Google, Facebook agree to team against possible anti-action, draft lawsuit

The internal company, as it was filed, cites the documents, which were greatly reduced. The Wall Street Journal reviewed parts of a recent draft version of the suit, which were detailed without conclusion and on the allegations in court documents.

Ten Republican attorney generals, led by Texas, are alleging that the two companies cut a deal in September 2018 in which Facebook did not compete with Google’s online advertising tools in exchange for special treatment.

Google used the language from “Star Wars” as a code name for the deal, according to Sue, who remade the real name. The draft version of the suit states that it was known as “Jedi Blue”.

The lawsuit states that Google and Facebook knew that their agreement could trigger an antitrust investigation and discuss how to deal with them, which is a significant change.

The draft version lays out some of the provisions of the contract, stating that companies will “cooperate and assist each other in response to any antitrust action” and “immediately and completely to the other party of any governmental communication relating to the agreement Inform from. “

In companies contracts, the term [REDACTED] No less than 20 times have been mentioned, ”the lawsuit states. Unproven draft fills in word: antitrust.

A Google spokesperson said that such agreements on antitrust threats are extremely common.

The claims of the states are false. We do not manipulate the auction, ”the spokesman said, adding that the deal was not secret and Facebook participates in other advertising auctions. “Nothing special [Facebook’s] Participation and do not obtain data that are not equally available to other buyers. “

The new lawsuit, filed last week, makes no mention of Facebook Chief Operating Officer Sheryl Sandberg. According to the draft version, Ms. Sandberg signed the agreement with Google. The draft version also cites an email where he told CEO Mark Zuckerberg and other executives: “It’s a big deal strategically.”

Like Google, Facebook has also disputed the allegations in the lawsuit, stating its agreements to bid on the option to promote advertising and to make a clear profit for advertisers, publishers and small businesses.

A Facebook spokesperson said, “It is alleged that this contest is baseless as any suggestion of competition or misconduct by Facebook.”

The final version of the lawsuit did not provide a public statement about the value of the deal. The draft states that with the deal starting in its fourth year, Facebook is off to spend at least $ 500 million annually in a Google-run ad auction. The draft version states, “Facebook has to win a certain percentage of the auction.” Sue says “Facebook is [REDACTED]. ”

According to the draft version, an internal Facebook document described the deal as “relatively cheap” when compared with direct competition, while a Google presentation stated that if the company “refrained from competing with Facebook” , Then it will cooperate in “making a chasm”. . “Those citations are not included in the new lawsuits filed last week.

The lawsuit alleges that Google officials worried about competition from Facebook, as well as others about “header bids,” deploying and online advertising buying techniques.

In an internal Google presentation from October 2016, an employee expressed concern about the ability of competition from Facebook and other large tech companies to “stop these people from doing H.B. [header bidding] Draft wise, we probably need to consider something more aggressive.

The redacted lawsuit discusses Google’s concerns about competition and mentions the presentation, but does not include citations.

Discussing a possible “Facebook partnership” for Google’s “Top Partner Council” since November 2017, according to Google’s internal communications, Google said its endgame was to “cooperate when necessary to maintain the status quo .. . “The redacted lawsuit describes Google’s presentation of the endgame, but excludes citations.

According to the draft, according to the agreement between the two sides, Facebook’s negotiating team sent an email to Mr. Zuckerberg, stating that the company faced options: “invest hundreds more engineers” and the inventory Spend billions of dollars to shut down, go out of business, or deal with Google. According to the draft, Mr. Zuckerberg wanted to meet before the decision was made.

Those details do not appear in the lawsuit filed last week, which names Mr Zuckerberg only once in a separate paragraph about another internal communication about the deal.

For years, criticism of Google’s online advertising empire focused on how the company handled a more lucrative but less visible business on its powerful consumer-facing platforms, such as Google Search and YouTube: software Has acted as a middleman to buy. Selling advertising on the web.

There is a new wrinkle in Facebook’s allegations — that Google cut a deal with a competing middleman, one of which the state described as Google’s “biggest potential competitive threat”.

They also represent a powerful legal risk. Under US law, agreements to fix prices can be easier to prove than other charges from states – meaning Google maintains an illegal monopoly.

In addition to the lawsuit filed in Texas, Google was struck last week in a separate antitrust lawsuit by 38 attorneys general alleging that it monopolized the Internet-search market through anticompetitive contracts and conduct Maintained.

Google has sued over disputes in that lawsuit, as well as alleged monopoly practices last October 20 by the Department of Justice.

Write Ryan Tracy and John D. at [email protected] Mackinnon at [email protected]

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