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Terrell McSweeny

Terrell McSweeny, former Commissioner of the Federal Trade Commission (FTC), has held senior appointments in the White House, Department of Justice (DOJ), and the U.S. Senate. At the FTC and DOJ Antitrust Division, she played key roles on significant antitrust and consumer protection enforcement matters. She brings to bear deep experience with regulations governing mergers and non-criminal, anti-competitive conduct, as well as issues relating to cybersecurity and privacy facing high-tech, financial, health care, pharmaceutical, automotive, media, and other industries. Terrell is internationally recognized for her work at the intersection of law and policy with cutting edge technologies including Artificial intelligence (“AI”), Digital Health, Fintech, and the Internet of Things (“IoT”). Clients benefit considerably from her extensive relationships with other enforcement agencies around the world.

Prior to joining the Commission, Terrell served as Chief Counsel for Competition Policy and Intergovernmental Relations for the U.S. Department of Justice, Antitrust Division. She joined the Antitrust Division after serving as Deputy Assistant to the President and Domestic Policy Advisor to the Vice President from January 2009 until February 2012, advising President Obama and Vice President Biden on policy in a variety of areas.

Terrell’s government service also includes her work as Senator Joe Biden’s Deputy Chief of Staff and Policy Director in the U.S. Senate, where she managed domestic and economic policy development and legislative initiatives, and as Counsel on the Senate Judiciary Committee, where she worked on issues such as criminal justice, innovation, women's rights, domestic violence, judicial nominations, immigration, and civil rights.

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On December 12, 2024, the U.S. Federal Trade Commission (FTC) authorized its staff to file a complaint against alcohol distributor Southern Glazer’s Wine and Spirits, LLC (“Southern Glazer’s”). The complaint alleges that the company engaged in price discrimination—charging higher prices to independent businesses and lower prices to large national and regional chains—in violation of Section 2(a) of the Robinson-Patman Act (“RPA”). The Commission voted 3-2 along party lines to file the lawsuit in federal district court, with the two Republican-appointed Commissioners—Commissioners Melissa Holyoak and Andrew Ferguson—issuing strongly worded dissenting statements (see here and here, respectively). Prior to this case, the federal antitrust agencies—the FTC and the Antitrust Division of the U.S. Department of Justice (the “Antitrust Division”)—had not brought an enforcement action under the RPA in more than two decades.

The Robinson-Patman Act:

According to the Supreme Court in Volvo Trucks N. Am., Inc. v. Reeder-Simco GMC, Inc.,546 U.S. 164, 175 (2006), Congress enactedthe RPA in 1936 to “target the perceived harm to competition occasioned by powerful buyers” in response to the advent of large chain stores. At the time, Congress was worried that large firms could extract lower prices from manufacturers or suppliers than smaller businesses. Id.

The RPA covers several categories of conduct. Most relevant here, Section 2(a) makes it unlawful for any person “engaged in commerce” to “discriminate in price between purchasers of commodities of like grade and quality” where the effect of such discrimination may be to lessen competition, tend to create a monopoly, or injure competition with any person who receives the benefit of such discrimination or their customers. There are several potential legal defenses to this provision, including that the price difference was justified by costs incurred by the seller, that the lower price was available to all customers, that the price differential did not cause the customer that paid a higher price to lose sales, and that the price difference was the result of meeting a competitor’s price.Continue Reading FTC Brings First Robinson-Patman Act Case in More Than Two Decades

July 10, 2024, Covington Alert

On July 3, 2024, Judge Ada Brown of the United States District Court for the Northern District of Texas granted the motions for a preliminary injunction—filed by Ryan LLC (“Ryan”) and several trade associations, including the U.S. Chamber of Commerce (“Chamber”)—to prevent the FTC’s rule banning non-compete clauses from going into effect, but the court’s order only applies to the named plaintiffs (i.e., it is not a nationwide injunction). The court has indicated that it will issue a final order on the merits by August 30, 2024, just a few days before the FTC’s rule is scheduled to go into effect on September 4. It is possible that Judge Brown enjoins the non-compete ban nationwide in her final order.

Background

In April, the FTC issued a final rule banning almost all non-competes with U.S. workers, with narrow exceptions, pursuant to its claimed authority to issue competition-related rules under Sections 5 and 6(g) of the FTC Act. That same day, Ryan challenged the FTC’s rule and, shortly thereafter, filed a motion to stay and preliminarily enjoin the rule, arguing that the FTC has no statutory authority to promulgate the rule, that the rule is the product of an unconstitutional exercise of power, and that the FTC’s acts were arbitrary and capricious. The Chamber and other trade groups intervened as plaintiffs on May 8, making substantially the same arguments.

The Order

In its Order, the court found that the Plaintiffs had demonstrated a likelihood of success that (1) the FTC does not have the statutory authority to engage in competition-related rulemaking, (2) the non-compete rule is arbitrary and capricious, and (3) the plaintiffs and intervenors had satisfied the standard to obtain injunctive relief.Continue Reading Texas District Court Enjoins FTC’s Rule Banning Non-Compete Clauses

On Monday, November 7, the Supreme Court heard argument in Axon Enterprise, Inc. v. FTC and SEC v. Cochran to decide whether a party subject to an FTC or SEC administrative proceeding can simultaneously challenge the constitutionality of an administrative proceeding, or even of the agency itself, in federal district court rather than waiting for final agency action.  At least five Justices expressed some measure of support for the private parties’ arguments, which indicates that the Court may permit certain kinds of collateral constitutional attacks (e.g., due process and appointments clause claims) at the outset of administrative proceedings.

Although predicting the outcome of any case from the oral argument is extremely difficult, three Justices – Neil Gorsuch, Samuel Alito, and Clarence Thomas – expressed strong support for finding in Axon’s and Cochran’s favor. Through their questions, they implied that 28 U.S.C. Section 1331, which grants federal district courts “original jurisdiction of all civil actions arising under the Constitution of the United States,” provides a clear grant of jurisdiction over constitutional claims and neither the FTC Act nor the Securities Exchange Act of 1934 (“the Exchange Act”) could strip district courts of that jurisdiction. They also suggested that Free Enterprise Fund v. PCAOB requires a finding for the companies. In PCAOB, the Court held that a district court had jurisdiction to hear an appointments clause challenge to PCAOB’s structure despite the fact that the SEC had not yet issued a final order against Free Enterprise Fund.

Other justices appeared to favor the private parties, but not as overtly. Chief Justice John Roberts’s questions suggested that PCAOB may prove to be an insurmountable barrier to the government’s claims and that the availability of jurisdiction in other forums (i.e., the court of appeals) under the FTC Act and the Exchange Act clearly does not act as an implied removal of jurisdiction from Section 1331. Justice Brett Kavanaugh’s questions indicated that he believes that the issue may be decided solely by reference to the “wholly collateral” factor of the Thunder Basin test, which courts have used to guide determinations about when a party may bring an Article III challenge to agency proceedings before those proceedings have concluded. Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (1994) (holding that the statutory review scheme of the Federal Mine Safety and Health Amendments Act of 1977 precludes a district court from exercising subject-matter jurisdiction over a pre-enforcement challenge to the Act). He stated that clarity, certainty, and speed counseled in favor of permitting district courts to hear constitutional claims.Continue Reading Supreme Court Considers Whether to Allow Early Constitutional Challenges to FTC and SEC Administrative Proceedings

The U.S. Federal Trade Commission issued a policy statement that dramatically expands the scope of what it considers “unfair methods of competition” under Section 5 of the FTC Act, 15 U.S.C. § 45. This represents an aggressive and unprecedented interpretation of the agency’s authority, and indicates that the Commission plans to use rulemaking and enforcement actions to police a broad set of conduct beyond the scope of the antitrust laws (i.e., the Sherman Act and the Clayton Act).

According to the agency’s press release, the policy statement – issued pursuant to a party-line vote of 3-1 – is intended to “restore the agency’s policy of rigorously enforcing the federal ban on unfair methods of competition” with the stated goal of allowing the agency “to exercise its full statutory authority against companies that use unfair tactics to gain an advantage instead of competing on the merits.” And Chair Lina Khan suggested that the agency will enforce Section 5 to “crack down on unfair methods of competition,” as commanded by Congress when it created the FTC.

The policy statement lays out two elements to a Section 5 violation: (1) the conduct must be a method of competition (2) that is unfair. Most of the action will be around the second prong – unfairness – which the policy statement defines as conduct that goes “beyond competition on the merits.” To determine whether the alleged conduct is fair or unfair, the Commission will evaluate two criteria on a sliding scale (i.e., the more evidence of one, the less the Commission believes that there is need for evidence of the other):Continue Reading The FTC Signals an Unprecedented Expansion in Its Definition of Unfair Methods of Competition

By Terrell McSweeny, Megan Crowley, Nicholas Xenakis, Alexandra Cooper-Ponte & Madeline Salinas on September 28, 2022

On September 16, the Fifth Circuit issued its decision in NetChoice L.L.C. v. Paxton, upholding Texas HB 20, a law that limits the ability of large social media platforms to moderate…

Continue Reading Fifth Circuit Upholds Texas Law Restricting Online “Censorship”

Tuesday, January 18th, the Federal Trade Commission (“FTC”) and the U.S. Justice Department’s Antitrust Division (“DOJ”) launched a joint public inquiry regarding the agencies’ horizontal and vertical merger guidelines. As part of this inquiry, the agencies are soliciting public comment via a Request for Information (“RFI”) on a wide range…
Continue Reading FTC, DOJ Announce Process to Revamp Merger Guidelines

COVID-19 has had a profound effect on supply chains, creating shortages and, in some cases, raising prices of vital medical and consumer products. It is no surprise that consumers, businesses, and government authorities are sounding the alarm about potential price gouging and pursuing those who appear to be exploiting the

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Continue Reading Federal and State Price-Gouging Enforcement in the Era of COVID-19