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Justice Department Files Antitrust Suit Against Google

By Danny Vena – Updated Oct 20, 2020 at 10:46AM

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The search giant is the first to be charged as the government increases its focus on Big Tech.

The U.S. Department of Justice (DOJ) has filed an antitrust lawsuit against Alphabet's (GOOGL -2.75%) (GOOG -3.29%) Google this morning, and the DOJ is holding a briefing to detail the charges. The case alleges that the company has used anticompetitive practices to maintain its stranglehold on search dominance and digital advertising. 

The DOJ claims that Google used a network of exclusionary tactics and competition-stifling contracts to keep rivals from gaining a foothold. The case also charges that by paying billions of dollars to a growing list of phone carriers, manufacturers, and third-party browsers including Apple's (AAPL 2.44%) Safari, Google retains its status as the default search provider, thereby stifling competition.

A gavel near a laptop with piles of 100 dollar bills and a scale nearby.

Image source: Getty Images.

An investigation into Google's practices has been ongoing for more than a year as the U.S. government seeks to crack down on several of the world's largest technology companies for the vast influence they exert over consumers. This includes fellow tech titans Facebook (META -1.19%), Amazon (AMZN -8.43%), and Apple, all of which could face similar antitrust suits in the coming weeks and months.

Google controls more than 80% of the search market in the U.S. and an estimated 92% worldwide, drawing the gaze of regulators across the globe. The company has been the target of numerous antitrust complaints brought by the European Union, resulting in total fines of about $9 billion over the past several years.

The DOJ case was joined by 11 state attorneys general, according to court filings, while many other attorney generals are contemplating bringing their own charges. This follows a recent report by the antitrust panel of the House Judiciary Committee, which found that the benefits of the digital economy were concentrated among the four tech companies, resulting in a "compelling need" for antitrust enforcement. 

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Danny Vena owns shares of Alphabet (A shares), Amazon, Apple, and Facebook. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, and Facebook and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool has a disclosure policy.

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