FTC Caved to Corporate Pressure From Google – Released Documents Reveal Cover-Up

By J.D. Heyes

Years ago, when Larry Page and Sergey Brin launched a little search engine they called “Google,” no doubt they were thinking big. But surely they could not have envisioned that someday, their company would grow to be so rich and powerful that it had the ability to influence the outcome of criminal investigations by agencies of the federal government.

And yet, that’s exactly what happened recently, when the company’s executives managed to successfully intervene in an investigation of Google’s business practices by the Federal Trade Commission (FTC).

As reported by Reuters, three of the commission’s five members said recently that they regretted what they described as an accidental release of a portion of an FTC report regarding the agency’s most recent probe of Google, even as the media giant faces antitrust litigation with authorities in Europe.

The released document, which was the focus of a probe, noted that key members of the FTC staff wanted to sue Google over allegations that the company violated antitrust laws in its search and advertising practices.

Perfect timing?

Instead, however, the FTC settled with Google in early 2013, with the company agreeing to reimburse consumers at least $19 million (Google took in more than $45 billion in revenue in 2014).

In a statement the three commissioners – Chairwoman Edith Ramirez, Julie Brill and Maureen Ohlhausen – defended the decision not to sue.

“Contrary to recent press reports, the commission’s decision on the search allegations was in accord with the recommendations of the FTC’s Bureau of Competition, Bureau of Economics, and Office of General Counsel,” they said.

The FTC said it had not intended for the documents to be released because they were confidential and therefore should not have been included in a Freedom of Information Act request.

“We are taking additional steps to ensure that such a disclosure does not occur in the future,” the commissioners said.

The release of the documents came as antitrust regulators in Europe move forward in their four-year investigation of Google’s business practices.

The decision not to sue has been called into question primarily because of the company’s access to the Obama administration. In a separate report, The Wall Street Journal noted that, as the FTC was finishing its investigation, Google executives “had a flurry of meetings” – averaging one per week – with the White House.

The paper noted:

Google co-founder Larry Page met with FTC officials to discuss settlement talks, according to visitor logs and emails reviewed by The Wall Street Journal. Google Chairman Eric Schmidt met with Pete Rouse, a senior adviser to President Barack Obama, in the White House.

The documents don’t show exactly what was discussed in late 2012. Soon afterward, the FTC closed its investigation after Google agreed to make voluntary changes to its business practices.

No big deal

The access to high-level White House officials came at a particularly critical time in the FTC’s investigation, and is just the latest sign in how influential the California-based Internet giant has become. Since Obama took office, the paper said, Google employees have been to the White House to meet with senior government officials some 230 times, or about once per week, according to visitor logs.

Google shrugged it off as just business.

“We think it is important to have a strong voice in the debate and help policy makers understand our business and the work we do to keep the Internet open, to build great products, and to fuel economic growth,” Google spokeswoman Niki Christoff told WSJ.

So did the White House.

“White House officials meet with business executives on a range of issues on a regular basis,” said spokeswoman Jennifer Friedman. These meetings help keep the White House apprised of outside perspectives on important policy issues. Our staff is cognizant that it is inappropriate to discuss issues relating to regulatory enforcement.”

Sources:

https://www.ftc.gov

http://www.wsj.com

www.ftc.gov