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New Administration, Same Troubling FTC Policies

Obama era Federal Trade Commission filed an 11th hour lawsuit that put intellectual property rights in danger. Now the Trump FTC is continuing the same ill-conceived policies.

FTC Chair Maureen Ohlhausen

In a surprising move, the Federal Trade Commission (FTC) under President Trump is carrying out a last-minute lawsuit filed by the outgoing chair under President Obama. The result could benefit one of the world’s largest companies while infringing on the intellectual property rights of one of its suppliers:

[A] mere three days before to the inauguration of President Trump, then-Federal Trade Commission (FTC) Chairwoman Edith Ramirez filed suit against the technology company Qualcomm because she didn’t like the contracts it had negotiated with computer giant Apple (a company 10 times as large as Qualcomm). Shortly after Chairwoman Ramirez filed her midnight litigation, she quit her job to let others pick up the shattered pieces caused by her hubris.

Former Chairwoman Ramirez’s lawsuit is indicative of the regulatory agenda employed by the previous administration. For eight years, we watched as governmental agencies increasingly infringed on the ability of industries and businesses to flourish. If allowed to proceed, her suit will endanger intellectual property protections and put free market principles at risk.

For its part, the Obama administration has demonstrated a history of favoritism toward Apple. The previous administration’s leniency on Apple includes an episode from 2013 in which Obama’s U.S. trade representative allowed an import ban that adversely affected Apple rival Samsung.

While Obama’s favoritism toward Apple is well established, what’s more puzzling is the Trump FTC recommending Apple’s lawsuit against Qualcomm to continue. For all of Trump’s bluster about creating jobs, the FTC’s decision could put millions of jobs and trillions in GDP at risk is baffling:

The risk this lawsuit poses is not to just one company but to our nation’s ability to maintain our global competitiveness and position as a technology leader. This suit establishes a clear path for foreign governments to utilize frivolous enforcement actions to strip patent rights from U.S. companies, ultimately allowing Chinese, South Korean and European governments to use our own strength against us.

If allowed to move forward, the FTC’s midnight litigation will limit our country’s ability to innovate, stimulate the economy and create jobs. Considering that IP-related industries accounted for 27.9 million jobs and contributed $6.6 trillion to GDP in 2014, according to a report from the U.S. Patent and Trademark Office, there is much at stake.