Feds, Google clash over data sharing as search monopoly remedy takes shape

WASHINGTON (CN) — Attorneys for Google and the Justice Department began the long process of hashing out how to apply a federal judge’s remedy to the tech giant’s internet search monopoly on Wednesday, nearly five years after the case was first brought in late 2020.

U.S. District Judge Amit Mehta called the parties back into court to determine what his remedy will look like in reality just over a month after he issued his decision, in which he declined to order the divestment of Google’s Chrome browser and instead imposed light penalties.

In his Sept. 2 ruling, the Barack Obama appointee ordered Google share its search index and user data with search engine competitors — which rivals have argued are necessary to match the quality Google has accomplished via its monopoly — as well as certain search syndication services.

Mehta pressed Justice Department attorney David Dahlquist and Google attorney John Schmidtlein on the syndication issue, expressing concern about how to define a “qualified” search engine competitor when the data-sharing process begins.

He hypothesized that, without the proper guardrails, a new company could enter the search market and then after obtaining Google’s search and user data, either out of a lack of progress or some nefarious reason, turn around and sell that trove of data to a third party.

“We ought not to leave it to chance,” Mehta said, emphasizing the significant value of such data to untrustworthy actors and countries antagonistic to the United States.

Dahlquist urged Mehta to avoid placing too many limitations on who could become a qualified competitor, describing the judge’s hypothesis as a “doomsday scenario” that he did not consider likely, and worrying that such restrictions could place a low ceiling on the amount of competition introduced into the search market.

He added that a narrow definition of “selling” Google’s data should be considered, otherwise the company could argue that any qualified competitor selling a product based on the syndicated data was a violation.

Schmidtlein argued that the data syndication should be limited to just Google’s search index, rather than include user data, because that’s what competitors are truly interested in.

He suggested that, if any user data were to be shared, it should be anonymized and potentially narrowed to U.S.-based users or English-only users considering Google’s vast trove of global user data.

In his remedy decision, Mehta barred Google from entering or maintaining exclusivity contracts that condition the Google Play Store with the preloading of another Google application, like search or Gemini.

Dahlquist worried that the company could circumvent the prohibition by conditioning several other Google products — such as YouTube or Google Maps — to ensure that Google search remains the overwhelming default on third-party devices.

Mehta’s ruling, however, did not foreclose Google from entering into deals with companies to set its search engine as the default on certain devices; instead, he opened the agreements to allow a company like Apple to obtain deals and set different defaults across separate devices on a yearly basis.

In a support brief for its proposed remedy, Google has pushed for multi-year agreements with annual options, citing apparent interest from third-party partners, where another company could interchange certain Google products each year.

Jonathan Sallet, lead counsel for a bipartisan coalition of plaintiff states, compared the multiyear deal to baseball contracts with balloon payments in the final year, meant to keep a player for the full term. Sallet argued Google could include certain terms, such as increased revenue share each year, to make the multiyear deals just as exclusive as the previously monopolistic default deals.

“The important thing is Google holds all the cards,” Justice Department attorney Richard Gower added. “They’re the monopolist here.”

Mehta also pushed Dahlquist on the so-called technical committee — a quasi-advisory board responsible for enforcing certain portions of the ultimate remedy — and the government’s suggestion that Google be allowed to object to nearly any decision made by the committee and bring the issue back to Mehta.

“I don’t want to be a referee,” Mehta said, expressing concern that repeated objections could draw the beginning of the remedy phase out over years before really beginning. “It seems like that part of my job is done.”

Dahlquist posited that the committee will act as a court of first review, emphasizing his hope that most conflicts can be dealt with there, but that Mehta is nonetheless the arbiter of last resort and would have to address significant issues.

The parties are expected to continue working out the details of the remedy together over the coming months, with Mehta set to address any issues in court once again.

Looming over the process, however, is Google’s vow to appeal to the D.C. Circuit, where the last landmark antitrust case of this century, United States v. Microsoft, largely faltered in 2001 and resulted in a settlement.

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