London trial puts Google shopping box under the microscope

Google says opening its shopping box to rivals ended years of self-preferencing. Kelkoo and Ciao say Google still controls the page that matters most.(CN) — Google says it opened the door. Its rivals say Google still owns the building, a divide laid bare as closing arguments wrapped up in a London antitrust trial Wednesday.Comparison-shopping companies Kelkoo and Ciao seek damages in the U.K. Competition Appeal Tribunal, a specialist court for competition disputes, claiming Google unlawfully buried rival comparison sites in search results while reserving its most valuable shopping space for itself. Google says a 2017 redesign fixed the problem and that the claimants’ proposed alternatives would require far more than competition law demands.Wednesday’s arguments turned on what, exactly, Google’s shopping box has become.In 2017, the European Commission fined Google 2.42 billion euros (about $2.76 billion) after finding it illegally steered shoppers toward Google Shopping while demoting rival comparison sites in search results. Rather than scrap the shopping box, Google redesigned it so rival comparison sites could bid for the same space alongside Google Shopping.Google lawyer Meredith Pickford said that was precisely what the commission required. The decision, he argued, condemned Google’s preferential treatment of its own comparison-shopping service, not the shopping box itself.“What we say is that the remedy box unequivocally cures the self-preferencing of Google’s standalone comparison shopping service, the abuse found in the decision, because it treats Google Shopping and rival comparison shopping services equally on the server,” Pickford said.He said rival comparison sites can now upload their own product listings, merchants can choose not to use Google Shopping, and separate auctions determine which offers appear. Those changes, he argued, turned the shopping box into a neutral marketplace rather than Google’s own comparison-shopping service.Tribunal chair Peter Roth pressed Google on whether those changes altered the service itself or simply changed how it operates.“Have these changes been so fundamental that it no longer involves the self-preferencing that existed before?” Roth asked.Kelkoo and Ciao disagreed. They argued Google still decides when the shopping box appears, where it sits on the page, how large it is and how products are displayed, leaving rival comparison sites little more than suppliers of merchant advertisements while Google keeps the customer relationship and the page’s most valuable real estate.They say Google’s 2017 remedy simply put a price on access instead of giving up meaningful control. Their proposed alternative would let comparison sites, rather than Google, compete to populate and rank the entire shopping box.Pickford said those proposals would effectively force Google to surrender premium search space or scrap the feature altogether.“Why would they want to give away their prime assets for free?” Pickford asked.Just days before closing arguments, Google picked up a new problem. Last week, the European Commission determined Google’s post-2017 shopping redesign still gives its own services preferential treatment under the European Union’s Digital Markets Act (DMA), the bloc’s law aimed at reining in the market power of the biggest online platforms. Google said that decision applies a different legal test and cannot settle this damages claim. Kelkoo and Ciao argued it can’t be ignored.“But, of course, we say it is their fault. They should stop self-preferencing,” said Daniel Jowell, representing Kelkoo and Ciao.The tribunal ordered both sides to file submissions on how the commission’s new decision affects Google’s challenged conduct and the lawful counterfactual for calculating damages. The case returns Sept. 11, when the tribunal will hear arguments on the DMA ruling before deciding whether the record needs to be reopened.Courthouse News reporter Eunseo Hong is based in the Netherlands.Subscribe to our free newslettersOur weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.Additional Reads