Google asks judge to throw out Texas-led antitrust suit

Google asked a federal judge in New York to toss an antitrust suit over the company’s ad business. Anadolu Agency via Getty Images

Google asked a New York federal judge on Friday to throw out most of what it claimed was an “inaccurate and inflammatory” antirust suit brought by Texas and 14 other states over the tech giant’s online advertising practices.

The Texas suit — which was first filed in December 2020 and been updated twice since then — claims that Google illegally muscled competitors out of the online advertising market and even struck a backroom deal with Mark Zuckerberg to give Meta’s Facebook a lucrative leg up in online ad auctions.

In Friday’s motion to dismiss, Google claimed that there was no evidence it had broken antitrust laws and argued that Texas attorney general Ken Paxton and the other attorneys general behind the suit are unfairly trying to punish Google for being successful.

“They criticize Google for not designing its products to better suit its rivals’ needs and for making improvements to those products that leave its competitors too far behind,” Google’s attorneys wrote. “They see the ‘solution’ to Google’s success as holding Google back, rather than letting market forces urge its competitors forward.”

Manhattan federal court Judge P. Kevin Castel will now have to rule on the 52-page motion, which will likely be challenged by Paxton. The Texas attorney general’s office did not immediately respond to a request for comment.

Texas attorney general Ken Paxton is leading the suit.

AP

According to the suit, Google’s power over the online ad market is equivalent to a large bank like Goldman Sachs or Citibank owning the New York Stock Exchange.

Google’s monopoly power allows it to take a 22% to 42% cut of all US ad spending that passes through its systems, effectively taking millions out of the pockets of advertisers and publishers, the suit argues.

When Facebook developed an alternative online ad bidding system that could have challenged Google’s dominance, Google hatched “an unlawful agreement” in 2018 to give Facebook “information, speed, and other advantages” in Google-run ad auctions in exchange for the social network backing down from competitive threats against the company, the suit alleges.

The agreement was allegedly approved personally by Google CEO Sundar Pichai and Meta CEO Mark Zuckerberg.

In Friday’s motion, Google denied manipulating ad actions and said that the deal with Facebook was neither secret nor anticompetitive.

“The allegation that has generated the most attention is that we somehow ‘colluded’ with Facebook Audience Network (FAN) through our Open Bidding agreement,” Google economic director Adam Cohen wrote in a blog post on Friday. “That’s simply not true.” 

“This agreement does not provide [Facebook] with an advantage in the Open Bidding auction,” Cohen added. “We don’t allocate ad space to [Facebook], they don’t receive speed advantages, and we don’t guarantee that they win any auctions.”

Google’s motion seeks to throw out four of the suit’s six counts with prejudice.

In addition to the four federal claims, the suit also contained two state law claims that were stayed in September and not covered by Friday’s motion.

Google called the lawsuit “inaccurate and inflammatory.”

REUTERS

“We’re confident that this case is wrong on the facts and the law, and should be dismissed,” Cohen said. “However, if it does move forward, we’ll continue to vigorously defend ourselves.”