JEFFERSON CITY — Missouri's attorney general has become the first state law officer to demand Google reveal information over whether its business practices violated consumer protection and anti-trust laws.
Attorney General Josh Hawley, in a statement made after he issued the investigative subpeona Nov. 13, claimed there is "strong reason to believe that Google has not been acting with the best interest of Missourians in mind."
The demand for information is being made under the Missouri Merchandising Practices Act and the state's antitrust laws. The action is against Alphabet Inc., Google's parent company.
“My office will not stand by and let private consumer information be jeopardized by industry giants, especially to pad their profits,” Hawley said in the release.
In an email to the Kansas City Star, Google spokesman Patrick Lenihan said Google has “strong privacy protections in place for our users and continue to operate in a highly competitive and dynamic environment.”
“When a company has access to as much consumer information as Google does, it’s my duty to ensure they are using it appropriately,” Hawley said in the release. “I will not let Missouri consumers and businesses be exploited by industry giants.”
Hawley is demanding details of "Google’s collection, use and disclosure of information about Google users and their online activities; Google's alleged misappropriation of online content from the websites of its competitors; and Google's alleged manipulation of search results to preference websites owned by Google and to demote websites that compete with Google," according to the release.
Several news outlets, including Bloomberg, noted that Hawley has received campaign contributions from a longtime critic of Google, Silicon Valley venture capitalist Peter Thiel, who has described the company as a monopoly. Thiel contributed $300,000 to Hawley's campaign for attorney general in 2015 and 2016.
Hawley, a Republican, has also announced he is running next year for the U.S. Senate seat currently held by Democrat Claire McCaskill. This move may be broadly popular with the electorate, including conservatives increasingly wary of the actions of Silicon Valley companies.
This could be a legitimate inquiry given the concerns over Google's market dominance, Tim Greaney, an expert in anti-trust law and formerly a professor with St. Louis University, told the St. Louis Record.
"State attorney generals are becoming active on important consumer issues, and those active on anti-trust have taken important cases," said Greaney, now a visiting professor at the University of California, Hastings, College of Law. "Missouri has not had a very active anti-trust shape in the past."
But, Greaney added, it will be interesting to see how this action plays out, and whether this is a genuine attempt to protect consumers in the state or a move to increase Hawley's popularity.
Google has made significant investments in Missouri, particularly in Kansas City, the first city where it launched its internet-provider services in 2012. More recently, however, it announced the fiber network will not reach thousands of people in some parts of the city where it was originally promised.
The Federal Trade Commission (FTC) investigated Google a number of years over allegations broadly similar to the ones in Hawley's subpoena. It decided against launching an anti-trust lawsuit. The company made minor changes to its practices, particularly in connection with scraping and taking information from other sites such as Yelp.
While Hawley's action is the first of its type against the company, and one that could prompt other states to join, Mississippi's Attorney General Jim Hood has sued Google twice, including for violating the privacy of students by tracking them through its G Suite for Education. That case is ongoing.
Bloomberg also recently reported that Hood has written to the FTC after Yelp complained to the agency that Google is violating promises it made as part of the 2012 agreement to avoid a federal lawsuit, that included not taking information for use on its own sites.
In announcing his action, in the release issued by his office, Hawley cited a recent $2.7 billion fine levied against Google by the European Union. Google is appealing that June decision by the EU's general court.
The court ruled that Google manipulated search results to promote its own price comparison shopping service that led to sharp increases in traffic.
“What Google has done is illegal under EU antitrust rules,” Commissioner Margrethe Vestager said when the decision was handed down. “It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.”
After his announcement, Hawley told reporters, "We’re concerned they’re engaged in a similar pattern of behavior in the United States."
Hawley also noted in the release that the Electronic Privacy Information Center, a Washington, D.C. privacy rights organization, filed a complaint with the FTC regarding a Google program that tracks consumer behavior.
That complaint claims that Google's new Store Sales Measurement will allow the company to gain access to the purchase records of almost all American consumers, and is doing so without revealing how it got the information or giving consumers a way to opt out.