By Joe Light

One by one, President Joe Biden's agency heads have said they'll step down in time for President-elect Donald Trump's inauguration in January. The major exception so far: Federal Trade Commission Chair Lina Khan. Many analysts expect her to announce her resignation in coming weeks, but she could remain a thorn in her successor's side for as long as she chooses to stay.

Trump last week picked current commissioner Andrew Ferguson, a Republican, to chair the FTC. Trump also said that he would nominate antitrust attorney Mark Meador to replace Khan, whose spot on the commission expired in September.

Since Ferguson has already been confirmed by the Senate, his elevation to chair can be done with the stroke of a pen. However, confirming Meador could take the Republican-controlled Senate months to get around to, depending on which of Trump's nominations they prioritize.

Until Meador steps in, Khan is able to keep serving as a commissioner -- which would leave Ferguson in the unenviable position of presiding over a commission where he's in the minority.

While the chair in effect acts as the chief operating officer of the agency, setting the agenda for its thousands of employees, major decisions on rulemaking or on bringing or dropping litigation comes down to a vote by the five FTC commission members.

Biden's administration faced a similar quandary in 2021. On taking office, Biden designated Democratic commissioner Rebecca Slaughter to serve as acting chair, but for the five months until Khan was nominated and confirmed, the commission was split with two Democrats and two Republicans. The FTC had to wait until Khan's confirmation that June to take controversial votes that helped lead to the aggressive stance Khan took on antitrust issues.

An FTC spokesman declined to comment to Barron's on Khan's plans.

Ferguson won't be a total departure from Khan, who won fans in some conservative circles, including with Vice President-elect JD Vance. Both are in favor of antitrust action against tech giants, giving reason to believe that the agency will continue actions against companies including Amazon.com and Meta Platforms. A Republican-led FTC might pursue less aggressive penalties or breakups than a Democratic one would.

However, Ferguson and a GOP-controlled FTC will likely mark a big change on other issues. As commissioner, Ferguson has criticized Khan's opposition to mergers as "anti-business." He and other Republicans also opposed much of Khan's rulemaking agenda, such as the ban on most employment non-compete agreements.

If Khan decides to leave, Democrats will still have a tie on the commission until Meador's confirmation, but with a three to two majority, Democrats could technically advance votes on rulemaking or other actions even over Ferguson's objection, said George Washington University law professor Bill Kovacic. As a practical matter, Ferguson could make such actions logistically difficult, added Kovacic, a Republican who himself chaired the FTC for a year before being relegated to commissioner by President Barack Obama.

Even putting that possibility aside, as a commissioner Khan has a much bigger bully pulpit than she would have from outside the agency to speak out against actions to undo her time as chair. "The ability to influence events is much greater when you stay. You lose that audience the minute you walk out the door," Kovacic said.

Khan could still announce that she's leaving, and there are signs that she's racing to cement her legacy before Ferguson takes over. On Tuesday, the agency finalized a rule requiring hotels and ticket sellers to reveal "junk fees" upfront when consumers check out online. The agency last week also filed an antitrust lawsuit against a large alcohol distributor, alleging that it engaged in price discrimination.

Other rules that the agency has proposed, such as ones concerning data privacy and commercial surveillance, are still outstanding and could fall after the inauguration, says Beacon Policy Advisors analyst Owen Tedford. Many last-minute rules could ultimately be negated by the Republican-controlled Congress or the FTC once Republicans again have a majority.

"Our sense is she's trying to stick around to have as much influence as she can on these ongoing cases," Tedford said. "She'll lose that influence once she's not chair."

Write to Joe Light at joe.light@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

December 17, 2024 15:59 ET (20:59 GMT)

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