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The Google logo can be seen displayed on the Google house at CES 2024, an annual consumer electronics trade show held in Las Vegas, Nevada, on January 10, 2024. — Reuters
WASHINGTON: Google is facing a new challenge in federal court on Monday as U.S. government attorneys request a judge to order the breakup of the company’s advertising technology division.
This lawsuit marks Google’s second legal challenge this year after a similar government effort to dismantle its empire was dismissed earlier this month by a judge.
The focus of Monday’s case is specifically on Google’s ad tech “stack”—the tools used by website publishers to sell ads and by advertisers to purchase them.
Earlier this year, Federal Judge Leonie Brinkema ruled in favor of the U.S. Department of Justice (DOJ), stating that Google maintained an illegal monopoly over this market.
The upcoming trial will determine the penalties and structural changes Google must undertake to address its market dominance.
Court filings indicate that the U.S. government will argue Google should spin off its ad publishing and exchange operations. Additionally, the DOJ is seeking a ban on Google operating an ad exchange for ten years after the divestitures.
Google counters that these breakup demands exceed the court’s findings, are technically unfeasible, and could harm the market and smaller businesses.
“From the outset, we’ve expressed that the DOJ’s case misinterprets how digital advertising works and overlooks how much the landscape has changed, with more competition and new entrants,” said Lee-Anne Mulholland, Google’s Vice President of Regulatory Affairs.
In a related case in Europe, the European Commission fined Google €2.95 billion ($3.47 billion) earlier this month for controlling the ad tech market.
Brussels’s decision included behavioral remedies, though some critics argued the fine was lenient, especially since divestiture was previously suggested as a potential solution.
This phase of the U.S. trial follows a prior ruling that found Google operated an illegal monopoly. It is expected to last about a week, with closing arguments scheduled to follow shortly thereafter.
This trial coincides with another case where a judge recently rejected a government request for Google to divest its Chrome browser—a decision widely seen as a win for Google.
That case, also brought by the DOJ, found Google responsible for illegal monopoly practices in online search. Rather than a major breakup, the company was ordered to share data with rivals as part of the remedy.
The DOJ had argued that Chrome, which accounts for a third of all Google web searches, was crucial to internet access, making its divestiture essential. Since that ruling, Alphabet’s stock has surged over 20%.
Judge Brinkema has indicated she will closely review the outcome of the search monopoly case when considering her own ruling.
These legal battles are part of a larger bipartisan effort by the U.S. government against major tech giants, with five antitrust cases currently pending against such companies.
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