Microsoft is asking the FTC Inspector General Andrew Katsaros to investigate whether FTC personnel leaked news of the agency’s potential antitrust investigation into the company.

Bloomberg broke a story in late November that the FTC was launching an antitrust investigation into Microsoft’s cloud computing licensing practices. According to Rima Alaily, Microsoft Head of Competition and Market Regulation Team, the company found out about the investigation via the news, and has still not received any official acknowledgment from the FTC.

Alaily goes on to say the FTC’s actions fit a pattern of behavior, in which the agency admits a pattern of “unauthorized disclosures.”

If true, Alaily’s allegations paint a disturbing picture of the FTC, one that undermines the agency’s credibility in this and any future investigations.

Alaily’s letter is copied in full below:

“Dear Inspector General Katsaros,

“On November 27, 2024, Bloomberg News reported that the Federal Trade Commission (FTC) had “opened an antitrust investigation” of Microsoft spanning “cloud computing and software licensing bundles to cybersecurity offerings and artificial intelligence products.” The report further described an information demand issued to Microsoft “hundreds of pages long.” This type of information as well as references in the story to “people familiar with the information request” strongly suggests that the details included in Bloomberg’ story comes from within the FTC.

“I ask you to investigate whether FTC management improperly leaked this confidential information to the press in violation of the agency’s ethics rules and rules of practice. Ironically, almost a week after telling the press about an information demand issues to Microsoft, we still cannot even obtain from the FTC a copy of this document.

“The Bloomberg story appears to be consistent with an unfortunate trend over the last two years of the FTC strategically leaking nonpublic information. You recently observed in your report to Chair Khan on the FTC’s “Top Management and Performance Challenges,” the volume of unauthorized disclosures of non-public information has been “steadily increasing” during Chair Khan’s watch and that “it appears that the media may be obtaining significant amounts of [non-public information] from sources within the FTC. Members of the U.S. Senate and the U.S. House of Representatives have also noted and complained about this trend.

“Microsoft learned of this information demand, like the rest of the world, through the Bloomberg story. To date, Microsoft has not received any formal legal process, such as a Civil Investigative Demand, from the FTC. And when we called to inquire about the validity of the Bloomberg story, staff would not confirm the existence of the information request. As you know, FTC law enforcement investigations are nonpublic. The FTC’s ethics rules permit disclosure of a non-merge investigation if the Office of Public Affairs “determines that the target has disclosed, in either a press release or public filing with another governmental body, that it is the subject of an investigation.” Microsoft, of course, cannot disclose that of which it has no knowledge.

“While this leak is an unfortunate development for Microsoft, it is more problematic for the integrity of the FTC’s processes. As your report informed Chair Khan, the “trust of businesses, consumers, and other affected parties…is vital to the FTC’s ability to execute on its law enforcement mission.”

“I strongly urge your to investigate this most recent incident fully and to make your findings public as promptly as possible.

“Sincerely,

“Rima Alaily
“Corporate Vice President & Deputy General Counsel
“Microsoft Corporation”