Utah’s Sean Reyes joins lawsuit against Google for its ad practices

The attorney general says Google is violating its ‘don’t be evil’ motto.

(Rick Egan | Tribune file photo) Attorney General Sean Reyes speaks during a news conference on Tuesday, Aug. 21, 2018.

Utah is joining a multistate lawsuit against Google, alleging the search engine is “anticompetitive” and “deceptive” in its ad practices.

“To the detriment of competitors and consumers, Google has strayed from its founding motto of ‘Don’t be evil’ by displaying naked greed and a disdain for the law in its pursuit of absolute market dominance,” said Utah Attorney General Sean Reyes in a news release. “Rather than relying on innovation and merit in an open market, Google has chosen to attempt to crush all competition with a concerted scheme that few in the public understand.”

The suit alleges that Google violated federal and state antitrust laws by monopolizing online advertising. It unlawfully required publishers of online content to transact through Google’s ad exchange program if they wanted to do business with advertisers that use Google as a middleman. This meant Google could get fees from both advertisers and publishers, in addition to fees for using Google’s exchange site, according to the suit.

“In this electronically traded market, Google is pitcher, batter and umpire, all at the same time,” reads the lawsuit.

Google uses its monopoly to extract a high percentage of ad fees, according to the suit. This means online publishers, like cooking blogs and news sites, receive less money for ads. Companies also end up getting charged more money on ads meaning consumers ultimately pay more for products, according to the suit.

Publishers tried to add more competition to the market by using “header bidding,” which routed ad inventory to multiple ad exchanges so users could get the best bid for their inventory. The lawsuit alleges that Google used a program that secretly allowed its own bids to win even when other exchanges had higher bids. The details of this alleged plot are obscured in the lawsuit, which has sections that are redacted.

Texas Attorney General Ken Paxton, who originally filed the suit, said Google is using its “monopolistic power” to control pricing of online advertisements, fixing the market in its favor and eliminating competition.

Google called Paxton’s claims “meritless” and said the price of online advertising has fallen over the last decade.

“These are the hallmarks of a highly competitive industry,” the company said in statement. “We will strongly defend ourselves from (Paxton’s) baseless claims in court.”

Other states that have signed onto the suit are Arkansas, Idaho, Indiana, Kentucky, Mississippi, Missouri, North Dakota and South Dakota.

The U.S. Justice Department sued Google in October for abusing its dominance in online search and advertising — the government’s most significant attempt to buttress competition since its historic case against Microsoft two decades ago.

Associated Press writers Jake Bleiberg and Michael Liedtke in San Ramon, California, contributed to this report.

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