Google and Facebook Reportedly Agreed to Cooperate in Antitrust Actions

Google and Facebook reportedly agreed to 'cooperate and assist one another' if they faced an investigation into their pact to work together in online advertising.
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Alphabet's Google  (GOOGL) - Get Report and Facebook  (FB) - Get Report agreed to "cooperate and assist one another" if they ever faced an investigation into their pact to work together in online advertising, according to an unredacted version of a lawsuit filed by 10 states against Google last week.

The Wall Street Journal reported additional details it uncovered in the suit, including part of a recent draft version without redactions that it reviewed that provided more detail and context on findings and allegations in the court documents.

Ten Republican attorneys general, led by Texas, have alleged that the two companies cut a deal in September 2018 in which Facebook agreed not to compete with Google's online advertising tools in return for special treatment when it used them.

Google used language from "Star Wars" as a code name for the deal, according to the lawsuit, which redacted the actual name. The draft version of the suit reviewed by the Journal said it was known as "Jedi Blue," the newspaper said.

The lawsuit itself said Google and Facebook were aware that their agreement could trigger antitrust investigations and discussed how to deal with them, in a passage that is followed by significant redactions, according to the Journal.

The draft version spells out some of the contract's provisions, which state that the companies will "cooperate and assist each other in responding to any Antitrust Action" and "promptly and fully inform the Other Party of any Governmental Communication Related to the Agreement."

In the companies' contract, "the word [REDACTED] is mentioned no fewer than 20 times," the lawsuit said. The unredacted draft fills in the word: Antitrust.

A Google spokesperson told the Journal that such agreements over antitrust threats are extremely common.

Facebook and other tech giants including Amazon.com (AMZN) - Get Report and Apple (AAPL) - Get Report have been accused of using their size and reach to direct consumers to their own products and services, stifling competition in the process.

Specifically, federal and state antitrust authorities are probing whether Facebook and Google are taking advantage of their size and platforms in search and advertising practices - in Facebook’s case through third-party platforms it owns like Instagram and WhatsApp.

In addition to the suit filed in Texas, Google was hit last week in a separate antitrust lawsuit joined by 38 attorneys general, which alleged that it maintained monopoly power over the internet-search market through anticompetitive contracts and conduct.

Google also has disputed the contentions in that suit, as well as a previous lawsuit filed by the Justice Department in mid-October over alleged monopoly practices.

Shares of Google were down 0.47% at $1,726.37 in trading on Tuesday. Shares of Facebook were down 0.88% at $270.39.

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