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Google faces new antitrust trial after ruling declaring search engine a monopoly
Legal Interview |
2024/09/06 08:27
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One month after a judge declared Google’s search engine an illegal monopoly, the tech giant faces another antitrust lawsuit that threatens to break up the company, this time over its advertising technology.
The Justice Department, joined by a coalition of states, and Google each made opening statements Monday to a federal judge who will decide whether Google holds a monopoly over online advertising technology.
The regulators contend that Google built, acquired and maintains a monopoly over the technology that matches online publishers to advertisers. Dominance over the software on both the buy side and the sell side of the transaction enables Google to keep as much as 36 cents on the dollar when it brokers sales between publishers and advertisers, the government contends in court papers.
They allege that Google also controls the ad exchange market, which matches the buy side to the sell side.
“It’s worth saying the quiet part out loud,” Justice Department lawyer Julia Tarver Wood said during her opening statement. “One monopoly is bad enough. But a trifecta of monopolies is what we have here.”
Google says the government’s case is based on an internet of yesteryear, when desktop computers ruled and internet users carefully typed precise World Wide Web addresses into URL fields. Advertisers now are more likely to turn to social media companies like TikTok or streaming TV services like Peacock to reach audiences.
In her opening statement, Google lawyer Karen Dunn likened the government’s case to a “time capsule with with a Blackberry, an iPod and a Blockbuster video card.”
Dunn said Supreme Court precedents warn judges about “the serious risk of error or unintended consequences” when dealing with rapidly emerging technology and considering whether antitrust law requires intervention. She also warned that any action taken against Google won’t benefit small businesses but will simply allow other tech behemoths like Amazon, Microsoft and TikTok to fill the void.
According to Google’s annual reports, revenue has actually declined in recent years for Google Networks, the division of the Mountain View, California-based tech giant that includes such services as AdSense and Google Ad Manager that are at the heart of the case, from $31.7 billion in 2021 to $31.3 billion in 2023,
The trial that began Monday in Alexandria, Virginia, over the alleged ad tech monopoly was initially going to be a jury trial, but Google maneuvered to force a bench trial, writing a check to the federal government for more than $2 million to moot the only claim brought by the government that required a jury.
The case will now be decided by U.S. District Judge Leonie Brinkema, who was appointed to the bench by former President Bill Clinton and is best known for high-profile terrorism trials including that of Sept. 11 defendant Zacarias Moussaoui. Brinkema, though, also has experience with highly technical civil trials, working in a courthouse that sees an outsize number of patent infringement cases.
The Virginia case comes on the heels of a major defeat for Google over its search engine, which generates the majority of the company’s $307 billion in annual revenue. A judge in the District of Columbia declared the search engine a monopoly, maintained in part by tens of billions of dollars Google pays each year to companies like Apple to lock in Google as the default search engine presented to consumers when they buy iPhones and other gadgets. |
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The Supreme Court strips the SEC of a critical enforcement tool in fraud cases
Legal Interview |
2024/07/02 10:44
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The Supreme Court on Thursday stripped the Securities and Exchange Commission of a major tool in fighting securities fraud in a decision that also could have far-reaching effects on other regulatory agencies.
The justices ruled in a 6-3 vote that people accused of fraud by the SEC, which regulates securities markets, have the right to a jury trial in federal court. The in-house proceedings the SEC has used in some civil fraud complaints, including against Houston hedge fund manager George Jarkesy, violate the Constitution, the court said.
“A defendant facing a fraud suit has the right to be tried by a jury of his peers before a neutral adjudicator,” Chief Justice John Roberts wrote for the court’s conservative majority.
Justice Sonia Sotomayor, who read from her dissent in the courtroom, said that “litigants who seek to dismantle the administrative state” would rejoice in the decision.
Federal agencies that oversee safety in mines and other workplaces are among many that can only impose civil penalties in in-house, administrative proceedings, Sotomayor wrote, joined by Justices Ketanji Brown Jackson and Elena Kagan.
“For those and countless other agencies, all the majority can say is tough luck; get a new statute from Congress,” she wrote.
The case is among several this term in which conservative and business interests are urging the nine-member court to constrict federal regulators. The court’s six conservatives already have done so, including in a decision last year that sharply limited environmental regulators’ ability to police water pollution in wetlands.
Still awaiting decision are cases calling on the court to overturn the 40-year-old ruling colloquially known as Chevron, which has made it easier to sustain regulation of the environment, public, health, worker safety and consumer protection. Some of the same parties that supported Jarkesy at the Supreme Court are calling for Chevron to be overturned.
The SEC was awarded more than $5 billion in civil penalties in the 2023 government spending year that ended Sept. 30, the agency said in a news release. It was unclear how much of that money came through in-house proceedings or lawsuits in federal court.
The agency had already reduced the number of cases it brings in administrative proceedings pending the Supreme Court’s resolution of the case.
The high court rejected arguments advanced by President Joe Biden’s Democratic administration that relied on a 50-year-old decision in which the court ruled that in-house proceedings did not violate the Constitution’s right to a jury trial in civil lawsuits.
The justices ruled in favor of Jarkesy after the SEC appealed a decision in which the New Orleans-based 5th U.S. Circuit Court of Appeals threw out stiff financial penalties against Jarkesy and his Patriot28 investment adviser.
The appeals court found that the SEC’s case against Jarkesy, resulting in a $300,000 civil fine and the repayment of $680,000 in allegedly ill-gotten gains, should have been heard in a federal court instead of before one of the SEC’s administrative law judges. |
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Court grapples with details on school shooter that were leaked to media
Legal Interview |
2024/06/17 15:33
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A media organization is due in court Monday after publishing details from leaked documents about the shooter who killed six people at a Nashville elementary school in March 2023, while the outlet sues for those records and others to be released to the public.
The hearing, ordered by Nashville Chancellor I’Ashea Myles, has led to outcry not only from Star News Digital Media and Editor-in-Chief Michael Leahy, but also from open government advocates and Tennessee lawmakers.
Leahy’s attorney argued the court proceeding would violate his due process rights and infringe on First Amendment protections after his outlet, The Tennessee Star, reported on records leaked to them about the shooter at The Covenant School.
Initially, the judge ordered Leahy and attorneys to explain in court why the recent work involving leaked documents has not violated court protection of records that could subject them to contempt proceedings and sanctions. The judge later denied a request by Leahy to cancel the hearing but said no witnesses would testify.
The public records lawsuit by the conservative Star News and other plaintiffs remains tied up in court after more than a year. A group of Covenant School parents have joined the lawsuit, arguing none of the documents should ever be released because they could inspire copycats and retraumatize their children.
Though the investigative file remains officially closed to the public’s view, two prominent rounds of evidence about the shooter’s writings have leaked to media outlets.
Police have said they could not determine who was responsible for the first leak. While they look into the second, a lieutenant has drawn a connection to a former colleague without directly accusing him of the leak.
In a court declaration Friday, Nashville Police Lt. Alfredo Arevalo said his office led an investigation of the first leak. A former lieutenant, Garet Davidson, was given a copy of the criminal investigative file that was stored in a safe in his office and only Davidson had the key and safe combination, Arevalo said.
Davidson has left the force. Separately, he filed a well-publicized complaint alleging the police department actively lobbied to gut the city’s community oversight board, as well as a number of other misconduct claims.
In his declaration, Arevalo noted Davidson has spoken about details from the Covenant investigative file on Leahy’s radio show and another program.
Arevalo wrote that he is “appalled” by the leak and “saddened by the impact that this leak must have on the victims and families of the Covenant school shooting.”
The shooter who killed three 9-year-old children and three adults at Covenant, a private Christian school, left behind at least 20 journals, a suicide note and an unpublished memoir, according to court filings.
The city of Nashville has argued it doesn’t have to release the documents during an active police investigation. The plaintiffs have countered there is no meaningful criminal investigation underway since the shooter, Audrey Hale, was killed by police. |
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Judge in Trump case orders media not to report where potential jurors work
Legal Interview |
2024/04/15 14:11
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The judge in Donald Trump’s hush money trial ordered the media on Thursday not to report on where potential jurors have worked and to be careful about revealing information about those who will sit in judgment of the former president.
Judge Juan Merchan acted after one juror was dismissed when she expressed concerns about participating in the trial after details about her became publicly known.
The names of the jurors are supposed to be a secret, but the dismissed juror told Merchan she had friends, colleagues and family members contacting her to ask whether she was on the case. “I don’t believe at this point I can be fair and unbiased and let the outside influences not affect my decision-making in the courtroom,” she said.
Merchan then directed journalists present in the courthouse not to report it when potential jurors told the court their specific workplaces, past or present. That put journalists in the difficult position of not reporting something they heard in open court.
Some media organizations were considering whether to protest having that onus placed on them. Generally, the First Amendment of the U.S. Constitution bars judges from ordering journalists not to disclose what they hear and see in courtrooms open to the public, though there are exceptions, such as when military security is at stake.
New York criminal defense lawyer Ron Kuby said that while judges typically can’t control what the media reports, other options are available to protect juror anonymity, including restricting what reporters see and hear in the courtroom.
“There are actions the judge could take,” he said. “Courts have extraordinary powers to protect jurors from tampering and intimidation. It is really where a court’s power is at its peak.”
The court action underscored the difficulty of trying to maintain anonymity for jurors in a case that has sparked wide interest and heated opinions, while lawyers need to sift through as much information as possible in a public courtroom to determine who to choose.
Despite the setback, 12 jurors were seated by the end of Thursday for the historic trial. Trump is charged with falsifying his company’s business records to cover up an effort during the 2016 presidential election campaign to squash negative publicity about alleged marital infidelity. Part of the case involves a $130,000 payment made to porn actor Stormy Daniels to prevent her from making public her claims of a sexual meeting with Trump years earlier. Trump has denied the encounter.
New York state law requires trial attorneys to get the names of jurors, but the judge has ordered the lawyers in Trump’s case not to disclose those names publicly. The jurors’ names haven’t been mentioned in court during three days of jury selection.
Still, enough personal information about the jurors was revealed in court that people might be able to identify them anyway.
Some news organizations described details including what Manhattan neighborhoods potential jurors lived in, what they did for a living, what academic degrees they had earned, how many children they had, what countries they grew up in and what their spouses did for a living.
On Fox News Channel Wednesday night, host Jesse Watters did a segment with a jury consultant, revealing details about people who had been seated on the jury and questioning whether some were “stealth liberals” who would be out to convict Trump. |
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Elon Musk will be investigated over fake news and obstruction in Brazil
Legal Interview |
2024/04/08 16:01
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A crusading Brazilian Supreme Court justice included Elon Musk as a target in an ongoing investigation over the dissemination of fake news and opened a separate investigation late Sunday into the executive for alleged obstruction.
In his decision, Justice Alexandre de Moraes noted that Musk on Saturday began waging a public “disinformation campaign” regarding the top court’s actions, and that Musk continued the following day — most notably with comments that his social media company X would cease to comply with the court’s orders to block certain accounts.
“The flagrant conduct of obstruction of Brazilian justice, incitement of crime, the public threat of disobedience of court orders and future lack of cooperation from the platform are facts that disrespect the sovereignty of Brazil,” de Moraes wrote.
Musk will be investigated for alleged intentional criminal instrumentalization of X as part of an investigation into a network of people known as digital militias who allegedly spread defamatory fake news and threats against Supreme Court justices, according to the text of the decision. The new investigation will look into whether Musk engaged in obstruction, criminal organization and incitement.
Musk has not commented on X about the latest development as of late Sunday.
Brazil’s political right has long characterized de Moraes as overstepping his bounds to clamp down on free speech and engage in political persecution. In the digital militias investigation, lawmakers from former President Jair Bolsonaro’s circle have been imprisoned and his supporters’ homes raided. Bolsonaro himself became a target of the investigation in 2021.
De Moraes’ defenders have said his decisions, although extraordinary, are legally sound and necessary to purge social media of fake news as well as extinguish threats to Brazilian democracy — notoriously underscored by the Jan. 8, 2023, uprising in Brazil’s capital that resembled the Jan. 6, 2021 insurrection in the U.S. Capitol.
On Saturday, Musk — a self-declared free speech absolutist — wrote on X that the platform would lift all restrictions on blocked accounts and predicted that the move was likely to dry up revenue in Brazil and force the company to shutter its local office.
“But principles matter more than profit,” he wrote.
He later instructed users in Brazil to download a VPN to retain access if X was shut down and wrote that X would publish all of de Moraes’ demands, claiming they violate Brazilian law. Musk had not published de Moraes’ demands as of late Sunday and prominent blocked accounts remained so, indicating X had yet to act based on Musk’s previous pledges. |
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Former Georgia insurance commissioner John Oxendine pleads guilty
Legal Interview |
2024/03/25 11:53
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A former Georgia insurance commissioner who made a failed Republican run for governor has pleaded guilty to conspiring to commit health care fraud.
John W. Oxendine of Johns Creek entered the guilty plea Friday in federal court in Atlanta. The 61-year-old had been indicted in May 2022 on charges of conspiracy to commit health care fraud and conspiracy to commit money laundering.
The crime is punishable by up to 10 years in prison, but Oxendine is likely to be sentenced to less. Federal sentencing guidelines discussed in the plea agreement suggest prosecutors will recommend Oxendine be imprisoned between 4 years, 3 months, and 5 years, 3 months, depending on what U.S. District Judge Steve Jones decides at a sentencing hearing set for July 12. Jones could also fine Oxendine and order him to serve supervised release.
Oxendine also agreed to pay nearly $700,000 in restitution to health insurers who lost money in the scheme, the plea document states. Prosecutors agreed to dismiss the money laundering charge as part of the plea.
“John Oxendine, as the former statewide insurance commissioner, knew the importance of honest dealings between doctors and insurance companies,” U.S. Attorney Ryan K. Buchanan said in a statement. “But for personal profit he willfully conspired with a physician to order hundreds of unnecessary lab tests, costing hundreds of thousands of dollars.”
Prosecutors say Oxendine conspired with Dr. Jeffrey Gallups to pressure other physicians who practiced with Gallups to order unnecessary medical tests from Next Health, a lab in Texas. Prosecutors said Oxendine pushed the plan in a September 2015 presentation to doctors who worked for Gallups’ practice.
The lab company, Oxendine and Gallups agreed the company would pay Gallups a kickback of 50% of the profit on the tests, Oxendine’s indictment said. Next Health paid $260,000 in kickbacks through Oxendine’s insurance consulting company, prosecutors said. Oxendine paid a $150,000 charitable contribution and $70,000 in attorney’s fees on Gallups,’ behalf, prosecutors said, keeping $40,000 for himself. Some patients were also charged, getting bills of up to $18,000 for the tests, prosecutors said.
Prosecutors said Oxendine told Gallups to lie and say the payments from Oxendine were loans when a compliance officer at Gallups’ company asked about them. Oxendine told Gallups to repeat the same lie when questioned by federal agents, prosecutors said. And they said Oxendine falsely said he didn’t work with the lab company or get money from Next Health when interviewed by The Atlanta Journal-Constitution. |
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