Illumina, Inc. v. FTC

In 2020, a biotechnology company named Illumina, Inc., acquired Grail, Inc., the developer of an early-detection cancer test. The Federal Trade Commission (FTC) investigated the merger, conducted adversarial adjudicatory proceedings, and concluded that the merger could substantially lessen competition in the relevant market for research and development of early-stage cancer testing, which would potentially inhibit the creation of effective and affordable medical technologies. The FTC accordingly issued a cease-and-desist order requiring the companies to unwind the merger.

In a petition for review of the FTC’s order filed in the Fifth Circuit, the companies challenged the FTC’s order on two theories: First, it argued that a statutory provision protecting FTC Commissioners from being removed without good cause unconstitutionally curtailed the President’s authority to execute federal law. Second, it argued that the FTC’s adjudicatory proceedings violated due process because they were conducted within the same agency that had investigated the case.

Public Citizen filed an amicus brief urging the court to deny the petition for review. The brief explained that a 1935 Supreme Court opinion, Humphrey’s Executor v. United States, considered and rejected the same constitutional challenge to the FTC Commissioners’ tenure protections that the companies raised, and also that the companies had not shown that the agency would have acted differently had its Commissioners been subject to at-will removal by the President. As for due process, the amicus brief explained that the Supreme Court has long held that Congress’s decision to repose investigative and adjudicatory authority within a single agency does not violate due process, absent evidence that the combination of functions leaves the agency incapable of impartial adjudication. The companies here produced no evidence suggesting that FTC adjudicators are institutionally biased against regulated parties as a general matter or that the Commissioners who issued the challenged order displayed any bias in this particular case.

The Fifth Circuit rejected the companies’ constitutional arguments, holding that the Commissioners’ removal protections did not unconstitutionally impinge on the President’s authority and that the combination of prosecutorial and adjudicatory functions within the FTC did not violate due process. The court nonetheless ordered that the FTC order be vacated because the court concluded that the FTC had applied the wrong antitrust standard when adjudicating the challenged merger.