DOJ, 11 Republican AGs Sue Google for Alleged Search Monopoly

DOJ and 11 Republican state attorneys general sued Google Tuesday for its alleged monopoly in general search services and search advertising. Senior Vice President Kent Walker called the lawsuit “deeply flawed,” saying consumers choose to use Google, “not because they're forced to or because they can't find alternatives.” New York Attorney General Letitia James and six other Democratic state AGs announced they’re continuing a parallel investigation and could potentially consolidate the case with DOJ in coming weeks. Industry groups condemned the suit; reaction from consumer advocates varied.

Over the past 16 months, DOJ found evidence Google “no longer competes only on the merits but instead uses its monopoly power -- and billions in monopoly profits -- to lock up key pathways to search on mobile phones, browsers, and next generation devices, depriving rivals of distribution and scale,” said Attorney General William Barr. “The end result is that no one can feasibly challenge Google’s dominance in search and search advertising.”

Joining the case were AGs from Arkansas, Florida, Georgia, Indiana, Kentucky, Louisiana, Mississippi, Missouri, Montana, South Carolina and Texas. Texas' Ken Paxton, who helped lead the investigation, said the complaint “is intended to restore competition and allow rivals and next generation search engines to challenge Google so that the marketplace, not a monopolist, will decide how search services and search ads are offered.” Google “stifled competition,” said Louisiana AG Jeff Landry. “Without competition, we do not have capitalism; and without capitalism, we do not have America.”

The department didn’t rush to file the lawsuit, Deputy Attorney General Jeffrey Rosen told reporters in response to a question about the filing in the lead-up to the November election. “I would disagree that it is a rush,” Rosen said, citing the more than year-long probe. “It’s important to move as quickly as is practical because the markets are fast-moving. The department moves ahead when the facts and the law support doing so.” DOJ was pleased to have 11 AGs sign on, Rosen said, noting the department had conversations with other AG offices that indicated shared concerns. He noted Tuesday’s complaint includes overlapping claims seen in the House Antitrust Subcommittee’s recent report on Big Tech competition (see 2010090053).

It’s “critical” for DOJ’s lawsuit to focus “on Google’s monopolization of search and search advertising,” said House Antitrust Subcommittee Chairman David Cicilline, D-R.I. The department should also focus on “the anticompetitive business practices Google is using to leverage this monopoly into other areas, such as maps, browsers, video, and voice assistants.” House Judiciary Committee Chairman Jerry Nadler, D-N.Y., called DOJ’s lawsuit “an important step for ensuring a competitive online space. The Committee will continue our robust oversight of the antitrust laws and the antitrust agencies to ensure that we address the rise of monopolization in our economy.”

Antitrust, Censorship

The complaint is based on violations of U.S. antitrust law and “is separate and distinct from concerns raised about content moderation and political censorship by online platforms,” said Barr. He accused Google of employing the “same anticompetitive playbook” as Microsoft in the 1990s: “If we let Google continue its anticompetitive ways, we will lose the next wave of innovators and Americans may never get to benefit from the ‘next Google.’” The department separately is backing changes to Communications Decency Act Section 230, Barr said.

Walker said Google negotiates with companies like Apple, AT&T, Verizon, Samsung and LG for “eye-level shelf space.” Google’s agreements with Apple and “other device makers and carriers are no different from the agreements that many other companies have traditionally used to distribute software,” he wrote. “Other search engines, including Microsoft’s Bing, compete with us for these agreements.” Google is confident courts will side with the company, he said.

House Commerce Committee Republicans asked Chairman Frank Pallone, D-N.J., Tuesday to demand a hearing with the CEOs of Twitter, Facebook and Google about social media censorship: “This recent censorship controversy is just one more in a litany of instances in which these companies have shown utter disregard for being democratic public squares and seek to suppress speech that does not advance their particular agenda.” Pallone’s office didn’t comment. The Senate Judiciary Committee scheduled a Thursday vote to subpoena testimony from CEOs at Twitter and Facebook about censorship claims. Senate Antitrust Subcommittee Chairman Mike Lee, R-Utah, said he looks forward to the vote. Ranking member Amy Klobuchar, D-Minn., welcomed the Google suit but questioned the timing. It likely will get passed to the next attorney general and state AGs, she said, saying it will be up to them to “finish the job.”

FTC Commissioners Rebecca Kelly Slaughter and Christine Wilson refrained from discussing the lawsuit during a Technology Policy Institute webcast event Tuesday. George Mason University law professor Joshua Wright, a Republican ex-FTC commissioner, framed the complaint as “part of a bigger important movement about what to do about antitrust” policy at DOJ and the FTC, and whether the "current institutions are up to the task.” The federal government’s current antitrust actions are “a high” point “in the ebb and flow of antitrust moments in history,” he said. Democratic ex-FTC Chairwoman Edith Ramirez of Hogan Lovells agreed the current moment is a momentous antitrust time.

Reaction

The Computer & Communications Industry Association raised concerns that the legal challenge is politically driven by an administration that has “aggressively pressured” tech companies. “Antitrust law should be driven by consumers’ interests, not political imperatives,” said President Matt Schruers. “We look forward to a court’s review of the facts and the evidence.”

DOJ should take into account that foreign enforcers take action against U.S. tech companies to support their own domestic companies, said Information Technology and Innovation Foundation President Robert Atkinson: “While the DOJ should always take action against any anti-competitive conduct that hurts consumers, they should avoid structural remedies, which are often grounded in a ‘big is bad’ anti-monopoly ideology without considering the broader implications that such a policy would have on innovation.” The suit isn’t backed by evidence, said NetChoice Vice President Carl Szabo: “Google Search might be popular, but it’s no monopoly. The Department of Justice’s case strikes out on three pitches: showing consumer harm, market power, or market abuse.”

Public Knowledge welcomed the suit. Competition Policy Director Charlotte Slaiman called it “an important first step towards people-centered innovation in search engines.” Google has dominated in a way that makes it too difficult for competitors “offering better products and services to compete fairly in the search market,” she said. Public Citizen Competition Policy Advocate Alex Harman called the case a “thinly veiled political stunt.” The suit's narrow focus, and the partisan group of co-signers is “evidence of an unserious approach driven by politics and is likely to result in nothing more than a choreographed slap on the wrist for Google,” Harman added.

The News Media Alliance welcomed the litigation. NMA said search distribution issues are a small part of the problems with Google’s dominance. “News publishers are particularly harmed by Google’s control of ad tech -- and that doesn’t appear to be covered at all by the DOJ’s action today,” said CEO David Chavern. He urged support for the Journalism Competition and Preservation Act (see 1904030064).