Texas is suing Alphabet’s Google for anti-competitive behavior, Attorney General Ken Paxton said Wednesday.
“I am proud to announce that the State of Texas is suing Google for anti-competitive behavior, foreclosure practices and misleading misrepresentations,” Paxton said in a video on Twitter. “Google has repeatedly used its monopolistic power to control pricing, negotiate market deals to manipulate auctions in a massive violation of justice.”
Paxton said on Twitter that his suit focuses on the lucrative digital advertising market, which is where Google derives most of its revenue. Google did not immediately respond to a request for comment.
The case is the second antitrust action against the search giant after the US Department of Justice filed a landmark monopolization lawsuit against the company in October.
The pressure on dominant tech companies has escalated under President Donald Trump. Last week, Facebook Inc. sued by the Federal Trade Commission and a coalition of states seeking to break up the company by halting the acquisitions of Instagram and WhatsApp, deals the government said were part of a campaign to illegally crush competition.
The pressure under President-elect Joe Biden is expected to continue as the power of internet platforms has become a rare issue that has caused concern on both sides.
Paxton had also joined the Justice Department case in October, along with ten other Republican Attorneys General, in the most significant monopolization case in more than two decades. The federal case focuses on Google’s position in online search, alleging that it used exclusive deals to expand its monopoly.
The Google adtech company, which sells services that handle nearly every step of a digital ad along the journey from a brand’s creative team to a consumer’s screen, generated more than $ 21 billion in revenue in 2019.
Paxton announced on Tuesday that he would hire the law firm of mass tort practitioner Mark Lanier, who won a multi-million dollar judgment against Johnson & Johnson in 2018, to lead the trial crew. Paxton also said he plans to hire the firm of Keller Lenkner LLC, which Facebook has sued. Ken Starr, the former independent counsel whose investigation led to the ouster of President Bill Clinton, will also be part of Lanier’s team, Bloomberg reported.
Another group of states led by Colorado is also investigating Google and could file a third lawsuit on Thursday targeting the search and ad business, said two people familiar with the case.
The Justice Department also explored the adtech market, where Google uses technology for online publishers and advertisers, as well as the exchanges connecting the two, Bloomberg reported. All cases could eventually be consolidated in one judge.
Critics and competitors say Google is violating ad technology antitrust laws by offering discounts and special features to induce advertisers and publishers to use its products alone, rather than combine them with competing services. Not only is Google one of the world’s largest ad space providers, but it also sells software tools used by almost every part of the complex digital marketing industry.
Publishers and advertisers have long complained that Google’s massive and complex digital ad system is a ‘black box’ that leaves them in the dark about how ad placements are met and how prices are set. In particular, news outlets have claimed that the company does not compensate them enough for content, leading to a sudden decline in the financial viability of journalism.
Google has previously said that it has lowered prices for ads while increasing the opportunities for small businesses to reach customers. It has also boasted that it sends 70% of digital ad revenue back to publishers, and has criticized the US search as “very flawed.”
Although Google started out as a search engine, it grew rapidly through acquisitions, including that of the digital advertising company DoubleClick in 2007, to control large parts of the digital advertising ecosystem. Google has also collected massive amounts of data – decades of buying preferences and browsing habits from consumers and businesses – to bolster its advertising and make it harder for newbies.
In September 2019, Paxton announced during the steps of the U.S. Supreme Court that he was leading 50 attorneys-general in an investigation into Google’s position in online advertising. The move signaled twofold concerns about the company and ushered in increasing public pressure.
Still, the Texas-led coalition began to split in the following months as other states moved their own lines of research beyond the advertising market, including Google’s search and Android mobile operating system, Bloomberg News reported.
Paxton, a conservative Republican, was charged by senior aides in October with possible crimes, including bribery, which he has denied. The allegations, unrelated to the Google case, were rebuked by the campaigning division of the Democratic Attorney General, who said his “failure to step down” threatened their “joint work.”
Google is also facing increasing pressure from other quarters in Washington. A House panel that spent more than a year investigating dominant tech companies accused Google of stealing content from rivals to create a ‘walled garden’ to keep users on its properties, rather than taking them to others. sites. The panel, led by Rhode Island Representative David Cicillin, has proposed measures, including banning the companies from participating in markets they also exploit, which could effectively break up some of them.
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