Texas leading states in new antitrust action against Google
The technology giant told FOX Business that Paxton's claims are 'meritless'
Texas Attorney General Ken Paxton is leading the charge in a new antitrust action against Google for anticompetitve conduct.
"I am proud to announce the state of Texas is filing a multi-state lawsuit against Google for anti-competiitve conduct, exclusionary practices and deceptive misrepresentations. " Paxton said in a video posted to Twitter Wednesday. "Google repeatedly used its monopolistic power to control pricing, engage in market collusions to rig auctions in a tremendous violation of justice."
Paxton claims that Google is using its power to manipulate the market, destroy competiton, and harm the consumer.
"These actions harm every person in America," Paxton added "It isn't fair that Google can harm the webpages you visit and read and it isn't fair that Google effectively eliminated its competition and crowned itself the head of online advertising."
GOOGLE LOST $1.7M IN AD REVENUE DURING YOUTUBE OUTAGE, EXPERT SAYS
The lawsuit, filed on Wednesday with the United States District Court for the Eastern District of Texas, claims Google "monopolized or attempted to monopolize products and services used by advertisers and publishers in online-display advertising" and that the company "engaged in false, misleading and deceptive acts while selling, buying and auctioning online-display ads," violating the Sherman Act.
"Google has repeatedly and brazenly violated antitrust and consumer protection laws. Its modus operandi is to monopolize and misrepresent," the lawsuit states. "Google uses its powerful position on every side of the online display markets to unlawfully exclude competition. It also boldly claims that 'we’ll never sell your personal information to anyone,' but its entire business model is targeted advertising—the purchase and sale of advertisements targeted to individual users based on their personal information. From its earliest days, Google’s carefully curated public reputation of 'don’t be evil' has enabled it to act with wide latitude."
The lawsuit cites Google's 2008 acquisition of ad tech company DoubleClick, which it claims marked a “fundamental change” where the company began to “exert leverage” as a middle man to extract payments from all steps of the complex online ad-buying process.
In addition, the complaint claims that Google engaged in an “unlawful agreement” with Facebook, in which the two tech giants allegedly cut a deal to "manipulate advertising auctions." As part of the alleged agreement, Google offered Facebook "information advantages, speed advantages, and other prioritizations" to manipulate auctions hosted by Google at the detriment of other auction participants.
Facebook did not immediately return FOX Business' request for comment.
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Paxton's action seeks to "remove the veil of Google’s secret practices and end Google’s abuse of its monopoly power in online advertising markets," to "restore free and fair competition," and to "secure structural, behavioral, and monetary relief to prevent Google from ever again engaging in deceptive trade practices and abusing its monopoly power to foreclose competition and harm consumers."
Joining Texas as co-plaintiffs are nine Republican-led states: Arkansas, Idaho, Indiana, Kentucky, Mississippi, Missouri, North Dakota, South Dakota and Utah.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| GOOGL | ALPHABET INC. | 164.76 | -2.87 | -1.71% |
| FB | NO DATA AVAILABLE | - | - | - |
Google told FOX Business that Paxton's claims are "meritless", citing recent declines in ad tech prices and fees and noted they will "strongly defend ourselves from his baseless claims in court.”
A spokesperson for the company also said in a statement that "Google's ad tech fees are lower than the industry average. These are the hallmarks of a highly competitive industry."
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Paxton's lawsuit is separate from an antitrust lawsuit filed in October by the Department of Justice, which claims Google has illegally maintained a monopoly in online general search services by cutting off competitors from key distribution channels.
Texas previously led a multistate investigation which included its own probe into Google's ad tech businesses as well as a series of probes into other big tech competitors like Facebook, Apple and Amazon.