Federal Trade Commission Chairman Andrew Ferguson said Friday that the agency should bring its merger challenges directly in federal court, rather than the agency's in-house administrative process, as it typically has done.

Speaking at the annual antitrust symposium at George Mason University's Antonin Scalia Law School, Ferguson addressed a recent commission merger challenge where the agency is asking a federal court to permanently block the deal.

The FTC usually files an in-house case and then asks a court to prevent the transaction from closing until the administrative proceeding plays out. But when moving in December to block Loctite-maker Henkel AG & Co. KGaA from buying rival construction adhesive brand Liquid Nails, the agency filed only in federal court.

"My view is we ought to just litigate this in federal court, both to avoid the constitutional challenges every time you bring a merger case ... and to align with the standard that the [U.S.] Department of Justice has to comply with in order to get an injunction of a merger," Ferguson said.

Ferguson acknowledged that as a practical matter, the preliminary injunction decision is usually the "end of the question," because merging companies often abandon deals if temporarily enjoined. He said the commission typically drops its case if it loses because unwinding a consummated merger is too difficult and raises questions of equity.

He noted the U.S. Supreme Court's 2024 ruling in U.S. Securities and Exchange Commission v. Jarkesy, which challenged an SEC administrative action. He said that case and others call into question the FTC's ability to bring administrative cases at all.

"Jarkesy has language in it suggesting that in private rights-type cases, even if the government is not extracting a civil penalty, or other monetary relief, you can't proceed in an agency adjudication, it has to go to an Article III court," he said.

Ferguson also noted the Supreme Court's 2023 ruling in Axon v. FTC, where the justices found that companies can bring constitutional challenges against the FTC directly in federal court before going through the agency's in-house administrative process.

He said some in Congress have criticized the FTC for seeking preliminary injunctions, because the U.S. Department of Justice has no administrative process and always files directly in court. Lawmakers have argued that this means some merger cases are decided based on which agency reviews the deal.

While the standards for preliminary and permanent injunctions are different, Ferguson said he doesn't believe the outcomes are actually different.

Former FTC Chairman Timothy Muris, now a professor at George Mason and a counsel with Sidley Austin LLP, asked Ferguson if filing merger cases directly in court will become the new norm at the commission.

Ferguson said he believes that would be the "healthiest" way for the commission to proceed, and not only for the legal reasons, but also because it lends more credibility.

That's because under the usual process, the FTC's commissioners vote to bring a case and then issue a final determination at the conclusion of the administrative proceeding.

"No man ought to sit in judgment of his own case, that is axiomatic of the Anglo-American system of law," he said.