In the third government-related lawsuit brought against it in the last two months, Google is being sued by 38 states, accused of carrying out anti competitive actions to build a monopoly on the search world. This follows a landmark Department of Justice lawsuit over a similar issue in October.
“We know that scrutiny of big companies is important and we’re prepared to answer questions and work through the issues,” wrote Google’s director of economic policy Adam Cohen in a blog in response to the lawsuit.
“But this lawsuit seeks to redesign Search in ways that would deprive Americans of helpful information and hurt businesses’ ability to connect directly with customers. We look forward to making that case in court, while remaining focused on delivering a high-quality search experience for our users.”
“(Today’s lawsuit) suggests we shouldn’t have worked to make Search better and that we should, in fact, be less useful to you. When you search for local products and services, we show information that helps you connect with businesses directly and helps them reach more customers. This lawsuit demands changes to the design of Google Search, requiring us to prominently feature online middlemen in place of direct connections to businesses.
“Redesigning Google Search this way would harm the quality of your search results. And it would come at the expense of businesses like retailers, restaurants, repair shops, airlines and hotels whose listings in Google help them get discovered, and connect directly with customers. They would have a harder time reaching new customers and competing against big commerce and travel platforms and other aggregators and middlemen.”
The suit was filed on Thursday by 38 states and was brought forward by both Republican and Democrat prosecutors, led by Colorado Attorney General Phil Weiser.
“Google’s anti competitive actions have protected its general search monopolies and excluded rivals, depriving consumers of the benefits of competitive choices, forestalling innovation, and undermining new entry or expansion,” Mr Weiser explained. “This lawsuit seeks to restore competition.”
The latest complaint is similar to the October Department of Justice lawsuit, which concentrated on the billions of dollars that Google pays every year in order to ensure that its search engine is installed as the default option on web browsers and on devices such as mobile phones.
“Google is preventing competitors in the voice assistant market from reaching consumers through connected cars, which stand to be a significant way the internet is accessed in the near future,” said Iowa Attorney General Tom Miller, who also sued Microsoft back in 1998 over antitrust issues.
The case being brought further by the 38 states takes it further than the DoJ suit, however, as they claim Google is using its existing search monopolies, for example exclusionary agreements and its ability to collect vast amounts of data, to also dominate newer technologies.
For instance, the lawsuit claims Google prevents devices that use Google Assistant from including competing virtual assistant technology, such as Amazon’s Alexa.
“Bringing an antitrust case against the most powerful company in the world requires determination and courage, so we applaud the cooperative, bipartisan work of the state attorneys general and all the staff involved in this lawsuit,” Luther Lowe, Yelp’s senior vice president of public policy, said in a statement. “We hope today’s action is the beginning of a return to a more vibrant and open internet.”
The states who filed the lawsuit on Thursday are: Colorado, Arizona, Iowa, Nebraska, New York, North Carolina, Tennessee, Utah, Alaska, Connecticut, Delaware, Hawaii, Idaho, Illinois, Kansas, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Hampshire, New Jersey, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Vermont, Virginia, Washington, West Virginia, Wyoming, the District of Columbia, and the territories of Guam and Puerto Rico.
In a separate issue, ten states also sued Google on Wednesday. The complaint was filed in US District Court in Texas and alleged that after Facebook emerged as a powerful new advertising rival to Google, challenging their established dominance, Google responded by bringing an agreement to Facebook to curtail its competitive moves. In return, Facebook received guaranteed special treatment in Google-run ad auctions, according to the lawsuit.
“Google is a trillion-dollar monopoly brazenly abusing its monopolistic power, going so far as to induce senior Facebook executives to agree to a contractual scheme that undermines the heart of competitive process. In this advertising monopoly on an electronically traded market, Google is essentially trading on ‘insider information’ by acting as the pitcher, catcher, batter and umpire, all at the same time. This isn’t the ‘free market’ at work here. This is anti-market and illegal under state and federal law,” said Attorney General Ken Paxton.
“Google’s monopolization of the display-advertising industry and its misleading business practices stifle innovation, limit consumer choice and reduce competition. Texas and its coalition of allied states bring this action to lift the veil on Google’s secret practices and secure relief to prevent it from engaging in future deceptive and misleading practices.”