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FTC-DoJ split: Not a done deal

Senate Commerce Committee Chairman Fritz Hollings (D-S.C.) and Federal Trade Commission Chairman Timothy Muris remain at a stand-off over the FTC's decision to give the Department of Justice authority over all media and telecommunications mergers.

While both sides say their staffs are meeting, Hollings and Muris have not met. Hollings' staff says that is because the chairman is too busy, while Muris' staff says it is because Muris has continually asked for a meeting and been given the cold shoulder by Hollings.

Meanwhile, FTC staffers are being asked to give Senate Commerce Committee staffers more details and documents over terms of the FTC's deal with Justice. The committee also is doing a cost-analysis study on the FTC's budget and salaries to determine whether high-level positions should be cut, says a committee spokesman.

Despite that pressure, neither side says the FTC has indicated it is backing off the deal it made with DoJ, though negotiations are continuing.

"We are eager to provide information and respond to requests," says Cathy MacFarlane, FTC spokeswoman. But, she added, since no meetings have yet been held and no concrete suggestion has been provided by the Commerce Committee, it is difficult to say how the FTC plans to respond.

Commerce Committee staffers say they are looking at several options and hope to have a decision by June, which is when the Senate Appropriations Subcommittee, also headed by Hollings, will write legislation that includes the FTC's budget.

Meanwhile, Hollings is being decidedly more critical of Muris and the FTC than his staff. Several times Hollings has said he wants to cut key FTC budgets and personnel—and even Muris himself—in an attempt to force Muris to change course.

"Senator Hollings has serious doubts about how this plan [between DoJ and the FTC] was derived. We're looking at a variety of options," says Commerce Committee spokesman Andy Davis.

But Davis also points out the not so obvious, in light of Hollings' recent comments: "The FTC has had a strong advocate in Sen. Hollings over the years. But he feels that the DoJ's and the FTC's joint jurisdiction over merger reviews exists for a reason. The FTC provides a broader view of how the consumer is affected."

In response to indications that Hollings is looking to deplete his budget, Muris last week said any such cuts would "eliminate the commission's ability to enforce the laws under its jurisdiction. If Senator Hollings were to succeed in eliminating the commissioners' salaries, the agency would have no legal authority to move forward with its responsibilities, including its rulemaking, investigative and law-enforcement functions."

Any legislative attempt by Hollings to cut the FTC's budget and salaries would have to be passed by the entire Congress and signed into law by President Bush, which is unlikely. Still, by taking the feud public, Hollings is forcing Muris to deal with him in public, making for an uncomfortable situation for the Republican FTC chairman.

The feud between Hollings and the FTC began last January, when the DoJ and the FTC planned to announce they had divided merger authority over various industries between them, with authority over all media and telecommunications companies going to Justice's Antitrust division. Charles James, chief of DoJ's Antitrust division, and Muris postponed the Jan. 17 announcement after Hollings, Democratic FTC Commissioner Mozelle Thompson and consumer-advocacy groups complained.

The plan was resurrected and announced March 5, still without Hollings' blessing. Muris then was confronted with the unpleasant task of facing Hollings during the FTC's appropriations hearing on March 19. It was during that hearing that Hollings threatened to cut Muris' budgets and staff, as well as singled out Muris for personal criticism.

At and after that hearing, Muris said he would not back off the plan merely because Hollings was unhappy.