Google gets involved: third lawsuit in two months – global markets

The search giant, Google (NYSE: GOOG) is facing another lawsuit from the Antitrust Authority, the third in less than two months. This time the lawsuit comes from a bipartisan coalition of state attorneys with the goal of dismantling Google’s monopolistic power.

Colorado Attorney General Phil Wiser is leading a group of 38 states on their way to a lawsuit alleging that Google illegally maintained a monopoly on online search through contracts and systematic anti-competitive conduct. The committee members leading the states also include Arizona, Iowa, Nebraska, New York and more.

Wieser said the group would file a motion to merge the case along with the Justice Department’s latest lawsuit against Google. Similar to the lawsuit filed by the Justice Department with the State Attorney’s Office in 11 countries in October, the new lawsuit also accuses Google of running a monopoly on online search. However, the new lawsuit focuses on mechanisms different from those of the prosecution, which the group claims Google used to maintain its power illegally.

The Justice Department’s lawsuit claims that Google uses contracts that prevent competitors from gaining access to major distribution channels and thus ensures the continuation of its monopoly in the field of online search. In the lawsuit, the Justice Department focused primarily on Google’s contract with Apple (NYSE: AAPL). Phil Weiser claims that the new lawsuit goes behind the Justice Department’s lawsuit when it examines how Google allegedly used those contracts to “tie up” additional evolving distribution channels.

The lawsuit alleges that Google’s contracts with technological device manufacturers and distributors, which undertake to set Google as the default provider on their devices (similar to the iPhone), are uncompetitive and responsible for part of Google’s monopoly. Google’s contract has ensured that the popular search engine is the default in 80% of the various web browsers, with the complaint stating that they “create artificial barriers that prevent competitors from reaching consumers”.

Moreover, a group of attorneys from ten countries sued Google for monopolistic conduct in the advertising business, along with an allegedly illegal deal with Facebook (NYSE: FB). The new lawsuit against Google comes about a week after those same states sued Facebook through a coalition of 48 chief attorneys led by Letitia James from New York. Similar to Google, the lawsuit alleges that Facebook used means to prevent competition, including acquiring potential competitors before they became bigger threats. In the new statement from the State Attorney’s Office, they sought to consolidate the other claims, into one claim against the monopoly.