With the departure of now former Chair Edith Ramirez in early February 2017, among the most discussed vacancies in the new administration is the post of permanent chair of the Federal Trade Commission (FTC). According to reports, one leading candidate is Acting Chair Maureen Ohlhausen, whose selection could have significant implications for FTC policy areas, particularly with respect to disgorgement remedies in antitrust cases. Specifically, should she become the permanent chair, Ohlhausen's record and recent comments indicate a potential shift away from disgorgement as a remedy in FTC cases.

From the beginning of her tenure as commissioner, Ohlhausen has been an outspoken critic of the FTC's pursuit of disgorgement remedies in the vast majority of antitrust cases. In 2012, when the FTC voted to withdraw its Policy Statement on Monetary Remedies in Competition Cases which had articulated a three-part standard under which the FTC would ordinarily not seek disgorgement absent a clear violation of the antitrust laws then-Commissioner Ohlhausen issued a statement dissenting from the decision. In her statement, she explained that she had "significant concerns" about sending a signal that:

"the Commission will be seeking disgorgement in circumstances in which the three-part test… is not met, such as where the alleged antitrust violation is not clear or where other remedies would be sufficient to address the violation".(1)

In the wake of this policy shift, Ohlhausen has continued her criticism as the FTC sought disgorgement in five cases since 2012,(2) more than it did during the previous nine years during which the policy statement was in effect.(3) In addition to concerns regarding transparency, she emphasised that in its pursuit of disgorgement (which can be obtained only in a federal court), the FTC "neglect[ed] its special mission to develop the antitrust laws through Part III litigation and other unique tools".(4) In the specific situation of pay-for-delay cases, Ohlhausen described that it is an "unfortunate mistake" for the FTC to "look past Part III for monetary relief reasons".(5) Thus, Ohlhausen indicated a preference to pursue cases in Part III, meaning that disgorgement and other monetary relief would not be a priority for the FTC in such matters.

On the other hand, disgorgement remedies may not disappear entirely under an Ohlhausen-led FTC. She has supported the pursuit of disgorgement in two cases during her tenure, including Cephalon in 2015 and most recently in a case alleging that Shire ViroPharma had violated the antitrust laws by making "repetitive, serial, and meritless filings to the [Food and Drug Administration (FDA)] and courts" to delay the FDA's approval of generic Vancocin capsules.(6) In the context of Cephalon, then-Commissioner Ohlhausen issued a separate statement together with then-Commissioner Joshua Wright explaining that they believed disgorgement was appropriate in that case because the allegations met the three-part standard under the (then-withdrawn) policy statement namely, that the alleged violation was "clear" because "there is reason to believe that Cephalon should have known that it was violating the antitrust laws" and there was also a reasonable basis for calculating the disgorgement amount. Although Ohlhausen did not issue a statement in connection with the Shire complaint, her endorsement of seeking disgorgement against Shire is consistent with views that she expressed in the context of Cephalon. Regardless, using the Part III process would avoid disgorgement in such cases altogether.

Against this well-established track record, should she be confirmed as the permanent chair, Ohlhausen's leadership may drive a significant policy shift on disgorgement, including the potential reissue of the policy statement and a transition away from federal court litigation to Part III administrative activity. While these changes could have significant implications for a wide range of companies, they may have the greatest impact on the pharmaceutical industry, which has been a primary enforcement priority for the FTC for some time and has also been the target in every case in which the FTC has sought disgorgement since 2012.

For further information on this topic please contact Logan M Breed or Lauren E Battaglia at Hogan Lovells US LLP by telephone (+1 202 637 5600) or email ([email protected] or [email protected]). The Hogan Lovells US LLP website can be accessed at www.hoganlovells.com.


(1) Statement of Commissioner Maureen K Ohlhausen Dissenting from the Commission's Decision to Withdraw its Policy Statement on Monetary Equitable Remedies in Competition Cases, July 31 2012.

(2) FTC v Shire ViroPharma Inc, No 1:17-cv-00131-UNA (D Del February 7 2017); FTC v Endo Pharma, No 2:16-cv-1440 (ED Pa March 30 2016); FTC v Cardinal Health, No 15-cv-3031 (SD NY April 20 2015); FTC v AbbVie, Inc, No 2:14-cv-05151 (ED Pa September 8 2014); FTC v Cephalon, Inc, No 2:08-cv-2141 (ED Pa November 18 2013).

(3) While the policy statement was in effect, the FTC pursued disgorgement in only two cases: FTC v Ovation Pharmaceuticals, Inc, Civ No 08-6379 (D Minn December 16 2008) and FTC v Perrigo Company, No 1:04-cv-01397 (DDC August 12 2004).

(4) Speech by Maureen K Ohlhausen, commissioner, FTC: "Dollars, Doctrine, and Damage Control: How Disgorgement Affects the FTC's Antitrust Mission", April 20 2016.

(5) Id.

(6) Complaint, FTC v Shire ViroPharma Inc, No 1:17-cv-00131-UNA (D Del February 7 2017) at Paragraph 143.