Everyone’s favorite search engine has been having a rough week on the antitrust front.
On Wednesday, tradecomet.com filed a private antitrust suit against Google, just a few months after the company’s travails were profiled in the New York Times. As Sarah Lacy puts it,
TradeComet’s SourceTool.com is basically a middleman-site that aims to connect searchers with the businesses they are looking for by showing them search ads and directory listings. The press release says repeatedly that Google was supportive of SourceTool until the site got too powerful and became a clear “competitive threat” to Google. Now Google is using its monopolist power to run TradeComet—which plows some 80% of its profits back into Google ads—out of business.
Tradecomet puts it differently. According to Tradecomet, the company “was forced to file the lawsuit when Google refused to stop engaging in predatory conduct to block search traffic by imposing massive, unjustified price increases.” Allegedly, Google did enter into an agreement with Business.com, a competitor of Tradecomet, which I guess is the necessary conspiracy or combination in restraint of trade.
Jonathan Kanter (SUNY Albany JD ’95, Washington U. JD ’98), a Cadwalader antitrust partner who has nothing to do with this case, thinks the claims are slightly more tenable than Miss Lacey, telling the Times that “Google understood the threat that vertical search engines posed to its business model.” Samuel Miller (Yale BA ’71, Boalt JD ’75) of Sidley Austin concurred, saying “I do believe that this properly alleges harm to competition, not just harm to one plaintiff.”
On the other side, we have Eric Goldman (UCLA BA ’88, UCLA JD ’94), a technology law professor at Santa Clara University, who was more skeptical. He claimed that courts had dismissed a similar antitrust case against Google. “We’ve heard all these arguments before and they haven’t gotten much traction,” Mr. Goldman said.
Tradecomet is the least of Google’s antitrust concerns, though. The company’s real fear should be Christine Varney (SUNY Albany BA ’77, Syracuse MPA ’78, Georgetown JD ’86), Obama’s appointment to head the Antitrust Division at DOJ. Varney, formerly of Hogan & Hartson, reportedly said
“For me, Microsoft is so last century. They are not the problem. The U.S. economy will continually see a problem — potentially with Google because it already has acquired a monopoly in Internet online advertising.”
At least there’s a silver lining: Boring v. Google, the suit by the Pennsylvania couple who claimed their privacy was invaded and house value diminished by Google’s including their property in Google Street View, was dismissed.
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