10 States Suing Google For Allegedly Abusing Market Power

(Photo by Spencer Platt/Getty Images)

Bradley Devlin General Assignment & Analysis Reporter
Font Size:

Ten states have filed a lawsuit against Google for its online advertising practices, which the suit claims are in violation of antitrust laws, Reuters reported.

The lawsuit, filed in the Eastern District of Texas, is the second major action and the fourth state or federal lawsuit taken against Google to combat anticompetitive behavior from the big tech company, according to Reuters. Texas was joined by Arkansas, Indiana, Kentucky, Missouri, Mississippi, South Dakota, North Dakota, Utah and Idaho on the lawsuit, Reuters reported.

Texas and the other joining states argue that Google dominates the process to get advertisements on websites and apps that attract consumers, according to Reuters. (RELATED: Google Is Lifting Its Ban On Political Ads)

“Google repeatedly used its monopolistic power to control pricing (and) engage in market collusions to rig auctions in a tremendous violation of justice,” Texas Attorney General Ken Paxton said in a Facebook video. Paxton went on to say Google “eliminated its competition and crowned itself the king of online advertising.”

Previously, Paxton had joined the Justice Department’s lawsuit in October that accused Google of illegally using its market influence to undercut rival companies, Reuters reported. Eleven other states also joined the Justice Department lawsuit, according to Reuters.

“We will strongly defend ourselves from his baseless claims in court,” a Google spokeswoman said in reference to Paxton and the lawsuit, according to Reuters. “Digital ad prices have fallen over the last decade. Ad tech fees are falling too. Google’s ad tech fees are lower than the industry average. These are the hallmarks of a highly competitive industry,” the spokeswoman added.

Alphabet, Google’s parent company, raised $37.1 billion in digital advertising, according to Alphabet’s most recent quarterly report. The ad sales from Google, such as the text advertisements atop Google searches, accounted for 80% of Alphabet’s revenue, Reuters reports.