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Google Ruling Shows Need For Do Not Track And Strong Antitrust Action

12:48 pm in Uncategorized by Consumer Watchdog

Gavel

A federal judge’s ruling late Friday in a key privacy case demonstrates the need to implement tough “Do Not Track” rules and byto take decisive action on the antitrust front against Google.

Judge Susan Illston approved the Federal Trade Commission’s $22.5 million settlement with the Internet giant for hacking past privacy settings on Apple’s Safari browser in U.S. District Court in San Francisco, in a deal that Consumer Watchdog had argued was insufficient in light of Google’s wanton privacy violations.

“The Court also grants additional deference where the decree has been negotiated by a governmental agency that is an expert in its field,” Judge Illston said in her decision.

I was disappointed with the ruling, but think we made important points that will affect how similar cases are dealt with in the future. Drawing the public’s attention to this case was tremendously important. I’m glad we did it.

Attorney Gary Reback of Carr & Ferrell represented us as an amicus curiae or friend of the court. Frankly, I expected an uphill battle with Google and the FTC aligned against us. Together the government and Google defended the deal that had been negotiated in secret.

Judge Illston did not surprise when she began the hearing by saying her “preliminary view” was to approve the settlement. We opposed the deal for three basic reasons:

1. The settlement allows Google to deny that it did anything wrong.

2. The $22.5 million fine — a lot for you and me — is insufficient for a company like Google with revenue of $40 billion a year. Really it’s just chump change. Google makes $22.5 million in about five hours. Google was liable for fines totaling $16,0000 per day per violation. If you consider each wrongly placed cookie a violation — and you should — Google quickly reaches a liability in the billions. A fine of that magnitude would have caught Google executives’ attention.

3. The injunctive relief in the settlement is insufficient. Google is allowed to keep the ill-gotten data it obtained by hacking around the Safari privacy settings, which is the browser used on iPhones and iPads.

Reback made the arguments in two excellent briefs before the hearing. Both are well worth reviewing. The first is particularly valuable for the way it lays out Google’s history of privacy invasions. Read the original amicus brief here and our response brief here.

As the hearing began Judge Illston said there was no need to require Google to admit it did anything wrong. She said she had no problem with the amount of the fine. She did, however, have questions questions about allowing the Internet giant to retain the wrongfully acquired data.

The government and Google’s attorneys tried to make the case that the Google wouldn’t use the information, so keeping it was irrelevant. I thought Reback effectively rebutted their position, but then, you’d expect me to think that.

By the end of the day, though, Judge Illston had ruled against us. As Reback told The Associated Press’ Mike Liedtke, after the hearing, a consent decree ‘‘is not a good way to police Google,”

What the decision does is allow Google executives to buy their way out of trouble with what for them is pocket change and then deny doing anything wrong. As our briefs made clear, Google has demonstrated an ability to out maneuver government regulators repeatedly and ride roughshod over the privacy rights of consumers. Google continues to be disingenuous about its practices.

That’s why the decision makes two things clear: First, if consumers are to have any privacy at all and be able to control what data is gathered about them, tough Do Not Track rules must be implemented. Second, as we told the FTC last week, the Commission needs to file an antitrust suit against Google and take it to trial in U.S. District Court. The FTC should seek to force Google to divest its Motorola Mobility subsidiary, separate search from advertising, and undergo the same sort of regulation as a public utility.

The Federal Trade Commission’s role in keeping Google’s abuses in check is essential. The Internet is too important to allow an unregulated monopolist to dominate it.

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Google Gets Antitrust Ultimatum From FTC

12:54 pm in Uncategorized by Consumer Watchdog

FTC

Federal Trade Commission Chairman Jon Leibowitz has given Google what Bloomberg News Service describes as an ultimatum to settle the agency’s antitrust investigation in the next few days or face a lawsuit.

Citing unidentified sources, Bloomberg reporter Sara Forden on Monday wrote:

Google has been in discussions with the agency for about two weeks and hasn’t put any remedy proposals on the table, said the people, who declined to be identified because the negotiations are private.

FTC staff have been investigating whether the Google has been abusing its dominance of the Internet for more than a year. The staff has reportedly recommended issuing a complaint focused on Google’s search practices and also for misusing its patents to block rivals’ smartphones.

The FTC has told Google it won’t accept a resolution short of a consent decree, Bloomberg’s Forden wrote, and is prepared to take action in the next week or two.

Google is continuing its usual happy-face spin. “We continue to work cooperatively with the Federal Trade Commission and are happy to answer any questions they may have,” Google Spokesman Adam Kovacevich told Bloomberg.

At first blush the idea that the FTC is holding out for a consent decree may sound reassuring. For what it’s worth though, I’m a little concerned that a settlement might not do enough.

Chairman Leibowitz is expected to step down from the agency soon. There is speculation that in a nod toward his legacy, he might be willing to agree to a less than adequate settlement, just to be able to say the FTC got the Internet giant on his watch.

Frankly, there is a similar concern among privacy advocates that there could be a willingness to accept a weak Do Not Track standard for the same reason.

If the Commission files a lawsuit, the FTC could proceed in its own administrative court or in federal court. No decision has been made about the venue.

Meanwhile there was a development over the summer that might give Google pause. The Commission has changed its policy and can now seek “disgorgement” — forcing a firm to surrender profits as an antitrust penalty. If the FTC goes that route, it might really concentrate the minds of the geeks in Mountain View.

And don’t forget the other side of the Atlantic. The EU is pressing Google to resolve its antitrust concerns or face a formal complaint. That, too, could come in a matter of weeks.
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