Obama’s ‘secret weapon’ on antitrust leaves Justice

Gene Kimmelman, known as the Justice Department’s “secret weapon” on antitrust, is leaving the agency to open the Washington, D.C., office of the human rights organization Global Partners and Associates, current and former federal officials say.

Since his appointment in August 2009, Kimmelman has kept a relatively low public profile but has been one of the department’s most influential antitrust policy makers. Some liberals say Kimmelman helped revitalize a division that had grown soft under President George W. Bush. But industry officials and some conservatives say the department’s recent antitrust actions exemplify the Obama administration’s lack of business understanding.

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Working from a heavy wooden desk once used by J. Edgar Hoover, Kimmelman, 57, was a driving force behind Justice’s rejection of AT&T’s $39 billion bid for T-Mobile in November, a defining moment for the administration’s efforts to police the rapidly shifting high-tech and communications sectors.

As a chief counsel in Justice’s antitrust division, Kimmelman also helped lead its approval of Comcast’s joint venture with NBC Universal — a controversial mega-merger that was granted but with a litany of conditions to protect competition from online firms as well as consumer cable and Internet costs.

Kimmelman declined to comment for this story. The Justice Department confirmed his departure, but declined to comment further.

Before joining Justice, Kimmelman spent more than 30 years as a consumer advocate on technology and telecommunications issues at Consumers Union, an advocacy group that also publishes Consumer Reports, and served as chief counsel for the antitrust subcommittee of the Senate Judiciary Committee. With that experience, Kimmelman was a rarity in Washington: a veteran technology wonk with no ties to the private sector.

That’s partly what led the Obama administration’s former antitrust chief Christine Varney to pick Kimmelman as a senior adviser. She described him as a “top confidant” in her efforts to ramp up the antitrust enforcement of technology and media companies, such as Apple, Google, Comcast, AT&T and Verizon, as they broadened their dominance. He also worked on financial services and health-care matters.

“He took on a lot and is one of the smartest lawyers I know,” Varney said in an interview. “He was able to understand very complex markets and also see ahead.”

Inside the Justice Department, Kimmelman became known for his extensive network of connections, including powerful figures on K Street as well as within the White House, the Federal Trade Commission and Federal Communications Commission.

“Gene was very important and played a critical role in ensuring consumer welfare was at the forefront of decision making,” said Sharon Pozen who served as the interim replacement for Varney until last April. “Gene knows ­everyone in Washington, he is like a consigliere.”

Kimmelman’s departure may bring a sigh of relief to some high-tech and telecom companies. Some executives bristled at Justice’s appointment of an outspoken proponent of antitrust regulations.

Kimmelman, for instance, advocated to bring Apple and several e-book publishers to court for alleged price fixing. Critics say the case, while punishing Apple and the publishers, would only cement the dominance of Amazon, which offers e-books at an extreme discount to boost sales of its Kindle device. In essence, critics say, Justice is picking winners and losers in a fast-emerging business.

When these concerns were raised in meetings with the ­defendants involved in the suit, Kimmelman wouldn’t budge, people familiar with the talks said.

Kimmelman has been working on a probe of traditional cable firms, which allegedly are trying to suppress competition from online video providers such as Netflix and Hulu. He also has been a key figure in a probe of a cross-marketing deal between Verizon and the nation’s leading cable companies.

But some industry observers said that Kimmelman didn’t end up as rigid as some executives had feared.

Kimmelman was involved in the agency’s approval of Comcast’s joint venture with NBC Universal and a merger between entertainment venue firms Ticketmaster and LiveNation. Both deals generated protests from lawmakers and consumer groups. Justice extracted promises from the companies that they would not stymie future competition from Internet firms or harm consumer prices.

Perhaps the most memorable action of Kimmelman’s time at Justice was the rejection of the merger between AT&T and T-Mobile. The companies had promised to create thousands of new jobs if they were allowed to combine.

Kimmelman drew from his consumer advocacy roots, Varney said. He brought in public interest groups to discuss how the deal would affect consumers, “which was unheard of previously at the DOJ,” Varney said.

Kimmelman was familiar with AT&T. While at the Consumer Federation of America more than 30 years ago, his first policy job, Kimmelman advocated for the government’s landmark breakup of the corporation.

He will join the London-based Global Partners on July 20 and lead the group’s educational programs, which use Internet technology and communications platforms to promote global free speech and human rights.

 
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