The US Department of Justice and eight states on Tuesday sued Google over its advertising business, alleging it engages in monopolistic behavior.
The complaint, filed in federal court in Virginia, alleges that Google has “corrupted legitimate competition in the ad tech industry” through a campaign of seizing control of tools and inserting “itself into all aspects of the digital advertising marketplace.” Google allegedly has done so by eliminating competition through acquisitions and used its dominance to push advertisers to use its products over those of others.
The DOJ also said that Google disadvantages websites that “dare to use competing ad tech products” and uses its dominance in ad technology to “funnel more transactions to its own ad tech products where it extracts inflated fees to line its own pockets at the expense of the advertisers and publishers it purportedly serves.”
Google pushed back at the allegations.
“Today’s lawsuit from the DOJ attempts to pick winners and losers in the highly competitive advertising technology sector,” a Google spokesperson said in a statement. The statement went on to say that the DOJ lawsuit largely duplicates an “unfounded lawsuit” by Texas attorney general Ken Paxton, one that was dismissed in federal court. Google says the DOJ’s argument is flawed and will “slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow.”
The Department of Justice didn’t immediately respond to a request for comment.
The DOJ lawsuit is a rare instance in which the department has called for the breakup of a major company. Other instances include its faceoffs with the Bell telephone company in 1982 and Windows maker Microsoft in 2001. It comes as governments around the world are attempting to rein in Big Tech. The US Senate in the last year or so has contemplated the American Innovation and Choice Online Act to curb the influence of Amazon, Apple and Google in digital marketplaces. Last year, Google was fined in France over user tracking and agreed to a $391.5 million settlement with state attorneys general for location tracking practices.
This is the second antitrust lawsuit filed by the DOJ against Google’s ad business, and the first to come under the Biden administration. The first lawsuit, filed in October of 2020 under the Trump administration, alleged Google blocked out competitors by making deals with Apple and Samsung to be the default search engine on their devices. Google is also facing an antitrust lawsuit led by Texas, along with 16 states or territories, alleging the search giant worked with Facebook to give the social network an advantage in online advertising auctions.
Last year, Google reportedly made attempts to fend off the DOJ lawsuit by offering to split its ad tech business.
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Imad Khan