With just three days to go until Thanksgiving, the atmosphere for closing arguments in US v. Google on Monday morning in Alexandria was oddly festive.
A crowd of lawyers, journalists, Google employees, ad tech observers and various gadflies milled around chatting outside of Courtroom 700 on the seventh floor of the US District Court for the Eastern District of Virginia, waiting for the doors to open and proceedings to start promptly at 10 a.m.
The trial itself took place during three rapid-fire weeks of testimony in September presided over by Judge Leonie Brinkema, whose job it is to decide whether Google operates an illegal monopoly in the ad tech market.
Speaking of, Monday was Google’s and the DOJ’s final chance to make their respective cases to Judge Brinkema before she retires to mull the evidence and make her ruling by sometime early next year.
Both sides were given roughly 90 minutes apiece to present, and Judge Brinkema had the opportunity to interrupt and ask questions throughout. She had some great ones.
Judges typically play their cards close to the vest, which was also true here. But Judge Brinkema’s interjections shed a little light on how she’s thinking about the case.
‘Google doesn’t control the facts’
Aaron Teitelbaum, a senior litigation counsel in the DOJ’s Antitrust Division, had the first crack at the lectern.
He started his closing with the accusation that, for more than a decade, Google has rigged online ad auctions and extinguished competition.
“Google is once, twice, three times a monopolist,” Teitelbaum said, referring to the government’s argument that Google illegally dominates the ad server, ad network and ad exchange markets.
The DOJ proved its case, he said, through the testimony of real industry participants – the ad tech companies, publishers and agencies that live and breathe this stuff every day.
At which point Judge Brinkema broke in to ask why the government didn’t call any actual advertisers, because it’s their money after all.
Teitelbaum responded that it made the most sense to call agencies because they’re the ones that know how the ad tech tools work.
The only live witness Google brought that wasn’t either on its payroll or the recipient of a Google grant, Teitelbaum said, was a single representative from the Census Bureau.
Google may control the markets, he said, “but Google doesn’t control the facts.”
One market vs. three
But to argue that Google controls one or multiple markets, the DOJ has to prove those markets exist.
Direct evidence of monopoly power, according to Teitelbaum, is the ability to control prices and saddle customers with products they don’t want without fear of losing their business. And that’s just what Google did with its release of unified pricing rules in 2019, he said.
“Yes,” Judge Brinkema retorted, “they can’t go anywhere else if they want Google’s demand. … [but] does it truly make a difference in the long run if the court decides there is one monopoly or three?”
Teitelbaum acknowledged that, no, perhaps it doesn’t matter. But the DOJ is sticking to its once, twice, three times a monopolist argument.
‘Competition knows best’
Why would Google release unpopular products like unified pricing rules or devise secret initiatives to hamstring header bidding, like Project Poirot, if it has the best interests of its customers at heart?
It boils down, Teitelbaum said, to a “Google knows best mentality.”
“But Google doesn’t know best,” he said, warming to his rhetoric. “Competition knows best. Freedom of choice knows best. … It’s Google versus its customers and not Google versus its rivals.”
Judge Brinkema had a little something to say about that one: “But isn’t it about Google versus its rivals?” she said.
The fees get charged at the exchange level, after all.
‘The better widget’
As Teitelbaum was wrapping up, he referenced past testimony by Dr. Mark Israel, Google’s economic expert, who said during the trial that integrating products is inherently pro-competitive.
But you can’t just say integration is better and leave it at that, Teitelbaum said. You must prove it.
Okay, Judge Brinkema said. What if there were solid evidence to prove that integrated products are better?
Google would have to demonstrate that the benefit of an integration outweighs any competition issues, Teitelbaum said.
Well, Judge Brinkema pushed, what if a company simply “has the better widget,” and customers are willing to pay more for it?
Except the product isn’t better in Google’s case, Teitelbaum said, noting that the court has heard testimony from multiple publishers, including Stephanie Layser, formerly of News Corp, who said they felt trapped by DoubleClick.
Judge Brinkema paused for a moment and then asked: Can you share any examples of products that are better than what Google has to offer?
Teitelbaum also paused.
Kevel could have been one, he said, but it didn’t have the chance to succeed due to the tie between DFP and Kevel’s lack of real-time access to Google’s demand through AdX. The same has been true for Equativ. And publishers like Gannett, he said, would have switched to another ad server, but they felt stuck with DFP.
The spoliation question
And then it was Google’s turn.
Google’s lead attorney, Karen Dunn, began with broad, scene-setting points, including that prices have gone down overall and innovation has increased.
“The exact opposite of proof in a monopolization case,” she said.
Meanwhile, she said, the DOJ hasn’t proven its market definitions or the existence of anticompetitive behavior. And, anyway, much of the conduct in this case is old, the most recent being unified pricing rules from back in 2019.
Dunn then accused the government of cherry-picking unflattering excerpts from documents without providing the full context.
For example, the DOJ has often cited a 2016 email written by Jonathan Bellack, Google’s former director of product management, in which he wrote, “Is there a deeper issue with us owning the platform, the exchange, and a huge network? The analogy would be if Goldman or Citibank owned the NYSE.”
The DOJ has referred to this as an example of Google “saying the quiet part out loud.”
On the stand in September, however, Bellack characterized his email as “late-night, jet-lagged ramblings.”
The fact is, Google fosters a culture of debate and the free sharing of ideas, Dunn said during her closing. Not every offhanded email is a smoking gun.
At this point, Judge Brinkema broke in again. “You’re in dangerous territory when you talk about what Google employees were thinking,” she said, “because in a lot of cases we don’t know.”
(Google escaped sanctions for destroying evidence in the search antitrust case, but it did get a serious tongue-lashing from Judge Amit Mehta on the subject. It’s not clear how Judge Brinkema will address Google’s spoliation – which is the act of destroying or otherwise suppressing evidence – in her decision next year. We’ll have to wait and see.)
Unique demand?
Dunn also spent a chunk of her time dismantling the DOJ’s arguments about product exclusivity, including the notion that customers need to use AdX for access to Google Ads demand and that real-time access to AdX is available only through DFP.
A question at the heart of this case is whether Google actually has unique demand, Dunn said. Lots of companies talk about having unique demand. It doesn’t mean they actually do, she said.
But multiple publishers have taken the stand to testify that they felt locked into DFP with no recourse. “Isn’t that proof of unique demand?” Judge Brinkema asked.
The whole case, Dunn said, is about the DOJ wanting Google to allow rival exchanges to integrate with DFP so they can get real-time access to Google Ads demand – when, in reality, they can access this demand in other ways, including through AdSense and DV360.
The truth, she said, is that publishers do have access, just not in “the exact way they want.”
The Amex argument
Dunn then segued into another cornerstone of Google’s defense, which is that its ad tech tools operate in a single, two-sided marketplace with buyers on one side and sellers on the other.
You can’t think about a marketplace in isolation, Dunn argued, referring – as Google’s attorneys did many times throughout the case – to Ohio v. Amex, a landmark 2018 Supreme Court decision, which found that a court in an antitrust case has to consider the network effects that arise from a transaction.
Conduct might end up looking anticompetitive when you only consider the impact on one party, as the DOJ did – as in, the impact on publishers – and not how that same behavior may have actually helped the party on the other side, meaning advertisers, Dunn said.
But Judge Brinkema jumped in with a little skepticism.
Although she liked the Amex argument at first, she said she’s become less convinced over time.
“I’ve read the Amex case more times than I probably should’ve,” she said. “Early in the case it felt very attractive … but now it seems to me we’re dealing with a completely different setup.”
A case of two tales
The DOJ got the last word before the trial portion of the case wrapped for good.
Julia Tarver Wood, a senior DOJ attorney, took the last 20 minutes of allotted time to drop numerous zingers, including a reference to “A Tale of Two Cities” by Charles Dickens.
This case, she said, was a case of two tales, one told by actual market participants and one by people paid by Google, like Dr. Israel, whose advice for publishers is to, essentially, “let them eat cake,” she said.
If publishers aren’t happy, Wood said, they can just stop using Google’s ad server and spend $100 million to build their own or convert all of their readers from web to app, or simply try to sell more inventory directly.
“It ain’t that simple,” Wood said.
And then it was over. Judge Brinkema cut off Wood and said, “You started out with a reference to ‘A Tale of Two Cities,’ which has a guillotine in it – and I’m about to use it!”
As in, time to finish up.
All we ask in this case, Wood said in the closing of her closing, is that the court applies the law and considers the facts as lived by people with firsthand experience in this market.
But there won’t be a decision in this case until early next year, and the holidays are coming, which means there’s time to do a little reading that doesn’t involve lengthy legal documents.
And guess what? “A Tale of Two Cities” is in the public domain. Enjoy!
