Google Wins Major Antitrust Victory In Brazil, Does It Foreshadow Broader EU & US Wins?

In addition to the various government antitrust investigations against Google going on around the world, there is a parallel world of private lawsuits by Google rivals and critics that make similar unfair competition or antitrust claims against Mountain View. They generally allege, among other things, that Google is unfairly referring traffic to its own “vertical sites” and thereby violating antitrust or fair competition rules.

Comparable issues are at the heart of the European Comission’s “four concerns” that are now the basis for antitrust settlement talks with Google. The same or similar arguments are also used against Google in the US. (The FTC is now weighing a “go or no go” decision about whether to bring an antitrust case in the US.)

Summary Judgment Granted for Google

One of those private antitrust litigants against Google was the parent of Brazilian shopping comparison site Buscapé. However, at the end of last week Google was granted summary judgment (see translated decision below) against the company. That effectively ended the case in Google’s favor. A motion for summary judgment (under US law) is only granted if all plaintiffs’ factual allegations are assumed to be true and there is still no legal remedy available. The Brazilian legal standard appears to be the same or substantially similar.

What’s striking and relevant about the Brazilian case is its similarity to cases and claims against Google around the world. In addition, the Brazilian court seemed to base its ruling and decision on general legal principles rather than specific Brazilian statutes or competition rules.

Plaintiff’s Factual and Legal Claims

Buscapé’s parent company made the following claims in the case:

[Google] manipulates its search service, that controls 95 percent of the market, for the purpose of:

i) allowing only GOOGLE SHOPPING to display images of the searched merchandise, which is not permitted to BUSCAPÉ and BONDFARO;

ii) embezzling and usurping the database of reviews – clients’ evaluations of the purchases gathered along more than 10 years by BUSCAPÉ, BONDFARO and E-BIT sites;

iii) artificially including GOOGLE SHOPPING in the first ranks of the search results, whenever a consumer conducts a query for the purchase of products in Google Search, thus harming the other competitor sites owned by Plaintiff.

The Court: Google Not a Monopoly, No Obligation to Plaintiff

Despite the assertion that Google owns “95 percent of the market” in Brazil, and the procedural “assumption” that plaintiff’s factual allegations are true, the Brazilian court was not persuaded by any of plaintiff’s arguments. It rejected every one of plaintiff’s arguments.

Google isn’t a monopoly: “There are several search services at the disposal of the consumers who are looking for products, and at the disposal of the merchants intending to attract consumers [i.e., Bing, Yahoo, Ask]. Google’s leadership in the internet search segment in Brazil cannot be mistaken with a monopoly of that activity . . .  Plaintiff does not need and is not dependent on Google Search to [be found by consumers]. The users may access Buscapé and Bondfaro sites without passing through Google.”

Google Shopping isn’t a separate “product”: “Google Shopping is not a shopping comparison site like Buscapé and Bondfaro . . . Google Shopping is one more among the thematic search options of Google search . . . Google Shopping is not a “site” to compare prices, but just a thematic search option within the generic search made available by Google Search.” (This is the argument Google makes about the relationship of general search to its “verticals”: they can’t be separated from Google search results.)

Google can present search results in whatever order or manner it deems appropriate: “[Google] admits that the display order of the most relevant results is based on its algorithmic formula, developed with the clear intention of ranking first the results which best fit its criteria of quality and relevance to meet user’s actual intention. And nothing prevents [Google], in the conduction of its profit corporate business, from developing and using a tool (algorithmic formula) that returns results to a user query in Google search in a display order dictated by Google’s quality and relevance criteria.”

Display of plaintiff’s product reviews is not a copyright violation: Plaintiff had claimed that Google’s display of reviews from its Buscapé site constituted a kind of embezzlement and copyright violation. The court disagreed, citing a kind of “fair use” theory: “[E]ven if [one] considers that the Plaintiff organized said evaluations and that the comments selection and their presentation format are sufficient to consider the data base to be an intellectual work subject to copyright protection  . . . actually, there is no embezzlement in the use of said database by [Google] . . .

From a search of any product (such as 40″ LCD TV set, for example), made in Google site, whether a generic or thematic search (with the “shopping” theme), the information inherent to the pages indexed by Google search will appear in all results, regardless of the ranking, so that the internet user can see the results and have the minimum elements to decide on which result he should click, that will lead him directly to the desired page . . .

In other words, each result displayed by a search engine such as Google, necessarily brings portions of the respective page (of the result) on the internet.”

Now in (Plain) English

This Brazilian ruling technically and legally has no impact on US authorities or anyone else around the world. However the court is using certain kinds of broad legal ideas and arguments that exist as potential defenses in both the US and Europe (to varying degrees). And the plaintiff’s claims in the case are very similar to arguments that Google opponents have made or are now making.

Basically what the court said was the following:

  • Despite Google’s overwhelming search market share, plaintiff’s shopping sites have other ways to be found. Google isn’t a monopoly.
  • Google’s vertical results aren’t competitive “products,” they’re just a part of Google’s search results
  • Google owes no duty to present plaintiff’s site(s) in a particular position; Google can present search results in whatever manner and order it deems best for its users

If Google had been considered a monopoly the outcome would have been quite different in all likelihood. But that finding wasn’t made here.

Google is probably going to “double down” on these defenses (articulated by the court) though it will seek to negotiate settlements if possible to avoid litigation or comparable adversarial process in Europe.

As one “remedial” measure Google is now labeling many of its vertical or “thematic” results with a “sponsored” badge, such as these examples in travel:

Google will likely broaden this approach as a kind of compromise measure to satisfy regulators. However, it doesn’t really address critics’ central concern about being pushed to the bottom of the page or otherwise overshadowed by Google’s “own content.”

As a practical matter there’s probably nothing they can do about it — except to buy AdWords for visibility.

BUSCAPÉ vs. Google Summary Judgment ruling

Related Topics: Channel: Industry | Features: Analysis | Google: Antitrust | Google: Critics | Google: Legal | Google: Outside US | Google: Web Search

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About The Author: is a Contributing Editor at Search Engine Land. He writes a personal blog Screenwerk, about SoLoMo issues and connecting the dots between online and offline. He also posts at Internet2Go, which is focused on the mobile Internet. Follow him @gsterling.

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  • Hillz

    Can google afford to buy…ahem, I mean influence a Brazilian judge? Not saying they did…but after reading articles like this – http://www.guardian.co.uk/world/2012/aug/02/brazil-corruption-trial-politicians, could it be possible?

  • cjvannette

    You know how much money Google has. They can afford to buy anyone who’s for sale.

  • Jenner Cruz

    People can be bought all over the world. But I don’t think it could happen in this case. Both parties have skilled lawyers, money and media attention. Nobody would dare to bribe a judge under so bright spotlight.

  • Jonatas Leonel

    Man, most of brazilian judges are corruptible, you don’t need too much to buy a sentence there. Unfortunately that’s the reality of that country.

  • ScottyMack

    Glad to hear this ruling. For some reason, people think Google owes the world some sort of fairness in their search results. Would I like to be higher in their results? You bet! Do I feel like I am entitled to it? No way! It’s their search engine, it’s their company, it’s their website. They can do whatever they want to with it.

    Hey, all you people running websites with affiliate links: where are the links for websites NOT paying you a commission for your referral? By many people’s twisted logic, you should be required to show ALL possible places that have similar products – not just the ones that make you money. And, down that same line, you certainly better not be showing ones that earn you a better spiff in better positions on your pages and with better ratings than ones that don’t pay as much.

    Yeah, the decisions of these judges apply to more than just Google. Remember that!

  • James Lan

    It is a case ruled by a judge with wisdom and intelligence.

  • James Lan

    there are corruptions in US too, maybe Apple bought over the judge and jury in the case against Samsung , do you agree?

  • Maurice Walshe

    95% share is a de facto monopoly in practice – and I am not sure that would acept some of the judges resoning as “resonable” here.

    A parallel argument woudl be that some one like say BT in the UK does not need to do LLU or regulating becuase of KCom (which only serves a tiny % when compared to BT)

  • daveintheuk

    Bad news for the internet.

  • Alistair Dent

    That parallel doesn’t work, because of the cost involved to the consumer.

    If I decide I don’t want a BT line then I go to somebody else who can provide infrastructure. The cost involved in that is huge so it’s a disincentive to me as a consumer to use a different service, thereby allowing BT to offer me uncompetitive prices.

    But if I as a consumer don’t want to see Google’s search results I simply use another one. I haven’t been charged by either service, nor is there any burdensome difficulty for me in making the switch.

    Monopoly rules exist to protect consumers from behaviours that harm them. Not to protect competitors.

  • http://www.facebook.com/people/Thiago-Almeida/100001893880101 Thiago Almeida

    Not sure if a lot of corruptible judges or a whole lot of inferiority-complexed people, apologizing for being born there, claiming stuff with no basis at all.

  • Knowles2

    Hopefully there a couple of wise and intelligence judges in the US and EU.

  • Maurice Walshe

    and if you dont appear on google shopping the 5% or so scraps from bing and yahoo are not the same so your example falls down.

    Antitrust cases are not always about the consumer this one is about harming the other players in the game just as Microsoft and IBM did.

    IBM in particular was hammered for what it did to its competitors not the end users of its mainframes.

  • http://twitter.com/nelsond25 Nelson D

    “As a practical matter there’s probably nothing they can do about it — except to buy AdWords for visibility.”

    Yeah especially since shills like you still shill for Google and call
    them a “search engine,” instead of an ad engine. It’s getting old and
    you and Danny will lose any shred of credibility you may have had.
    Google is also manipulating “organic” search to force sites to advertise
    for traffic and to increase PPC. Where are you with that Panda and
    Penguin report, Mr Shill? Why are Google’s earnings and ad clicks going up every time they “improve quality” ?

    By the way: 95% market share is a monopoly in US and EU no matter how
    much saddens you Greg. Besides Windows, we had Unix, Linux, Apple etc.

  • MeZmer1Ze

    Don’t mean to be rude.. but google is a website.. you don’t like it, go elsewhere… Microsoft is using desktop Windows to try to force people to like it’s Phone OS… Apple also tries to leverage it’s market wins to push their other products. Why are they allowed to and not Google? Google are NOT the only ad company.. yahoo, Microsoft, Apple, ASK etc etc. all have their own add networks tied to their products. If Google is not a search engine because they don’t rank their competitors above themselves, then I rather expect that we don’t have any “real” search engines left.

    Compete on merits, not litigation. Google isn’t like Microsoft, IE doesn’t default to Google by default and you can leave google any time you like and it costs you nothing.

    I’m glad there are still courts in the world that make sense.

    cheers

    Frank

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