Alphabet CEO Sundar Pichai. State investigators have sought emails and other documents from high-level Google executives and directors. PHOTO: BRANDON WADE/REUTERS

Tech

Google Resists Demands From States in Digital-Ad Probe

par Featured articles licensed from The Wall Street Journal | le 25 February 2020


 

 

 

Company is reluctant to surrender some documents in investigation of possible anticompetitive practices

By

John D. McKinnon – The Wall Street Journal

WASHINGTON—Google is resisting efforts to surrender emails, text messages and other documents sought by state investigators probing possible anticompetitive practices, according to records and interviews.

Google, a unit of Alphabet Inc., also hasn’t agreed to a waiver that would give the coalition of state attorneys general access to documents obtained by the Justice Department for its own probe, according to a person familiar with the situation.

Texas Attorney General Ken Paxton, who is leading the investigation by 48 states, the District of Columbia, Puerto Rico and Guam, said the company’s actions suggest it is withholding information that could be damaging.

“Every indication right now is they don’t believe that they’re clean because they don’t act in any way like they are,” Mr. Paxton said in an interview.

A Google spokeswoman said the company has cooperated with the probe and that such discussions over access to information are common during investigations. She also raised concerns that the Texas-led investigation has been advised by outside business consultants who could potentially share confidential information from Google with rival companies.

“To date, Texas has requested, and we have provided, over 100,000 pages of information,” the spokeswoman said. “But we’re also concerned with the irregular way this investigation is proceeding, including unusual arrangements with advisers who work with our competitors and vocal complainants.”

The investigation by state attorneys general seeks to determine whether Google engaged in anticompetitive behavior in building up its ad business, among other issues.

As part of their probe, state investigators have sought emails and other documents from high-level executives and directors at the company, as well as texts and instant messages of other Google employees who might have information on suspect practices, according to letters reviewed by The Wall Street Journal under a public-records-act request.

Google attorneys have raised concerns to Texas investigators about the scope of their requests.

In a letter dated Dec. 26, for example, lawyers for Google in Texas said that in a recent phone call, Texas investigators had made “significant and new requests” beyond their September civil subpoena, including demands for chats and text messages from Google employees. Google lawyers asked for “a reasonable approach and timeframe for responding” to the demands.

In a Jan. 6 reply, the chief of the Texas Office of the Attorney General’s antitrust division responded, “This is not true: the instructions accompanying our [civil subpoena] clearly indicate that these types of electronic materials are both covered and requested, and we have not agreed or implied that mere email searches could suffice to satisfy Google’s [subpoena] obligations.”

The two sides have also clashed over how many Google employees must be included in the search for responsive information. During the first five months of the investigation, Texas proposed 96 while Google proposed 11, according to a Feb. 4 letter from Google lawyers. Google has since increased the number of employees it was willing to include in the search, according to the letter.

Google says that the company has moved quickly to produce relevant documents to the attorneys general, even as it battles the Texas state attorney general over other aspects of the probe.

Google is concerned that the probe led by Texas Attorney General Ken Paxton has been advised by consultants who could share confidential information with rivals.
PHOTO: TONY GUTIERREZ/ASSOCIATED PRESS

In a suit filed in Texas on Oct. 31, Google sought protections to prevent consultants hired for the Texas-led investigation from improperly using information obtained during the probe.

The Google suit said that one of the consultants, Cristina Caffarra of Charles River Associates, “has worked directly for numerous Google adversaries on antitrust and competition matters,” including Microsoft Corp. and News Corp, owner of The Wall Street Journal.

Texas filed a response opposing Google’s suit. Texas officials believe Google’s concerns about potentially improper disclosure of sensitive information are adequately addressed by existing state confidentiality protections. Ms. Caffarra declined to comment. A settlement of the suit was reached Thursday, according to the person familiar with the matter.

News Corp has complained that Google and other digital companies siphon ad revenue from content creators. Microsoft competes with Google on several fronts including cloud services and office-productivity tools.

The current tensions with Google are reminiscent of past run-ins with the company, said Sen. Josh Hawley (R., Mo.), who investigated the company in 2017 as attorney general of Missouri on possible antitrust and consumer-protection issues.

“First they said they weren’t subject to Missouri’s antitrust and consumer-protection laws,” Mr. Hawley said. “Then they refused to turn over documents and information. Then they didn’t turn over what they said they would. It’s the Google playbook—stall, stonewall, deflect and deny, because they are afraid the public will finally get the truth.”

Mr. Hawley has emerged as an outspoken congressional critic of Google and other big tech firms since being elected to the Senate.

The Google spokeswoman responded: “We have always acted in good faith in answering regulators’ questions promptly, honestly and thoroughly, providing millions of pages of documents over the years about our various businesses and technologies. Any suggestion to the contrary is simply false.”

Google also fought a broad subpoena issued by then-Mississippi Attorney General Jim Hood in 2014. That subpoena sought information on Google’s platforms, ad practices and efforts to police “dangerous” or “illegal” content related to illicit drug sales, consumer credit-card information, human trafficking and copyright infringement.

In response, Google filed a suit against Mr. Hood that resulted in a federal judge enjoining the Mississippi probe for a time. The judge said Google had presented “significant evidence of bad faith,” suggesting that the attorney general’s investigation represented an effort to coerce Google to comply with Mr. Hood’s requests regarding content removal.

Google’s complaint came as emails surfaced from a hack of Sony Pictures, suggesting movie studios were working behind the scenes with Mr. Hood’s office to discredit Google. The motion-picture industry has long complained about copyright abuses on the internet. The injunction against Mr. Hood was eventually overturned on appeal.

State attorneys general investigating Google have been in discussions with Mr. Hood—who left office in January—about joining their effort, likely as an expert.