The  ”matters upon which Commissioner Rosch previously advised Intel are so distant in time—and concern technology, allegations, and business relationships that are so dissimilar to those relevant to the present matter,” Leibowitz said.

Another commissioner, William Kovacic is recused on the case because his wife’s law firm represents Nvidia, an Intel competitor that has lobbied the FTC to file suit against the chip giant.

In a separate statement, Rosch said he spent hundreds of hours considering the case and met with Intel officials three times, including a Dec. 3 meeting wherein he told Intel’s general counsel he had “tentatively formed a “reason to believe” that a complaint should issue,” without the company mentioning it might want him recused from the review.

Intel filed its motion to have Rosch disqualified hours before the Commission voted to file suit against the company.

Intel’s general counsel, A. Douglas Melamed spoke to Chairman Leibowitz several hours before Intel sought the recusal, Rosch said, without mentioning the motion.

Intel Corp. is raising questions about whether the Federal Trade Commission acted hastily in filing an administrative lawsuit against the chip maker yesterday.

The agency sent its first subpoena to Intel just last week for information on certain conduct included in its lawsuit filed yesterday, Intel’s spokesperson Chuck Mulloy confirmed to Main Justice.

The subpoena, issued on Dec. 8, was the first time the FTC asked Intel to provide information related to the graphics chip market, Mulloy said. Although the agency had opened an antitrust investigation of Intel in May 2008, yesterday’s lawsuit was the first time any regulatory agency had singled out the company’s conduct in the market related to graphics and multimedia.

Intel hired former Antitrust Division chief Doug Melamed last month. (Getty Images)

Intel had been in settlement talks with the agency. Those talks broke down over several new issues, Intel’s general counsel, Douglas Melamed, said in a conference call with reporters yesterday. The issues included graphics and benchmarks, which had not been fully investigated by the FTC, Melamed said.

“They wanted concessions on graphics that they hadn’t even investigated,” Mulloy said in an interview.

The FTC’s competition bureau director, Richard Feinstein, said in a news conference yesterday that the FTC staff had thoroughly investigated the claims outlined in its complaint.

The FTC lawsuit against the chip maker outlines a broader case against the company than other complaints have raised.

In the past, Intel has been accused of illegally inducing its customers to spurn rival products. The FTC’s case alleges that Intel also engaged in anti-competitive behavior in a separate market for chips, known as graphics processing units, that are made for heavy multimedia use.

An FTC spokesman also said the agency investigates matters for some time before issuing subpoenas for specific information.

The FTC has accused Intel of resorting to “deception and coercion” to catch up with rival innovators as it “fell behind in the race for technological superiority.”

Intel has fought back against the lawsuit by claiming that the FTC is overreaching both in its legal case against Intel and in the changes that the FTC is seeking in Intel’s behavior.

The broad scope of the FTC’s suit surprised many observers, given that Intel had previously signaled it was open to resolving the many antitrust issues against it. Last month Intel agreed to pay rival chip maker Advanced Micro Devices, Inc. $1.25 billion to settle a long-running dispute over rebates Intel offered its customers. The company also hired Melamed last month, adding a savvy insider to its team. Melamed, most recently a partner at WilmerHale, had been acting chief of the Justice Department’s Antitrust Division during the Clinton administration.

In filing suit against Intel Corporation today, the Federal Trade Commission will test the limits of its authority to enforce antitrust laws, observers say.

It’s a “very ambitious case,” that will “explore the contours” of antitrust laws, said Kenneth Glazer, who previously served as deputy director in the FTC’s competition bureau and is a partner at K&L Gates.

The agency today accused the chip giant of  waging “a systematic campaign to shut out rivals” by “cutting off their access to the marketplace.”

The suit comes on the heels of several important developments in the long-running Intel case. In the last year, the company agreed to a $1.25 billion settlement with rival chip maker Advanced Micro Devices, Inc., was hit with a $1.45 billion fine from the European Union, and was targeted in a separate lawsuit filed by New York State Attorney General Andrew Cuomo.

In the past, Intel has been accused of of illegally inducing its customers to spurn AMD’s products.

The FTC’s case goes further. It says that Intel engaged in anti-competitive behavior in a separate market for chips, known as graphics processing units, that are made for heavy multimedia use. It also alleges deceptive marketing practices that raise consumer protection concerns. Previous litigation has largely focused on antitrust violations.

After what two commissioners called an “unprecedented” four meetings, the commission voted yesterday to unanimously file suit.

Commissioner William E. Kovacic was recused from the matter because his wife’s firm, Jones Day, represents Intel competitor, Nvidia, which makes the multimedia chips and lobbied the FTC to bring the suit.

In a statement, Intel accused the commission of adding “last minute” allegations the FTC had not properly investigated, and demanding an “unprecedented” set of remedies.

“This case could have, and should have, been settled,” said the company’s general counsel, Douglas Melamed, who served as acting antitrust chief in the Clinton Justice Department. Melamed joined Intel last month after the AMD settlement.

The FTC’s wide-ranging complaint covers conduct stretching back a decade. The agency brought its case under multiple authorities, some of which have rarely been tested by courts.

The FTC usually brings monopolization cases indirectly through the Sherman Act, which governs the Justice Department’s antitrust cases. But the FTC can also bring antitrust cases through its own authority, under the Federal Trade Commission Act. Section 5 of that statute prohibits broader “unfair methods of competition.”

Recent cases the FTC has brought under its Section 5 authority, including a 2005 cases against Negotiated Data Solutions, have resulted in settlements and were not tested by judicial scrutiny.

In its case against Intel, the FTC tried both approaches.

“What they are doing is hedging their bets,” said Robert Litan, a former deputy in the Antitrust Division during the Clinton administration, where he supervised the first Microsoft investigation. “Section 5 is a safety net and catch-all. [The case] is designed to set precedent and see if it sticks.”

The 24-page complaint includes nearly five pages of proposed remedies to change Intel’s conduct.

Chairman Jon Leibowitz and Commissioner J. Thomas Rosch alleged in a statement that Intel “fell behind in the race for technological superiority,” and resorted to “deception and coercion” to catch up with AMD and other innovators.

“Intel has engaged in a deliberate campaign to hamstring competitive threats to its monopoly,” said Richard A. Feinstein, who heads the FTC’s competition bureau. “It’s been running roughshod over the principles of fair play and the laws protecting competition on the merits.

The complaint is filed not in federal court but through an administrative process within the commission. The FTC recently announced new rules for the commission to expedite cases, after coming under fire for letting matters drag on for years. A trial, which will test the commissions new procedures, is slated for next September.