September 7, 2010
Elevated scrutiny over Google has lead the Texas attorney general's office to conduct an antitrust review of Google Inc.'s core search-engine operations.
The lead prosecutor of Texas has pursued allegations made by several small businesses that the search giant unfairly devalued their ranking results or ad placements in the search engines, Google said Friday.
Google disputed the allegations, tracing them back to three companies that have ties to industry rival Microsoft Corp.
Texas Attorney General spokesman, Greg Abbott, announced that an investigation of Google was taking place but declined any further comment. A spokesman for Microsoft had declined comment.
The company is sometimes asked about the fairness of the search engine and why some websites are ranked higher than others, said Don Harrison, a deputy general counsel at Google, in a blogpost.
"Given that not every website can be at the top of the results, or even appear on the first page of our results, it's unsurprising that some less relevant, lower quality websites will be unhappy with their ranking," Mr. Harrison wrote.
Google claimed the investigators requested information about the cases of Foundem.co.uk, TradeComet.com LLC and myTriggers.com Inc., which have each claimed that Google unfairly demoted their search result rankings.
TradeComet, a business-focused search engine portal, has sued Google in federal court, however the case was dismissed. MyTriggers, a price comparison web resource, also sued Google in Franklin County, Ohio - neighboring others known for home remodeling Cuyahoga County
. Google objects to any wrongdoing.
The European Commission is following suit by conducting a preliminary inquiry into a dispute set by British price comparison website, Foundem. Google has denied any violations to the laws in Europe.
Google claimed Foundem is supported by ICOMP, an organization funded greatly by Microsoft. The search company added that TradeComet and myTriggers are represented by the same antitrust lawyers Microsoft uses, it said in a blogpost.
Other legal professionals, such as one Savannah business litigation lawyer
, are analyzing the antitrust issues of the case. Two other specialists who have found unique interest in the case are John Schmidt, Roanoke business lawyer, and Elliot Mardson, Oklahoma City commercial litigation lawyer
Microsoft, which is a main competitor with Google in a number of businesses, has acknowledged aiding the complaints of small businesses about Google. However, Microsoft has objected to supporting their antitrust suits. The owners of Foundem, SourceTool and myTriggers have all denied any affiliation of representing Microsoft in any way.
Chief executive of TradeComet, Dan Savage, said: "Obviously, Google is just trying to distract from its own problems by pointing to others and their lawyers."
A myTriggers spokesperson added: "Though there are probably a lot of other victims too, MyTriggers' concern is just the harm to MyTriggers done by Google's anticompetitive conduct and bullying tactics. We have a strong antitrust claim and look forward to our day in court."
Mr. Abbott, who is opting for a fall re-elect, has past experience in antitrust cases for the state of Texas. Abbott and his team of business litigation lawyers have been analyzing the market for electronic-books, which witnessed price hikes for some titles being distributed and sold by Apple Inc. for its iPad, individuals familiar with the issue have claimed. Mr. Abbott reached a $28 million settlement against the top Indianapolis drug lawyer
with Abbott Laboratories over alleged false reporting of drug prices back in 2008.
In pinpointing Google's core business operations, Texas has taken an authority step ahead of the federal agencies charged with enforcing antitrust laws in the U.S., the Justice Department and Federal Trade Commission. Both agencies have performed antitrust evaluations of the search giant's transactions.
A recent example occurred when The Justice Department motioned to block Google's advertising deal with rival Yahoo Inc., forcing the company to cut the deal. This year, the FTC allowed Google to purchase mobile advertising company AdMob for $750 million.
Currently, The Justice Department performing an overview of Google's $700 million buyout of ITA Software Inc. ITA is force behind the airfare search for a number websites including Microsoft's Bing search engine.
But neither The Justice Department or the FTC has the reputation to have performed a monopolization inquiry that targets Google's business in search engine placement and advertising. Google takes more than 65% of the pie for all U.S. search queries, and an even larger slice for total search advertising revenue. The company manages about 90% of search queries in some countries such as France. Many companies around the globe rely on Google SEO
to help drive traffic to their websites.
On Friday, Google agreed to pay $8.5 million to cover attorneys' fees and establish an education fund to resolve a class-action suit that alleged its social-networking service violated the privacy of its users. From the start, the service created a network of social contacts based from Gmail, Google's free email service. Each user's contacts network was visible to others.
After overwhelming complaints, Google altered the settings so that user's contacts were kept private by default. The prompt action was taken in an effort to facilitate business risk assessment
for future users.
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