U.S. v. Google: As landmark 'monopoly power' trial closes, here's what to look for

Dara Kerr

May 02, 2024 / 2:00 am

caption: The Department of Justice and a group of 35 states sued Google in 2020 for allegedly using anticompetitive tactics to monopolize online search. The trial is over and closing arguments are under way.

The landmark monopoly trial between the U.S. Justice Department and Google comes to a finale this week. After a five-month hiatus, both sides will present closing arguments starting Thursday aiming to persuade the federal judge why they should win the case.

The Justice Department has accused Google of illegally abusing its power as a monopoly to control the search engine business — leading to competitors being sidelined and customers being shortchanged by getting a lower quality experience. Google, for its part, has argued its search engine is simply the best, that's why it's the most popular — not because of its business dealings.

It's the first high-profile monopoly case to go to trial among a handful that the U.S. government has brought against tech companies in recent years. The U.S. has also sued Amazon, Apple and Facebook parent Meta over business practices it says hurts both rivals and consumers.

How the judge rules in this case could have far-reaching effects on how people use and interact with the internet.

During the trial last fall, the two sides battled it out in court over a 10-week period. Silicon Valley executives, including Google CEO Sundar Pichai and Microsoft CEO Satya Nadella, testified, while troves of internal documents were introduced. Arguments erupted over redacted evidence, closed-door testimony and alleged destruction of employee chat logs.

"There's this wider debate about whether the antitrust laws are up to it with the big technological world we live in now," says Sam Weinstein, a former Justice Department antitrust lawyer who's now a professor at the Cardozo School of Law. "And so, this is putting it to the test."

The Justice Department first filed its lawsuit against Google in 2020. A group of 35 states, along with Guam, Puerto Rico and the District of Columbia, filed a near identical suit at that time. Both suits were heard by Judge Amit Mehta during the trial, which wrapped up in November.

Google paid $26.3 billion in 2021 alone to be the default search engine on phones and web browsers

The Justice Department's case hinged on allegations that Google illegally orchestrated its business dealings with device makers, like Apple and Samsung, and web browser companies, like Mozilla, which runs Firefox.

During the trial, the government showed that Google paid billions of dollars every year for exclusive agreements with these companies. In 2021, it spent a total of $26.3 billion to ensure it was the default search engine on phones and web browsers, according to witness testimony. Apple, which had the most lucrative deal, was paid around $18 billion in 2021, according to the New York Times.

"Google illegally maintained a monopoly for more than a decade," Kenneth Dintzer, the Justice Department's lead lawyer, said in the trial's opening statements. "If Google sets the rules, it will always be to their advantage."

Google's parent company Alphabet, which is now worth more than $2 trillion, controls roughly 90% of the U.S. search engine market. For its defense, the company put together a massive legal team and brought on outside law firms to help fight its case.

Much of the company's case centers around its claims that people love Google Search and that's why they use it. And, Google argues, if people want to switch the default search engine on their devices, they can with just a few clicks.

"Users today have more search options and more ways to access information online than ever before," Google's lead lawyer John Schmidtlein said during the trial's opening statements.

Even Microsoft CEO says it couldn't compete with Google

Over the course of the trial, the Justice Department called dozens of witnesses to testify – including experts, psychologists and top executives from Apple, Microsoft and Google.

When Microsoft CEO Nadella took the stand, he said that he tried for years to get Apple to set Microsoft's Bing search engine as the default on iPhones and iPads. He added, however, that even a company as big as Microsoft couldn't compete.

Executives from other smaller search engines, like DuckDuckGo and Neeva also testified that Google's exclusive deals closed off their potential to gain market share. Gabriel Weinberg, DuckDuckGo's CEO, said his privacy-centric search engine company tried relentlessly to negotiate deals with device makers but it never panned out.

"We ultimately decided after three years of trying this that it was a quixotic exercise because of the contracts," Mr. Weinberg testified.

Google's witnesses mostly included people within the company. When CEO Pichai testified, he said paying billions of dollars to ensure Google Search had default placement on devices made total sense — as it would for any business.

"We want to make it very, very seamless and easy for users to use our service," he said.

During the trial, Google requested that a lot of the testimony about its business dealings be presented behind closed doors. Eddy Cue, Apple's senior vice president of services, testified for four hours, but more than half of that was closed to the public. And, throughout the trail, Google repeatedly fought to seal documents and shutter proceedings in public court.

It became so pervasive that The New York Times and other major news organizations filed a court motion imploring the judge to ensure the case was conducted in an open courtroom.

The judge will decide if laws from 1800s apply in today's modern world

The trial was what's known as a bench trial, which means there's no jury and Judge Mehta will decide. After closing arguments, he's expected to rule within the coming months.

If Mehta sides with Google, the company's business practices will likely remain the same. If he rules in favor of the Justice Department, it's unclear how he'd sanction Google. It could be anything from fines to a restructuring of the company.

Closing arguments are expected to wrap Friday. It's possible some of the previously sealed documents will be made public, bringing forward more evidence. The Justice Department and Google are expected to reiterate their top takeaways from trial and answer the judge's questions.

In a post-trial brief, Google wrote that evidence during the trial proved "Google is the highest quality, most popular search engine." While the Justice Department and states wrote in their post-trial brief that Google "exploited its monopoly power to 'freeze the ecosystem' of what should otherwise be a vibrant and competitive industry."

Weinstein, the Cardozo law professor, says it will be interesting to see how Mehta rules and whether the antitrust laws that were created in the late 1800s can still be applied in today's modern world.

"I think there's some evidence, at least, that they're still applicable and they can still work even though we're past the smokestack age and into the digital age," he says.