The Justice Department recently filed a civil antitrust suit against Google for monopolizing multiple digital advertising technology products, allegedly in violation of Sections 1 and 2 of the Sherman Act.
Justice Dept. Sues Google for Digital Ad Monopoly
The suit was filed in the U.S. District Court for the Eastern District of Virginia, with the complaint alleging that Google monopolizes the ‘ad tech stack’, which is the collective term for key digital advertising technologies. The monopoly allegation is due to the dependence on Google’s ad tech stack of both website publishers selling ad space and advertisers buying that ad space.
Restoring Competition and Obtaining Equity
The Justice Department and accompanying state Attorneys General intend for the monopolization lawsuit to restore competition and obtain equitable and monetary relief on behalf of the American public.
The cited Sherman Antitrust Act of 1890 is a United States antitrust law which prescribes the rule of free competition among those engaged in commerce. Section 1 of the act prohibits anticompetitive agreements, while Section 2 prohibits ‘unilateral conduct that monopolizes or attempts to monopolize’ any particular market.
Google’s ‘Anticompetitive and Exclusionary Conduct’
A statement on the Department of Justice website stated: “As alleged in the complaint, over the past 15 years, Google has engaged in a course of anticompetitive and exclusionary conduct that consisted of neutralizing or eliminating ad tech competitors through acquisitions; wielding its dominance across digital advertising markets to force more publishers and advertisers to use its products; and thwarting the ability to use competing products. In doing so, Google cemented its dominance in tools relied on by website publishers and online advertisers, as well as the digital advertising exchange that runs ad auctions.”
Deputy Attorney General Lisa O. Monaco explained further, saying: “The complaint filed today alleges a pervasive and systemic pattern of misconduct through which Google sought to consolidate market power and stave off free-market competition. In pursuit of outsized profits, Google has caused great harm to online publishers and advertisers and American consumers. This lawsuit marks an important milestone in the Department’s efforts to hold big technology companies accountable for violations of the antitrust laws.”
Attorney General Merrick B. Garland added: “No matter the industry and no matter the company, the Justice Department will vigorously enforce our antitrust laws to protect consumers, safeguard competition, and ensure economic fairness and opportunity for all.”
Redress for Overpaying Federal Agencies
In order to redress Google’s anticompetitive conduct, the Department of Justice is seeking equitable relief on behalf of the American public. They are also demanding treble damages for losses sustained by federal government agencies that overpaid for web display advertising.
It is the first monopolization case in approximately 50 years in which the Justice Department has sought damages for a civil antitrust violation.
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I think they have some merit and this probably will get ugly.
If the DOJ succeeds here, then the legal folks at Amazon, Apple and Meta better get ready, because they’ll be next.