Mark Zuckerberg and Sundar Pichai were involved in conspiracy conspiracy, court claims

On Friday, a coalition of attorneys general led by Texas Attorney General Ken Paxton released a new antitrust complaint (PDF) against Google, detailing the company’s alleged collusion with Facebook in programmatic advertising markets. The submission was first reported by Politics.

First filed in November, the first complaint (PDF) alleged wide-ranging collusion between the two companies, most notably in a collaborative project codenamed “Jedi Blue,” in which the companies collaborated to limit bidding practices via headers.

Based on internal emails, Friday’s complaint shows that the Jedi Blue deal has been assessed at the highest level of both companies, with personal involvement from Sundar Pichai, Sheryl Sandberg and Mark Zuckerberg. In an email to Zuckerberg, Sandberg told the CEO:[t]he is a big problem strategically.” Specifically, the application references Zuckerberg and Sandberg by their job titles, but their names are redacted.

The legal implications of the allegations are still disputed, and the distinction between normal business practices and anticompetitive behavior will be hotly debated in court. Still, the Attorneys General manage to dig up some moments when the two advertising giants seem to nest in a duopoly.

In a particularly inconvenient passage, the complaint cites a 2015 email in which “Google employees expressed fears that Google’s exchange might ‘actually compete’ with other exchanges at some point in the future.

Much of the case rests on the concessions Google reportedly made to Facebook in the wake of the Jedi Blue settlement, including lower fees and longer timeout limits on trade bids. A newly unredacted portion of the complaint alleges that the concessions gave Facebook a clear advantage in winning auctions.

A 2019 Facebook survey found that Facebook’s bids for in-app impressions won more often in Google-led auctions than on any other platform. At the same time, the average price Facebook paid per in-app impression was lower in Google-led auctions than on any other platform. This would be a puzzling result to say the least if Facebook faced the same competition for inventory at auction houses.

The case comes amid a series of antitrust actions against Google, including parallel antitrust lawsuits targeting search manipulation and the management of the Google Play Store. But the Texas-led complaint is arguably the most significant for the company, targeting the programmatic ad networks that have long provided the bulk of the company’s revenue.

Google did not immediately respond to a request for comment, but described the complaint as “full of inaccuracies and lacks legal value” in a statement to Politics.