Google and Facebook signed a secret deal in 2018 that gave the social media network an unfair advantage in online ad auctions, claims a federal antitrust lawsuit.

The lawsuit, led by Texas AG Ken Paxton (R) and backed by 14 other states and Puerto Rico, was filed in December 2020 and updated last week at the best of a judge who sought to make more details available to the public. 

According to newly unredacted documents, Google contacted Facebook in 2017 when the social media company began to emerge as a serious rival for online advertising. 

After meetings negotiated primarily by Facebook COO Sheryl Sandberg, who worked previously for Google as head of online ad sales, Facebook agreed to cut back on the competition in exchange for guaranteed victory in a certain percentage of ad auctions. The agreement was signed by Facebook CEO Mark Zuckerberg and Google CEO Sundar Pichai. 

Like its secret deal with Apple (click here to read more), Google’s agreement with Facebook is a clear violation of federal antitrust law designed to effect a monopoly in the advertising technology market. 

“Google sought to kill competition and has done so through an array of exclusionary tactics, including an unlawful agreement with Facebook, its largest potential competitive threat, to manipulate advertising auctions,” reads the suit. “The Supreme Court has warned that there are such things as antitrust evils. This litigation will establish that Google is guilty of such antitrust evils, and it seeks to ensure that Google won’t be evil anymore.”

Google described the lawsuit as “full of inaccuracies” and plans to file a motion to dismiss. 

“Our advertising technologies help websites and apps fund their content, and enable small businesses to reach customers around the world,” said Google spokesman Peter Schottenfels.

Facebook, which is not a defendant in the suit, described the deal with Google as a “business relationship” no different than agreements with other bidding platforms. 

Author’s Note: Google faces similar accusations from the Department of Justice and more than 200 newspapers who claim the search engine unfairly manipulates the online ad market.

Sources:

Zuckerberg and Google CEO approved deal to carve up ad market, states allege in court 

https://www.politico.com/news/2022/01/14/facebook-google-ad-market-lawsuit-527108

Facebook and Google accused of ‘secret deal’ to carve up ad empire 

https://nypost.com/2022/01/14/facebook-and-google-accused-of-secret-deal-to-carve-up-ad-empire/

Lawsuit claims Google and Facebook brokered secret deal to dominate ad market 

https://www.foxbusiness.com/politics/lawsuit-google-facebook-brokered-secret-deal-dominate-ad-market

25 thoughts on “Texas Lawsuit Exposes Google’s Secret Deal With Facebook”
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