Amazon’s Antitrust Paradox” in the Yale Law Journal in 2017 while studying at university.

The article argued that the unique business models of digital giants like Amazon need to be assessed with a broader antitrust framework alongside the popular consumer protection standard, which often depends heavily on whether prices go up or down for consumers. Khan wrote at the time that a new framework could help understand why a platform that prioritizes growth might get involved in predatory pricing.

Facebook wrote that it agreed with Amazon’s arguments in favor of rejection in its own petition, reiterating previous cases where commissioners have been denied for prejudice. For example, in the Cinderella Career & Finishing School v FTC case, the court said that a chairman’s refusal to retire was a denial of due process.

Amazon found that the court in this case also convicted the chairman for working on a previous case with the same facts that he investigated on Capitol Hill. Prior to joining the FTC, Khan worked for the Democrats on the House Antitrust Subcommittee, where she helped produce the report on Amazon, Apple, Facebook and Google that found both to be in monopoly power and make recommendations for one Legal reform existed.

Khan also previously served as legal director for the Open Markets Institute, a political advocacy group that pushed Congress and government agencies to better oversee the dominant tech companies. Facebook noted that in this role, Open Markets had campaigned for the FTC to reverse its approval of Facebook’s previous acquisitions of Instagram and WhatsApp. These mergers play a prominent role in the FTC’s lawsuit against the company.

Khan responded to a question at her Senate confirmatory hearing on whether she should back off from cases with the tech companies given her previous work. She said at the time that she had no financial conflicts that would constitute grounds for refusal under ethical laws, and that she would follow the facts wherever they lead.

And there is a precedent that could support their case. An FTC chairman in the 1970s was initially banned from a rules investigative investigation into children’s television advertising due to his earlier criticism of the practices. But later an appeals court overturned this judgment.

The chairman, however, opted to withdraw himself from the matter because he said it had become a distraction from the investigation.

The FTC declined to comment on the motion for rejection.

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