July 7 (Bloomberg) -- Christine Varney, the top antitrust official at the U.S. Justice Department, will leave her post next month to work for Cravath, Swaine & Moore LLP, a person familiar with the matter said.
Varney, 55, who has made her career in private practice and government in Washington, will work at the law firm’s New York headquarters, the person said.
“I’ve let the attorney general know I will leave Aug. 5 to return to private life and private practice,” Varney said yesterday in a phone interview, declining to comment on which firm she will join.
She said she plans some time off before taking her next position.
Varney, appointed by President Barack Obama in January 2009, vowed to step up antitrust enforcement as she came into the office in April of that year. One of her first moves was to retract Bush administration guidelines on monopolization policies, saying they “raised too many hurdles” to curbing anticompetitive practices.
“It’s been two and a half years, we’ve built a fantastic team and we have fulfilled President Obama’s commitment to reinvigorating the antitrust laws,” said Varney, a commissioner at the Federal Trade Commission from 1994 to 1997, appointed by President Bill Clinton. “It’s time to move on.”
Her replacement will selected by Attorney General Eric Holder and Obama, Varney said.
Varney’s departure comes amid the division’s review of AT&T Inc.’s proposed $39 billion purchase of T-Mobile USA Inc., which would create a new market leader ahead of No. 1 Verizon Wireless. A “strong team” will continue with the review, Varney said.
“No qualms about that,” she said.
Cravath has worked on some of the biggest antitrust cases, including the defense of International Business Machines Corp. against a government antitrust lawsuit filed in 1969.
A spokeswoman for the firm declined to comment on Varney.
The firm, which was founded in 1819, is the 10th-biggest adviser on mergers and acquisitions this year, according to data compiled by Bloomberg. Last year, Cravath represented UAL Corp., parent of United Airlines, in its merger with Continental Airlines Inc. to create the world’ largest carrier, a deal Varney approved.
During her tenure, the division sued American Express Co. over restrictions on merchants, as well as H&R Block Inc. to stop its purchase of the owner of TaxAct products and Blue Cross Blue Shield of Michigan for allegedly entering agreements that raised hospital prices.
The division’s threat of a lawsuit also caused Nasdaq OMX Group Inc. and IntercontinentalExchange Inc. to drop their bid for NYSE Euronext.
“She’s been more active than the previous administration and she has challenged a number of mergers the previous administration would have let go,” said Bert Foer, president of the American Antitrust Institute in Washington.
The Bush administration didn’t file a single monopolization case and the number of antitrust investigations dropped to an annual average of eight from an average of 12 during the Clinton administration, according to the American Antitrust Institute’s website.
Varney also promoted so-called behavioral remedies, under which deals were approved with conditions and an internal compliance monitor. Google Inc.’s $700 million purchase of ITA Software Inc., a maker of travel information software, is the most recent example.
After an eight-month review, the division on April 8 let the deal go through after Google agreed to make travel data available to search-engine rivals, set up firewalls to protect client information and let the government review complaints of unfair conduct.
The Google-ITA agreement allowed “the efficiencies of the deal” while “attempting to protect the innovation platform,” she said in an interview at the time.
Similar agreements included Comcast Corp.’s purchase of NBC Universal in January and Ticketmaster Entertainment Inc.’s merger with Live Nation Inc. in January 2010. Comcast had to follow safeguards to keep the largest U.S. cable company from restricting online video content and Ticketmaster was required to license its software to AEG Live, its largest customer.
“When you look at a merger, sometimes there’s a false dichotomy: either block it or let it go,” Varney said in the interview. “Complex transactions require complex solutions.”
Foer said there could be shortcomings to taking such a regulatory approach.
“Having a few attorneys from the Justice Department setting up with companies that have signed a consent order does not seem to be the best way to make public policy,” Foer said.
Varney’s enforcement actions in the health-care market were important for consumers, according to David Balto, a Washington-based attorney who has represented consumer groups.
“We finally had a healthcare cop on the beat,” Balto said. “She challenged mergers and anticompetitive conduct and that was crucial to trying to control healthcare costs.”
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