September 19, 2006

Research Shows Law Would Force Majoras to Recuse on some FTC Oil, Gasoline Cases

Wyden releases CRS report, says waiver of rules for Majoras wouldn't eliminate potential conflicts, assure advocacy for consumers

Washington, DC - U.S. Senator Ron Wyden (D-Ore.) today released research from the nonpartisan Congressional Research Service (CRS) indicating that Federal law would require Deborah Majoras, the current nominee to chair the Federal Trade Commission (FTC), to recuse herself from some oil and gasoline industry issues coming before the Commission. Majoras has personally represented the oil giant ChevronTexaco as outside counsel in the last year; according to CRS, such a "past association" requires an official's recusal from any cases involving that company for one year. Moreover, a current economic interest - which in Majoras' case is her spouse's continued partnership in the same law firm that represents ChevronTexaco - would require either recusal or an "express waiver" of the rules to allow her further participation in such cases. This has special ramifications for the hard-hit West Coast gasoline market because of ChevronTexaco's major presence there. "I expect the next chair of the Federal Trade Commission to immediately get in the game on the issue of gasoline prices, and this nominee has significant and ongoing conflicts of interest regarding one of the nation's biggest oil companies," said Wyden. "It would not be enough for the FTC ethics officer to waive the rules and let Ms. Majoras participate. That would not eliminate the conflict, nor would it increase the likelihood that Americans paying astronomical gas prices will finally get the true advocate they need in this post." CRS found that a presidential appointee "must recuse from any ‘particular matter' which may directly and predictably impact an entity in which the official, the official's spouse or dependent children have a current financial interest," and from "‘particular matters involving specific parties' if the official's impartiality may be questioned, when the official had represented or acted as the attorney for the private party during the previous one-year period." The report, which follows this release, comes at a time when gasoline prices remain at near-historic highs across the country and when research shows that oil company mergers allowed by the FTC have contributed to those high prices. As oil companies continue to post record refinery margins and profits, documented anti-competitive practices are raising prices even further at the pump - particularly in the Pacific Northwest. Wyden has already publicly placed a "hold" on Majoras' nomination as FTC chair, due to her inability to present concrete initiatives to change the FTC's long history of inaction on anti-competitive practices in the oil industry and in oil and gasoline markets. Wyden has long urged the FTC to use its existing authority to crack down on practices that force gasoline prices higher for American consumers; however, the agency has consistently failed to do so. Wyden says he will not allow the confirmation of another FTC chair until that person demonstrates specific intentions to stand up for American consumers on gasoline pricing issues.