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Coalition wants AGs to probe Google

By Jessica M. Karmasek | Oct 13, 2011


WASHINGTON (Legal Newsline) - A coalition of businesses and organizations is asking all 50 state attorneys general to investigate search engine giant Google for possible antitrust violations.

FairSearch.org, in its 44-page paper entitled "Google's Transformation from Gateway to Gatekeeper: How Google's Exclusionary and Anti-Competitive Conduct Restricts Innovation and Deceives Consumers," details its concerns that the company's business practices threaten competition and the free markets, deceive consumers and threaten further innovation, economic growth and new jobs from the technology sector.

FairSearch.org sent its paper to the attorneys general, saying they play "an important role" in the ongoing investigations of Google's business.

The coalition notes that Texas, California, Ohio and New York already have opened full-scale investigations into the Mountain View, Calif.-based company.

Last fall, Texas Attorney General Greg Abbott announced that his office was officially looking into the company's methods for recommending websites. The investigation was spurred by complaints that Google has abused its power as the Internet's most dominant search engine.

Such allegations were levied against the company by UK-based Foundem, New York-based SourceTool and TradeComet, and Ohio-based myTriggers.

In February, Abbott requested information from Google about its advertising rate formula and search result rankings. Investigators with Abbott's office were looking for documents that showed "manual overriding or altering of" search result rankings.

Abbott's office also wanted documents on rivals Bing and Yahoo! and any complaints about buying an ad on the search engine.

Now more states, including Mississippi and Oklahoma, are considering investigating the company, the coalition says.

Meanwhile, the U.S. Federal Trade Commission, the Korean Fair Trade Commission and the European Commission also are looking into Google's business practices, it says.

Patrick Lynch, former Rhode Island Attorney General and former president of the National Association of Attorneys General, authored the letter introducing the coalition's paper and urging the attorneys general to get involved.

Lynch, who currently serves as an advisor to FairSearch, says evidence is "mounting" that the company's business practices deserve further investigation from law enforcement.

The time to act "to protect competition, innovation and consumers" is now, he says.

In his letter, Lynch alleges that Google steers users toward its own products by displaying them at the top or in the middle of the results page in ways that suggest to consumers that they are natural search results, rather than links to Google sites in which Google has a direct economic interest.

He also alleges that the company manipulates its search algorithm to exclude or penalize competing sites, effectively "disappearing" them from the Internet.

He also accuses the search engine of "unauthorized content scraping," or stealing content developed by other websites, such as user reviews, without permission and displaying that content on its own pages, sometimes even without attribution.

Lynch says Google also manipulates advertisers' quality scores to inflate ad prices and places restrictions on its "must buy" ad platform that inhibit customers from using competing platforms.

The former attorney general also accuses the search engine of buying up companies in the mobile search area that present "a nascent competitive threat," and imposing exclusivity restrictions in its Android licensing agreements to maintain and expand its dominance.

"I believe that if you look at the evidence presented, you will come to the same conclusion that your colleagues and the federal competition authorities have. The time to simply take Google at face value when it says 'trust us' is long past," Lynch wrote.

"State attorneys general have a critical role to play in investigating Google's conduct to prevent further harm to competition and consumers, and many of you are already deeply involved. I encourage each of you to examine the attached white paper closely, speak with your colleagues who are actively investigating Google's conduct, and consider standing with them in protecting consumers and competitive markets by opening your own investigation."

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

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