The DOJ’s Problematic Remedies Proposal in the Google Ad Tech Case
Following Judge Brinkema’s landmark decision finding that Google monopolized the ad exchange market connecting publishers and advertisers—where Google offers its AdX product—and the separate ad server market—where Google offers its DoubleClick for Publishers (DFP) solution that, among other things, helps publishers manage their ad inventory—the Department of Justice (DOJ) has put forward a series of proposed remedies to address Google’s supposedly anticompetitive behavior. Like in the ongoing search case, which is wrapping up a highly contentious remedies trial, the DOJ seeks broad relief that includes divestitures, a number of injunctive prohibitions, as well as several other obligations on Google it believes will restore lost competition and/or deny the company the purported fruits of its statutory violations.
As the DOJ’s proposal explains, it is well recognized that a core purpose of antitrust remedies is to “unfetter a market from anticompetitive conduct.” To that end, the DOJ generically requests that Google “be enjoined from all conduct determined by the Court to be anticompetitive.” Of course, two of the four practices that Judge Brinkema found to be unlawful—namely, Google’s First Look and Last Look policies, which were designed to give publishers higher bids through AdX—are no longer even in place. As such, Google would just be left to open up real-time AdX access to rival ad servers and modify its Unified Pricing Rules, steps which the company has proposed to undertake in its own remedies brief.
But that’s not all of the “prohibitions on distorting the competitive process” the DOJ is asking for. Indeed, the rest of the DOJ’s list involves limitations on Google using buyside tools like its AdWords ad network and demand-side platform DV360 to benefit its AdX or DFP products. However, this sort of anticompetitive leveraging of any buyside market power to monopolize ad exchanges or ad servers was not identified by Judge Brinkema to be unlawful. To be sure, while courts do have the authority to “ensure that there remain no practices likely to result in monopolization in the future,” many of these behaviors—most notably, the restriction of the AdWords advertising demand to AdX—were alleged by the DOJ to be anticompetitive but not expressly found by Judge Brinkema to constitute a Sherman Act violation. Simply put, it makes little sense for the DOJ to get relief for practices it tried and failed to prove were anticompetitive.
To make matters worse, the DOJ’s remedies proposal also includes four “data and transparency” measures the DOJ believes will address Google’s “data and scale advantages,” which it alleges constitute the “‘fruits of its statutory violation’ that Google must be ‘den[ied]’ in order to restore competition.” And yet, the two most significant remedies in this bucket concern the use of data as it pertains to advertising buyer tools, which was a space Judge Brinkema analyzed but found that Google had not monopolized. What’s more, a third measure involves “allow[ing] publishers to access data generated in DFP or AdX from their inventory in the same format as Google can access said data,” which appears more to be a gift to publishers than something that will meaningfully restore competition in either the ad server or ad exchange markets.
The last of the data and transparency remedies, which requires Google “to share DFP data that improves auction logic with the industry organization hosting the open-source final publisher ad server auction,” is merely part of the DOJ’s scheme to ultimately force Google to divest DFP. Of course, while the DOJ notes case law asserting courts’ power to “terminate the illegal monopoly,” Judge Brinkema’s opinion essentially found that DFP was not an illegal monopoly by virtue of concluding that the DOJ has “not shown that the acquisition of DoubleClick was anticompetitive.” As such, and in light of all the behavioral remedies proposed by the DOJ with respect to DFP, there seems to be little ground for concluding that a divestiture is necessary.
A similar story can be told with respect to the DOJ’s desire to force Google to divest AdX. That is, despite acknowledging the importance of Admeld to Google’s AdX success, Judge Brinkema did not find that the transaction was anticompetitive. Accordingly, it stands to reason that the DOJ is hard pressed to justify a blanket AdX divestiture. What’s more, the key Microsoft case was clear that divestitures require the DOJ to show that “but for” the behavior actually found to be anticompetitive, Google would not have successfully monopolized. However, Judge Brinkema did not expressly apply this causation standard when determining whether Google monopolized the AdX space, placing a high burden on the DOJ at trial to achieve an AdX breakup.
Finally, the DOJ’s remedies proposal would be bad enough if, like in the search case, it sought the divestiture of both DFP and AdX only if divesting one of the two products, along with other behavioral remedies, were somehow deemed insufficient. Here, however, it wants both divestitures without conditions. But that’s just not a reasonable position: even if divesting either DFP or AdX were justified, that would be more than sufficient to address the behavior that Judge Brinkema found to be anticompetitive, and specifically anticompetitive leveraging from AdX to DFP—namely, restricting real-time AdX access to DFP—or from DFP to AdX—for example, allowing last look bids only through AdX. In other words, by divesting either its AdX or DFP solutions, the incentive and ability for Google to engage in this sort of behavior would disappear.
While there was little doubt that the Trump administration would continue to apply heavy antitrust scrutiny on Big Tech, and perhaps especially Google, it was an open question whether it would pursue the breakups favored by the neo-Brandeisians in the Biden administration who saw big as inherently bad. However, following its doubling down on the Biden administration’s decision to seek a breakup in the search case, the DOJ’s remedies proposal in the ad tech matter makes clear, echoing statements in a recent speech by AAG Slater, that for MAGA antitrusters concerns about “Big Business” and “Tryanny.com” appear to have trumped not just fashioning legally sound antitrust relief, but winning the United States’ geopolitical competition with China—the real authoritarian threat to the American ideals of liberty and democracy.
