Top U.S. Antitrust Official to Resign

The U.S. Justice Department’s top antitrust official said Tuesday that he would resign next month, leaving key decisions -- including two pending phone company mergers -- for a successor.

As assistant attorney general in charge of federal antitrust enforcement for more than two years, R. Hewitt Pate emphasized criminal prosecution of companies and executives accused of price fixing and other illegal behavior rather than pursuit of lawsuits over monopolistic behavior.

Atty. Gen. Alberto R. Gonzales called Pate “a strong enforcer of our nation’s antitrust laws.”

Despite his high-profile role, Pate drew little controversy. “He was not a big risk-taker,” said University of Iowa antitrust law professor Herbert Hovenkamp. “I think he will go down as a successful, very effective administrator -- not one who really reached out and embraced new causes of action.”

Pate, 42, brought in $717 million in fines in dozens of prosecutions, department officials said, including a $185-million penalty against South Korea’s Hynix Semiconductor Inc. in an investigation of price fixing in the memory-chip market.

Pate did take on some significant litigation, including an unsuccessful attack on Oracle Corp.’s hostile takeover of rival PeopleSoft Inc. Experts said that merger was reasonable to oppose, even if the case fell apart as unanticipated facts emerged at trial.

Among proposed mega-mergers he was able to stop was a plan by EchoStar Communications Corp. to buy the other major U.S. satellite television provider, DirecTV parent Hughes Electronics Corp., now known as DirecTV Group Inc.

“Those types of transactions were fairly classic mergers to oppose,” that most antitrust regulators would fight, said Akin Gump Strauss Hauer & Feld lawyer Charles Biggio, an antitrust official in the Clinton Justice Department.

Pate also defended challenges to the department’s settlement with Microsoft Corp., negotiated by a predecessor, and he took the unusual step of criticizing his European counterparts for pursuing stiffer penalties against the software giant.

Some of Pate’s more lasting contributions might be in limiting the ability of those outside government to pursue antitrust claims, said Howard University law professor Andrew Gavil.

In one such case, the department squelched a consumer suit against Verizon Communications Inc. for failing to give AT&T; Corp. reasonable access to its customers.

In another, the department helped persuade the Supreme Court to bar foreign companies, including Ecuador-based Empagran, from seeking triple damages against Hoffman-LaRoche and other companies for price fixing on vitamins sold overseas.

Pate’s departure means a successor will be left to weigh SBC Communications Inc.’s pending takeover of AT&T; and Verizon’s acquisition of MCI Inc.

Smaller competitors and consumer groups oppose both mergers because they would give SBC and Verizon near-total control of land-line service in their territories, as much as 45% of the market for corporate and government clients and a big chunk of the Internet backbone that moves voice and data signals.

Such control, without strong oversight and stringent conditions imposed by regulators, would allow the Bell operating companies to run smaller rivals out of business and raise prices indiscriminately, critics said.

Times staff writer James S. Granelli contributed to this report.