The US Department of Justice as well as a number of State Attorney’s General, are planning to slap Google with an antitrust lawsuit. This is according to a report coming out of The Wall Street Journal on Friday.
As expected, shares of Google’s parent company, Alphabet dropped pretty sharply after hours when this news broke.
The lawsuits will likely be filed this summer
The Justice Department is aiming to file at least one case this summer. Meanwhile, some of the State Attorney’s General are likely to file their lawsuits in the fall. Which is being led by Texas.
Google stated that “We continue to engage with the ongoing investigations led by the Department of Justice and Attorney General Paxton (of Texas), and we don’t have any updates or comments on speculation. Our focus is firmly on providing services that help consumers, support thousands of businesses, and enable increased choice and competition.”
The Justice Department has been probing Google for a little over a year now. After President Trump asked why the US doesn’t fine tech giants like the European Union does. Which fines Google about once a year. As well as Facebook and other companies.
These investigations are into Google’s ad business
Both the Justice Department and State Attorney’s General lawsuits are investigating Google’s ad business.
However, since the probe started by Attorney General Paxton, the scope has expanded to search and the Android operating system. While some States might bring a lawsuit against Google’s ad business, it is still likely that others could pursue separate cases, for different legal theories.
The Justice Department has been solely focused on Google’s ad business. And it has been more broadly investigating allegations that it has used the dominance in the search market to squeeze out competitors.
Currently, it’s unclear whether State Attorney’s General and the Justice Department will forge together to sue Google, or if they will bring up their own separate cases. Of course, for State Attorney’s General, being able to work with the Justice Department would bring a lot more resources to the table. As they are federal enforcers. However, the DOJ and States have not been as close as they should have been. Considering many States were suing T-Mobile to prevent its merger with Sprint. But the Justice Department ultimately let it get approved. Essentially throwing the States to the curb.
We’ll have to see later this summer what the charges are against Google.