Nadler & Cicilline Demand Answers from WH & DOJ About Antitrust Investigation into Automakers Who Struck Vehicle Emissions Deal with CA
Washington, September 20, 2019
Tags: Regulatory Issues
Washington, D.C. – House Judiciary Committee Chairman Jerrold Nadler (D-NY) and Subcommittee on Antitrust, Commercial and Administrative Law Chairman David N. Cicilline (D-RI) sent a letter to the White House and Department of Justice about the Trump Administration’s antitrust investigation into automakers who reached an agreement with California regarding state emissions standards.
The letter is available here and below.
September 19, 2019
Mr. Pat Cipollone
Dear Mr. Cipollone and Assistant Attorney General Delrahim:
The House Judiciary Committee is examining allegations of obstruction of justice, public corruption, and other abuses of power by the President. We write to obtain information regarding President Trump’s latest apparent attempt to deploy the Justice Department’s legal antitrust authority for partisan political purposes—in this case against the State of California and automakers with which it has reached an emissions agreement. The Department’s dedication of resources to obstruct California’s and these automakers’ efforts to protect the environment appears to be yet another example of the Administration’s weaponization of the antitrust laws for political purposes. The potential abuse of the Department of Justice’s enforcement authorities to target perceived political adversaries of the President are of significant interest to the Committee.
According to recent reports, the Justice Department initiated an antitrust investigation into the four automakers that reached an agreement with California on the state’s heightened limits for greenhouse-gas vehicle emissions—Ford Motor Co., Volkswagen AG, BMW AG, and Honda Motor Co. The state’s limits are at the center of a growing political conflict between the Trump Administration and California’s efforts to combat climate change through stricter emissions standards than those supported by the Administration. This decision by the Department comes only a few weeks after it was reported that President Trump was “enraged by California’s deal” and after President Trump attacked publicly the State of California and the automakers on social media. In a further possible abuse of executive power, the President announced this week that he is revoking California’s decades-old authority to set more aggressive emissions standards than those issued by the federal government.
We are concerned the Department’s investigation is no more than a pretextual attack by the Trump Administration on the four automakers’ legitimate use of the governmental process. As Assistant Attorney General Delrahim acknowledged before the Senate Judiciary Committee this week, the Department cannot point to any evidence of an anticompetitive agreement in support of its investigation. On this point he testified, “I have nothing, that’s the purpose of an investigation.”
Importantly, in the 1960s, the Supreme Court struck a balance between the interests of antitrust law and the First Amendment right to free speech. The Supreme Court’s Noerr-Pennington doctrine provides a limited antitrust exemption for companies, even competitors, to jointly petition or urge government action. According to reports, it appears that the four automakers were engaged in just this type of protected activity. Conversely, according to reports, the President’s personal grievances remain the primary driving force for the Administration’s decisions related to the State of California:
Mr. Trump went so far as to propose scrapping his own rollback plan and keeping the Obama regulations, while still revoking California’s legal authority to set its own standards, according to the three people familiar with the meeting. The president framed it as a way to retaliate against both California and the four automakers in California’s camp, those people said.
As we have previously made clear, any political abuse of the Department’s antitrust enforcement power is unacceptable. Antitrust enforcement must be conducted in accordance with the rule of law, never wielded as a political weapon to retaliate against perceived political enemies of the President. This is particularly shocking where it appears that a state representing approximately 40 million people and a set of important individual companies are being targeted for simply participating in the political process.
To date, the Justice Department’s responses to concerns about political interference with the Department’s antitrust law enforcement activities have been insufficient, untimely, and incomplete. For example, requests for documents and information about allegations that President Trump improperly interfered with the Department’s review of AT&T’s acquisition of Time Warner were included in a series of letters, beginning in February 2018, but the Department did not respond until a year and a half later on July 5, 2019. Furthermore, it appears that key documents were inappropriately withheld or heavily redacted on the basis of executive privilege.
In its July 2019 response, the Justice Department stated that “each antitrust decision must be made on the merits based on the law and the available facts and evidence, and the Department shares [our] view that politics has no place in such a determination.” Last year, in a May 2018 response, the Department stated that it is “committed to ensuring” that “political considerations do not influence the handling of particular investigations or cases,” and that “all investigations conducted by the Antitrust Division are initiated and conducted in a fair, professional, and impartial manner, without regard to political considerations.” And only this week, Assistant Attorney General Delrahim again claimed within the context of the automakers investigation that “I am not doing this for political reasons.” We are extremely disturbed that the Justice Department’s rhetoric does not appear to match up with reality. Even the appearance of White House interference in antitrust law enforcement matters undermines public trust in the Department of Justice’s integrity and calls into question meritorious enforcement by the Antitrust Division. The fact of actual interference would of course constitute a serious abuse of power.
In light of these recent reports, we request you provide more responsive answers to our earlier letters referenced in footnote 11 and provide responses to the following questions and document requests no later than October 2, 2019.
1. Documents and communications between President Trump or officials or employees of the Executive Office of the President and the Department of Justice relating to the Department of Justice’s investigation into alleged antitrust violations by Ford Motor Co., Honda Motor Co., BMW AG, Volkswagen AG, and any other entity, in connection with an agreement to follow California auto emissions standards (the “Investigation”).
2. Documents and communications relating to President Trump, the Office of Attorney General, or the Executive Office of the President’s involvement in the Investigation, including but not limited to the decision to initiate the Investigation in the first place.
3. Documents and communications relating to any communications by the President concerning Ford Motor Co., Honda Motor Co., BMW AG, and Volkswagen AG’s agreement to follow California auto emissions standards.
4. Documents and communications relating to the President’s dispute or disagreement with the State of California’s position on the auto emissions standards.
5. Please identify the number of attorneys and number of attorney hours that the Antitrust Division has devoted to the Investigation from the date the Investigation was initiated to the present.Thank you for your prompt attention to this request.
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