Sessions Signals Political Independence on Antitrust, Spurring AT&T/TW Review Speculation

Senators from the Judiciary Committee used this week’s attorney general confirmation hearing to probe whether the Trump administration Justice Department will remain independent of political influence. Antitrust experts following the hearing told us they see possible implications for how the incoming administration, with DOJ under the control of Sen. Jeff Sessions, R-Ala., could handle antitrust matters such as review of AT&T buying Time Warner. Two senators asking about political influence lead Judiciary’s Antitrust Subcommittee, which held a hearing on the proposed acquisition last month.

Antitrust regulators “will sometimes impose conditions,” said Antitrust Subcommittee Chairman Mike Lee, R-Utah, during his questioning of Sessions Tuesday. “It is my view that there is a temptation for antitrust regulators sometimes to impose conditions that don’t involve anticompetitive concerns, and that that raises some red flags.” Conditions ought to be focused on anticompetitive concerns, Lee said.

“I would agree with that,” Sessions told Lee. “It would be wrong to further some other separate discrete agenda that’s not reasonably connected to the merger itself. I think we should ensure we have the highest integrity in antitrust adjudication because they can have great impact.” Law isn't “crystal clear,” leaving “dangers of policy agendas getting embroiled in it,” he said. “It’s an important division that requires great integrity and ability, I believe, in the leadership at the antitrust division.” Lee, in a subsequent round of questioning, brought up antitrust again. “I’m not a member of the Antitrust Subcommittee,” Sessions replied, saying his expertise didn’t match that of other members like Lee and Subcommittee ranking member Amy Klobuchar, D-Minn. But his goal would be “to get it right,” he said. Sessions also declined to comment on a question from Lee about the role of the FTC in antitrust oversight.

Klobuchar asked former Attorney General Michael Mukasey Wednesday how the position is insulated from politics. “As soon as they take the oath, that’s their charge,” Mukasey told her. “They have to be supported in that by the department.” The public must have “justified public faith,” he added, saying it would be “very damaging” if otherwise. He said it’s a “rarity” to encounter political intervention in DOJ matters. That exchange occurred during Judiciary’s second session of its confirmation hearing for Sessions (see 1701090038).

DOJ Independence

Sessions “went out of his way to say he would be independent,” which could be seen as a “little bit contrary” to President-elect Donald Trump’s AT&T/TW opposition, said former Senate Antitrust Subcommittee general counsel Seth Bloom, who now lobbies for clients including Comcast and Yelp. Trump has said on the campaign trail that he wants to prevent approval of AT&T/TW. Bloom said much depends on who Sessions appoints to lead DOJ’s Antitrust Division, also noting the nominee’s answers suggesting he didn’t follow antitrust policy closely. Traditionally, a Republican appointed to the position may be inclined to have more laissez-faire and business friendly positions, but it’s possible a Trump administration could be more inclined toward “trust-busting,” Bloom said.

“There's only one answer to the question of political influence and Sessions gave it,” said Cowen and Co. analyst Paul Gallant. “But the reality for a long time has been that political influence is a factor at every department and agency.”

“I thought Senator Sessions’ answer was really very thoughtful,” said antitrust lawyer Allen Grunes of the Konkurrenz Group. “It signaled to me that he has respect for antitrust enforcement and the mission of the Antitrust Division. He said that antitrust issues are complex and as a result there is a risk that decisions can be politicized. I think that is right. I also agree with his conclusion that this means it is important to have good and capable leadership at the top with a lot of integrity.” Leadership affects enforcement and what cases to take on, Grunes said, stressing his belief DOJ should remain independent, sometimes taking controversial cases such as with Microsoft in the 1990s. “Nevertheless, I think it is fair to say that antitrust law does have some political content,” Grunes added. “Attempts to make antitrust completely apolitical are misguided. For instance, anyone who thinks that antitrust is purely about economics should look at the intense level of disagreement between highly respected economists when cases are litigated. Economics is not a magic wand or crystal ball that gives you the right answer. It is a tool like other tools.”

The political transition shouldn't affect the timing of AT&T/TW review, predicted Bloom. He suspects the new administration may have an antitrust chief chosen within a month or so of inauguration. “One would think it wouldn’t take too long,” he said of Senate confirmation for the antitrust division chief, citing the Republican Senate. He recalled at the start of the George W. Bush administration a delay for the position until June, but even such a delay in 2017 shouldn't affect review of the deal, he said. AT&T/TW review would likely take at least eight or nine months, and 90 percent or so of the work is done by career staff at DOJ, Bloom said.

Sessions’ many hours of testimony “further convinced me” that he is right for the job, Senate Judiciary Committee Chairman Chuck Grassley, R-Iowa, said Wednesday during the follow-up sessions. Several witnesses and lawmakers were divided on Sessions’ qualifications. Sen. Cory Booker, D-N.J., and Congressional Black Caucus Chairman Cedric Richmond, D-La., testified in opposition Wednesday.

Surveillance Chatter

Surveillance continued to occasionally emerge as an issue Wednesday.

Sen. Dick Durbin, D-Ill., pressed witnesses on hacking allegations involving Russia and the ability of a Trump attorney general to stop investigations at the request of the White House. Mukasey said investigations at DOJ “will be pursued” to a logical conclusion but admitted the president could stop one. He said he never received such a request. “The department would pursue its agenda as already set,” he said. Sessions “has also supported dragnet surveillance of Americans,” said American Civil Liberties Union Legal Director David Cole in his written testimony. Sen. Ted Cruz, R-Texas, attacked Cole for what he deemed one-sided testimony overall. Trump acknowledged Wednesday that Russia may be behind the elections hacks (see 1701110051).

Robyn Greene, policy counsel and government affairs lead for New America's Open Technology Institute, told us she was most troubled by the lack of questioning from senators about Sessions’ views on surveillance, encryption or Americans’ right to privacy. “He is really a man with extremist views when it comes to privacy,” she said. “He is very hostile to Americans’ Fourth Amendment rights.” Greene pointed to Sessions’ response to ranking member Sen. Pat Leahy, D-Vt., during Tuesday’s hearing when he asked the nominee about whether the USA Freedom Act prohibited bulk collection of Americans’ records. Sessions’ response was “wishy-washy and that is really concerning because this is a man who is about to take the helm of the Department of Justice,” said Greene. Republican committee members delivered “softball questions” while Democratic members were more focused on Sessions’ civil rights positions, which is pertinent but came at the cost of privacy issues, she said. Greene said there’s going to be “continued unrest about his nomination” and she hopes senators will seriously consider the constitutional rights of Americans when voting on Sessions.

“I recall working with [Sessions] on reauthorization of the Foreign Intelligence Surveillance Act in 2008, and hearing his views on the importance of this legislation and strategies for convincing legislators in both the Senate and the House to pass it,” Mukasey said Wednesday in his written testimony. “He showed a concern for this nation’s security and an understanding of how FISA helped protect it that I thought was uncommon even among engaged legislators.”