Sunday December 04, 2022

Google denies Facebook collusion claims in new court filing and blog post

Google has moved to dismiss the antitrust lawsuit filed last week. It alleges that it colluded to manipulate programmatic advertising markets. “State Plaintiffs’ complaint — cheered by a few of Google’s competitors who have failed to invest correctly, compete successfully or innovate consistently — might serve those narrow interests,” Google claims in the motion. However, it also threatens the dynamism that Google and other firms rely on to deliver the products consumers and businesses depend on every day.
The antitrust suit was originally filed in November. Texas attorney general Ken Paxton of Texas has led the case and has slowly revealed more allegations through a series revised complaints. Last week’s complaint provided details about Google’s alleged collusion in a lawsuit against Facebook. It included details about a project called “Jedi Blue” which the suit claims was intended to limit ad head bidding practices.
The new complaint is based on internal emails that show Jedi Blue was reviewed with input from Google CEO Sundar Pichai, Meta / Facebook CEO Mark Zuckerberg, and CFO Sheryl Sandersberg. Google denies that the deal was anticompetitive and claims it was approved by Pichai without his direct approval.
In a blog post, Adam Cohen, director for economic policy at Google, stated that the allegations are “more heat-than-light” and that Google doesn’t believe they meet the legal standard for bringing the case to trial. He wrote that the complaint “misrepresents our business and products, and we are moving for dismissal based on its failures to offer plausible antitrust allegations.”
The lawsuit’s core is the claim that publishers are forced by Google to access its ad platform via Google’s ad server. Google claims that this claim is false and AG Paxton has no evidence to support it. Google also denies that it stopped rivals from using Open Bidding and that it rigged ad sales to favor Facebook. Cohen claims that the lawsuit is also based on outdated information that “has no correlation to our current products and business.”
The new complaint cited a 2015 email in that “Google employees expressed concern that Google’s exchange might have to compete with other exchanges in the future.” The complaint has been rewritten to include a section that claims that Google made concessions for Facebook as part Jedi Blue, which gave Facebook an advantage when it came to auctions.
Google argues in its motion to dismiss that the lawsuit does no evidence of anticompetitive conduct. The motion states that despite accumulating a long list of grievances, each one boils down to a plea to Google to share its data and to design its products in a way that would benefit its competitors. The Sherman Act does not require such things. None of the conduct alleged by the [complaint] falls within the narrow exception to general rule that any firm can choose with whom it will do business. Courts are rightly skeptical about challenges to how a company designs products, especially when innovation creates more options for consumers.
Google also refutes Paxton’s claim that the company conspired with the Facebook Audience Network secretly via its Open Bidding Agreement. Cohen noted that the agreement isn’t exclusive and that it “announced FAN’s participation as one the over 25 partners in the Open Bidding program, each of whom have signed their agreements to participate.”
Cohen said that Facebook’s participation in the agreement is beneficial for both publishers and advertisers. He wrote that FAN was not part of Open Bidding and that it could have been claimed by AG Paxton that we were preventing a competitor from accessing our products, and thus depriving publishers additional revenue.

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