Tech Policy Press - Epic's Win Against Google: Reason for Optimism, But Uncertainty Remains
Senior Legal Analyst Daniel Hanley writes that Epic Games' victory over Google’s illegal monopolization is a welcome morale boost for antimonopolists, developers, and consumers alike, but the fight is far from over.
More than three years after the North Carolina developer of Fortnite, Epic Games, initiated its blockbuster antitrust lawsuit against Google, this week a jury of nine ordinary Californian citizens marked 11 Xs on a document and declared that Google engaged in illegal monopolization. This decision is stunning. Besides the fact that most antitrust lawsuits avoid juries altogether and are instead decided solely by a judge, this decision marks Google’s first loss in an antitrust action. It is now clear that even the seemingly invulnerable technology darling can be wounded – in its home state nonetheless…
Journalists have lauded this lawsuit as a major historical event with significant implications, and in some respects it is. But it’s important not to be too hopeful about the result and instead remain cautiously optimistic. To start, while Epic did obtain a favorable result – i.e., a jury found that Google violated the law – that does not automatically translate into Epic procuring a favorable remedy to its asserted harms. As in all antitrust cases, judges maintain exclusive authority to fashion remedies and have exceptionally broad discretion to construct the remedies they can apply, which are also difficult to challenge on appeal. A Supreme Court decision from the 1940s aptly details just how much leeway district judges have regarding antitrust remedies. The Court stated that district judges are “invested with large discretion to model their judgments to fit the exigencies of the particular case.” So, the case could result in a situation where Google avoids significant structural changes to the operations that led to the lawsuit from Epic in the first place. So Epic can win a battle but lose the war if the remedies crafted by Judge Donato are lackluster. The hearings for the remedies will start in late January.
Should Judge Donato impose remedies of the kind Epic requested in its complaint, Google would be confronted with significant competition. In the most favorable example, Google could be required to allow alternative application stores and payment processors on its Android operating system. Such a circumstance would have clear benefits for developers and consumers. Stores that offer substantially lower fees could exist on Android. The newly infused competitive pressure would incentivize Google to lower costs to developers and improve their application store. Competing stores could provide more choice to consumers and potentially have stricter rules regarding the kinds of applications allowed – potentially allowing users to avoid malware, a problem Android has been repeatedly plagued with.
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