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

From: Declan McCullagh (declanat_private)
Date: Wed Jun 13 2001 - 06:55:54 PDT

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    http://www.wired.com/news/politics/0,1283,44485,00.html
    
       New FTC Head Sketches Landscape
       By Declan McCullagh (declanat_private) 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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