Antitrust Lawsuits Against Google & Facebook: What You Should Know
Big tech companies have been hit with multiple antitrust lawsuits from the United States Department of Justice (DOJ) and other agencies in the past few months. The Google lawsuits have garnered a lot of media attention, and the Facebook lawsuits are also very much in the news. So what is an antitrust lawsuit? And what does the outcome mean for consumers and business owners here in Gainesville? The business litigation lawyers of Avera & Smith are here to provide you an overview of the current antitrust legal landscape.
What Is an Antitrust Lawsuit?
In the United States, antitrust laws have their roots in the Sherman Act of 1890, which essentially prohibits business agreements that eliminate competition as well as business behavior that creates a monopoly in a particular market. Essentially, any antitrust lawsuit seeks to prevent large companies from abusing their power to snuff out the competition. These laws demonstrate the importance of free competition to our country’s commercial enterprises.
The DOJ Antitrust Lawsuits Against Google
More than 35 states have filed a broad antitrust lawsuit against Google, based on the claim that the company manipulates search results to give lower rankings to its competitors’ products and services. The lawsuits argue that this prevents consumers from seeing the best options when searching for almost anything, from retail and restaurant options to travel services and software.
Other claims of the tech giant’s monopolizing behavior include exclusive deals with smartphone companies (such as Apple) and other device manufacturers to make Google the default search engine on many web browsers. The lawsuits allege that these actions eliminate the ability of rival companies (Bing, DuckDuckGo, etc.) to compete. According to the 38 states that filed suit against Google, these suppression tactics have led to Google’s 90% dominance in the market.
Facebook’s Lawsuit Echoes Monopoly Concerns
Similarly, Facebook is facing antitrust lawsuits from dozens of states and the federal government for anticompetitive business behavior. This behavior includes the social media giant’s acquisition of Instagram for $1 billion and WhatsApp for $19 billion. Both sales occurred within the past 10 years. While regulators originally allowed these purchases of Facebook’s smaller rivals, the economy has become more concentrated than ever, and the federal government is worried about the negative effects this has on consumers. When the public is deprived of choices, there is nothing stopping large companies from setting unreasonably high prices or abusing their power in other ways.
Google & Facebook Aren’t the Only Companies Facing Scrutiny
The verdicts of the DOJ antitrust lawsuits against Google, Facebook and others (Amazon and Apple are being investigated for similar practices) will have far-reaching implications. If found guilty, these companies may have to break up their assets. But on a larger scale, the country will be sending a message about what particular anticompetitive practices constitute abuse in the ever-growing tech segment. Whatever the outcome, the function of antitrust laws is to ensure that our economy encourages innovation and produces a wide range of options for its consumers.
Contact Avera & Smith’s Business Litigation Attorneys
As business opportunities continue to grow here in Florida, so will the need for business litigation expertise, from corporate cases and contract disputes to insurance coverage and liability. The business litigation lawyers of Avera & Smith are here to help. To see if Avera & Smith can help with your case, don’t hesitate to reach out today.