Hausfeld clients succeed as interveners in EU Google Android case

On 14 September 2022, the General Court of the European Union in Luxembourg upheld the landmark Google Android decision of the European Commission of 18 July 2018 in all relevant aspects. The comprehensive judgment rendered in Case T-604/18 confirms the EC’s finding that Google LLC and its parent company Alphabet Inc. abused their market dominance on several markets over a span of more than seven years.

In essence, the case concerns several agreements that breached EU antitrust rules, in particular rules on tying and exclusivity. Google concluded such agreements with device manufacturers and mobile network operators as part of the licensing of Android, its operating system for smart mobile devices.

According to the findings of the European Commission, the practices at issue pursued the overall objective of protecting and strengthening Google’s dominant position for general search services and the related search advertising revenues. The condemned conduct hindered the emergence of competitive threats to Google during the crucial shift of Internet consumption from desktop computers to mobile devices – which had represented a window of opportunity for rival search services. As a result, businesses and consumers are deprived of the opportunity of using a broad scope of alternative Internet services today, leading to less choice and innovation and higher prices.

The Commission’s historic decision ordered Google to cease its anti-competitive practices. In particular, the decision required Google to break its tight grip on the entire Android-based mobile ecosystem. The Commission had also imposed a fine of EUR 4.34 billion, the highest fine ever imposed on a single undertaking for a breach of competition law.

Today, the Court upheld the most crucial parts of the Commission’s decision. Only with regard to a form of specific exclusivity agreements (so called portfolio-based revenue share agreements), the Court annulled the decision for procedural reasons. Accordingly, it reduced the fine from EUR 4.34 billion to EUR 4.125 billion, a reduction by only 5%. This outcome is not surprising, as the Chamber had already shown a significant skepticism during the oral hearing as regards the commercial relevance of the effects of such agreements and the Commission’s economic analysis thereof.

Prof Dr Thomas Höppner, counsel to several parties who intervened in the case and partner of the Hausfeld law firm comments on today judgment:

The judgment marks the single most paramount legal defeat in the company history of Google. It goes to the heart of Google’s ecosystem, by tearing down some of the walls Google has built around its cash-cow search service to shield it from competition. The partial annulment relating to the revenue share agreements is of minor relevance as it is a side aspect, as mirrored by insignificant reduction of the fine”.

Philipp Westerhoff, co-counsel to several parties who intervened in the case and lawyer with the Hausfeld law firm, adds:

Today’s ruling is a precedent for numerous pending antitrust investigations around the globe against both Google and Apple for similar abuses of their rulemaking powers within their respective ecosystems. Its precedential value for opening up competition in tightly walled-off digital ecosystems is immense”.

What is Hausfeld’s role in this case?

The judgment marks another landmark achievement for the tech antitrust team of Hausfeld. The Hausfeld team in Germany represented three of the six interveners on the Commission’s side before the General Court of the European Union. These are the French general search service Qwant and the associations BDZV and VDZ, which represent the interests of app developers and content providers in open platform markets. During the previous administrative proceeding, Hausfeld represented one of the five formal complainants – the Open Internet Project (OIP) – along with two interested third parties who submitted their first concerns as early as 2014 (BDZV and VDZ).

Hausfeld has a long history in representing parties affected by an abuse of dominance, in particular in digital markets.

In Germany, Prof Dr Thomas Höppner has spearheaded competition complaints and private enforcement actions against Google since 2009, contributing to landmark decisions and judgments such as Google Search (Shopping), NetDoktor v Google and the German Ministry of Health and Google Android. He has advocated for a competitive and fair Internet on behalf of various digital industries (e.g., comparison shopping, travel, online recruitment services) and digital rightsholders and content producers.

The London team brought several cases against Google as well. Among others, a consumer mass claim for anti-competitive Google practices in relation to the Google Play app store has recently been certified before the UK’s Competition Appeal Tribunal.

The US team recently announced a $90 million settlement in a groundbreaking antitrust class action against Google on behalf of app developers (In re Google Play Store Antitrust Litigation).

Hausfeld is also representing affected parties in investigations relating to Google Ad Tech (European Commission), Privacy Sandbox (CMA), and the Google News Showcase (Bundeskartellamt).

Other News