First Of Potentially Many Google Antitrust Claims Goes To Trial

Legal Issues

from the do-you-trust-the-antitrust-process? dept

There have been a whole bunch of antitrust lawsuits filed against Google over the last few years (in fact, one just settled last week though we don’t yet know the details, though when that case was first filed, we noted some problems with it).

The very first, though, seemed like the weakest. As you may recall, in the waning days of the Trump administration, it was reported that Trump was pressuring then Attorney General Bill Barr to sue Google to punish “Big Tech” which he felt was against him. Notably, that article highlights that Barr took the investigation away from the antitrust department and handed it over to Jeffrey Rosen, who had little experience with antitrust.

When the eventual case was actually filed, we highlighted how surprisingly weak it was. It seemed clear that it was a last minute rush job, designed to be filed weeks before the presidential election, almost entirely so that Trump could claim he was taking on “Big Tech.”

This is not to say that any antitrust case against Google would be bad. As we’ve noted, the one filed earlier this year, regarding Google’s advertising practices, seemed a lot more serious and problematic for the company.

But, that first Bill Barr-driven case is finally going to trial (amusingly, I keep seeing GOP-supporting folks suddenly standing up for Google in this case and against “the Biden administration,” without knowing or realizing that this was the case brought by the Trump admin, and not the Biden admin). Over the past few years, a lot about the case has changed. The docket has almost 700 filings, and many of the original claims have been tossed out during the process.

One of the most straightforward writeups I’ve seen about the straight facts of the case, what the DOJ has to prove, and what Google’s likely responses will be, comes from (occasional Techdirt contributor) Jeffrey Westling, who highlights the useful nuts and bolts of what needs to happen and what to look for:

To win at trial, the DOJ and the AGs will need to prove two elements for their primary claims. First, they must show that Google has monopoly power in a relevant market. Second, they must show that Google willfully achieved or maintained this monopoly power using anticompetitive conduct designed to exclude rivals and not through vigorous and effective competition.  

In this case, the plaintiffs will argue that the relevant market – that is, for the purpose of competition law, the set of products or services consumers consider substitutes – is general search and search advertising, and that Google’s dominant market share and the difficulty of entry in those markets gives the firm monopoly power. The plaintiffs will also argue that Google unlawfully maintained its monopoly by implementing and enforcing a series of exclusionary agreements with distributors, denying rivals access to these channels and entrenching Google’s market position. 

Despite these claims, Google will likely have a strong defense. First, while Google may have a substantial market share for general text search, it is unclear that that general text search should be considered the relevant market for the purpose of this case, especially when advertising is taken into account. Consumers use a wide range of services, from product-focused Amazon to social media apps such as TikTok and Instagram, to find information. Second, even assuming that general search is the relevant market, obtaining default status in this market represents competition on the merits, something the courts not only allow but actively encourage.  

As Westling details, it’s not even a slam dunk the government will be able to prove monopoly power here, and if they do, they then need to show anticompetitive conduct, while Google can try to provide a procompetitive justification for its actions:

As other courts have held, when a firm’s conduct serves to improve the quality of its product, no weighing of procompetitive benefits with anticompetitive is even necessary. The D.C. Circuit Court will still likely weigh the exclusionary effects with the procompetitive justifications as other circuit decisions are not binding in this case. 

Second, providing a default or preinstalled search engine improves competition in adjacent markets. For example, Apple’s decision to use Google as its default search engine for Safari allows the company to better compete with rival mobile operating systems using Android and another mobile web browsers. Traditional web browsers such as Firefox likewise benefit from a default search engine because this arrangement makes search easier for its users. As Mozilla’s CEO said at the summary judgment hearing, “[w]e’re making search easy for them, and we added a choice in a product in a way that no one else had or even thought of.”  

I’m not going to handicap how I think this will play out. Once things actually go to trial, there’s always a very large element of randomness. I still think that the fundamentals of this particular case are a lot weaker than other cases (like the advertising one filed this year).

If the government wins, then it seems like it would actually do more harm to the recipients of Google search deals, who get a ton of money to put Google as the default in their browsers, than it would to Google itself. I just don’t fundamentally see how this case would change Google’s business all that significantly (again, the ads case would be a very different story). So, even if the DOJ wins this case, it seems like it would actually end up doing more harm to companies like Mozilla, who is a competitor to Google, but relies on cash from Google search deals to fund its competitive browser, Firefox.

If Google wins, then it will certainly be another bad look for the governments’ new obsession with antitrust, but again this is just one case, and the more recent one seems much stronger. I do wonder, though, if losing this case would make the government reconsider its strategy in the other case.

Filed Under: antitrust, competition, doj, search, search deals
Companies: google