Divining trends in antitrust enforcement in a given presidential administration can take some time. Many commentators didn’t notice material changes in antitrust enforcement in the Obama administration – at least in merger enforcement – until the summer of 2011, when the Antitrust Division of the Department of Justice (DOJ) brought suit challenging AT&T’s acquisition of T-Mobile, more than two years into President Obama’s term. However, in the early tenures of antitrust enforcers appointed by President Trump, there are indicators worth watching to see whether and to what extent they are harbingers for antitrust enforcement.

At the DOJ, newly appointed Assistant Attorney General (AAG) Makan Delrahim has provided some clues about how the DOJ under his leadership will approach antitrust issues at the intersection of antitrust and intellectual property, merger enforcement and the DOJ’s use of consent decrees generally. At the Federal Trade Commission (FTC), the direction of change will be less certain until a Trump nominee has been confirmed.

AAG Delrahim was nominated in late March 2017 and assumed office, following confirmation by the Senate, in late September 2017. In this fairly short period as AAG, Delrahim has already announced a few important changes in enforcement priorities at the DOJ. Befitting his status as the first registered patent lawyer to head the Antitrust Division, one of Delrahim’s first public speeches about the DOJ’s enforcement priorities touched on the role of antitrust law in the context of standard setting organizations (SSOs) and their policies regarding patents. Delrahim expressed concern that antitrust enforcers had strayed too far in the direction of accommodating the concerns of technology implementers over IP creators. Rather than focus on the patent ‘hold up’ problem, in which an IP licensor threatens to delay licensing until its royalty demands are met, Delrahim said that the more serious impediment to innovation is the ‘hold out’ problem, which arises where technology implementers underinvest in the implementation of a standard, or threaten not to take a license, until their royalty demands are met. Delrahim expressed skepticism about using antitrust law to address the hold up problem, noting that common law and non-antitrust statutory remedies are adequate remedies for SSOs and their members. Interestingly, while the DOJ had issued an influential business review letter regarding an SSO’s revised patent policy in 2015, during and prior to the Obama administration, the FTC had been more active than the DOJ in using the antitrust laws to address SSO issues. However, the AAG has a significant bully pulpit on any issues involving antitrust, even if the law continues to develop outside of the DOJ’s purview (e.g., in private actions).

In perhaps the most notable action taken in Delrahim’s tenure, the DOJ challenged AT&T’s proposed $85.4 billion acquisition of Time Warner. In the Obama administration, a few vertical deals (transactions between parties in the same value chain), including Comcast’s acquisition of NBC Universal, were approved subject to behavioral remedies prohibiting, among other things, discriminatory and retaliatory behavior and practices. Delrahim, in a November 2017 speech at the ABA Antitrust Fall Forum, expressed skepticism about behavioral remedies, saying that they supplant competition with regulation, require companies to make decisions contrary to their profit-maximizing incentives and demand more ongoing monitoring than structural decrees. Additionally, Delrahim noted that the DOJ has found it difficult to enforce behavioral remedies given the “exacting standards of proving contempt.”

Less than a week after the speech, the DOJ challenged AT&T/Time Warner, reportedly after rejecting an 11th-hour behavioral settlement offer from AT&T, marking the first time the DOJ (or the FTC) has challenged a vertical deal in decades. Delrahim’s statement on behavioral remedies reflected a view that may have been crystallizing at the DOJ regarding the difficulty of enforcing behavioral remedies. Notably, President Trump made a statement during the campaign that his administration would block AT&T/Time Warner. However, it is quite possible that a DOJ in a hypothetical Hillary Clinton administration may have reached the same result. Neither the DOJ’s vertical theory of harm asserted in AT&T/Time Warner nor the disfavoring of behavioral remedies are novel viewpoints. What remains to be seen is how Delrahim’s skepticism of behavioral remedies will affect other vertical mergers the DOJ is reviewing. The disfavoring of behavioral remedies could lead to an increase in challenges to vertical deals, or it could lead to more vertical deals being allowed to proceed without any conditions (or a challenge). Given the idiosyncratic context of AT&T/Time Warner and the recency of Delrahim’s speech, it would be prudent to see how the DOJ approaches similar vertical transactions in the future before drawing too many conclusions.

While AT&T/Time Warner provides some clues as to how the Trump era antitrust enforcers will approach vertical transactions, there is less evidence about how the DOJ or FTC may change antitrust enforcement towards horizontal transactions, which, of course, leaves room for speculation. In the latter years of the Obama administration, many observers saw at least two major changes in the substantive standard used to weigh whether transactions would substantially lessen competition. The enforcement agencies were (1) lowering the concentration thresholds at which they decided to intervene in a transaction; and (2) giving less credit to parties’ efficiency arguments. Additionally, the enforcement agencies were seen as requiring more stringent remedies, e.g., by trending towards favoring the divestiture of entire operating units rather than more limited products and by taking a stricter view of financial viability of divestiture buyers. It remains to be seen which of these enforcement trends will be reversed in a Trump administration.

In the same speech about behavioral remedies, Delrahim provided some general thoughts about the DOJ’s approach to consent decrees. He said that settlements should be simple and administrable, should avoid usurping regulatory functions and should preserve economic liberty and preserve the competitive process. He signaled an intention to improve the enforceability of consent decrees, mentioning a new provision that the DOJ will seek to put in decrees in which parties will agree that alleged violations will be judged under a preponderance standard, rather than the more rigorous contempt standard. The DOJ included such a provision in its recent Entercom/CBS decree. Delrahim also said that the DOJ will be seeking agreement on obtaining costs of ongoing monitoring and enforcement of decrees.

As no Trump FTC nominee has yet been confirmed, the direction of potential change is not yet as evident at the FTC. But acting FTC Chairman Maureen Ohlhausen has announced her intention to streamline the FTC’s information requests during its investigations, and it’s likely that Joe Simons, if and when confirmed as Chairman, will continue that approach. In a speech at the American Bar Association’s Antitrust Fall Forum in November 2017, Donald Kempf, the Antitrust Division’s Deputy Assistant Attorney General for Litigation, made a similar pronouncement that the DOJ would also seek to reduce the burden on parties involved in investigations.