Google Urges Judge To Gut Texas-Led Antitrust Lawsuit

Google on Friday urged a judge to dismiss federal antitrust claims brought by a Texas-led coalition of state attorneys general who allege that the company used "monopolistic power" to rig online ad auctions.

The company argues in papers filed with U.S. District Court Judge Kevin Castel in New York that the allegations in the sprawling 242-page complaint, even if proven true, wouldn't show that Google violated any antitrust laws.

“Despite amassing a lengthy collection of grievances, each one comes down to a plea for Google to share its data or to design its products in ways that would help its rivals. The Sherman Act requires no such thing,” Google writes. 

Google also says the bulk of the claims should be dismissed as untimely -- either because the alleged conduct occurred more than four years ago or, as with allegations relating to potential privacy changes, hasn't yet occurred.

The papers come in response to an antitrust lawsuit brought in December of 2020 by a Texas-led coalition of states.

The allegations in the lengthy complaint date to 2008, when Google acquired DoubleClick, but the complaint also references more recent activity -- including allegations that Google collaborated with Facebook in 2018 to undermine header bidding.

The attorneys general specifically alleged that Google and Facebook entered into an agreement to undermine “header bidding.”

“Facebook substantially curtailed its use of header bidding in return for Google giving Facebook a leg up in publishers’ web display and developers’ in-app ad auctions, allocating a portion of the wins to Facebook, and helping Facebook’s ad network ... beat the competition,” the complaint alleges.

Google counters in its new papers that the states' allegations regarding a deal with Facebook, even if proven true, wouldn't support the conclusion that Facebook agreed to not support header bidding.

Another allegation in the complaint focuses on Google's privacy plans, including its plans to prevent third-party ad companies from setting cookies in the Chrome browser, and proposal to offer new targeting mechanisms.

“Overall, the changes are anticompetitive because they raise barriers to entry and exclude competition in the exchange and ad buying tool markets, which will further expand the already dominant market power of Google’s advertising businesses,” the complaint alleges.

Google counters that any claims based on future privacy plans aren't ripe for a lawsuit, arguing the allegations “refer only to proposals that are still subject to change."

Google had originally said it Chrome would block third-party cookies by 2022, but recently delayed plans to do so until late 2023. Google also recently backed away from a plan to replace cookie-based ad targeting with a controversial system it dubbed the Federated Learning of Cohorts, or FLoC. That system would have involved placing Chrome users into audience segments based on their web-browsing activity, and then transmitting data about those segments directly to publishers.

The Texas-led lawsuit, brought by attorneys general from 16 states and Puerto Rico, is one of four antitrust cases brought by government officials in the last two years.

The Justice Department and a coalition of more than 30 states alleged in separate lawsuits in 2020 that Google illegally monopolizes search. And last year, attorneys general from 36 states and the District of Columbia sued Google over its app store policies.

Dozens of publishers and advertisers are also suing Google over alleged antitrust violations. Those cases, which largely draw on accusations made by the Texas-led attorneys general, are also presided over by Castel in New York.

The Texas-led complaint also includes allegations that Google violated various state antitrust laws. The motion filed Friday doesn't address those state-law claims.

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