Google Faces £5 Billion UK Lawsuit

Source Credit : CNBC

Google is being sued for £5 billion ($6.6 billion) in potential damages in the U.K. over allegations that the U.S. tech giant abused its “near-total dominance” in the online search market to drive up prices.

A class action lawsuit filed Wednesday in the U.K. Competition Appeal Tribunal claims that Google abused its position to restrict competing search engines and, in turn, bolster its dominant position in the market and make itself the only viable destination for online search advertising.

It is being brought by competition law academic Or Brook on behalf of hundreds of thousands of U.K.-based organizations that used Google’s search advertising services from Jan. 1, 2011, up until when the claim was filed. She is being represented by law firm Geradin Partners.

“Today, UK businesses and organisations, big or small, have almost no choice but to use Google ads to advertise their products and services,” Brook said in a statement Tuesday. “Regulators around the world have described Google as a monopoly and securing a spot on Google’s top pages is essential for visibility.

“Google has been leveraging its dominance in the general search and search advertising market to overcharge advertisers,” she added. “This class action is about holding Google accountable for its unlawful practices and seeking compensation on behalf of UK advertisers who have been overcharged.”

Google called the case “yet another speculative and opportunistic case” and said that it plans to “argue against it vigorously.”

A 2020 market study from the Competition and Markets Authority (CMA) — the U.K.’s competition regulator — found that 90% of all revenue in the search advertising market was earned by Google.

The lawsuit claims that Google has taken a number of steps to restrict competition in search, including entering into deals with smartphone makers to pre-install Google Search and Chrome on Android devices and paying Apple billions to ensure Google is the default search engine on its Safari browser.

It also alleges Google ensures its search management tool Search Ads 360 offers better functionality and more features with its own advertising products than that of competitors.