ALEXANDRIA, Va. (CN) — A Yale professor Wednesday challenged the accuracy of an analysis undergirding the U.S. Department of Justice case charging Google with antitrust violations and monopolistic conduct in the ad market.
In testimony on the 13th day of the trial, Judith A. Chevalier, the William S. Beinecke professor of finance and economics at the Yale School of Management, forcefully criticized previous testimony that Google’s anticompetitive conduct results in overcharging customers in the company’s advertising exchange.
That analysis, by Timothy Simcoe of Boston University Questrom School of Business, involved the impact of Google’s hold on the market. In testimony last week, he described work evaluating the Google Ad Exchange, a digital marketplace for purchasing and selling digital ads. In the course of his testimony, he described how he had contrasted rates and determined that the exchange charges 19 to 26% more than it would in a competitive market.
The testimony is invalid, Chevalier said, adding, “The analysis is sensitive to tweaks that lead to different results.” She also asserted that the review never connected its conclusions with Google’s purported conduct.
Chevalier was called to testify by attorneys for Google, who are presenting their defense of antitrust charges focused on the tech behemoth’s dominance in the web advertisement market. The trial, at the U.S. District Court for the Eastern District of Virginia, follows an investigation by the Justice Department, which contends that Google operates as a monopoly. The department’s 150-page complaint accuses the Silicon Valley tech firm of engaging in a systematic campaign to seize control of high-tech tools used by publishers, advertisers and brokers to facilitate digital advertising.
In one part of the complaint, Justice Department attorneys focus on unified pricing rules in which publishers no longer use price floors to choose rival exchanges over AdX. “Google effectively took away their own customers’ right to choose what buyer or ad exchange best suited their needs,” the department said in the complaint. “In doing so, Google once again bought itself a free pass on competition.”
But Google’s attorneys Wednesday entered a deposition by Ken Blom, chief business officer at BuzzFeed Inc., who said that the organization uses AdX along with multiple other ad exchanges.
The tech giant’s legal team, led by Karen Dunn, a partner at the firm Paul Weiss, is expected to finish presenting their case Thursday. U.S. District Judge Leonie M. Brinkema said she would allow attorneys to file final briefs. A decision will probably not be forthcoming until December.
Justice Department attorneys have asked the court to order the divestiture of Google’s Ad Manager suite — including both Google’s publisher ad server and Google’s ad exchange — and to enjoin the firm from continuing to engage in what it calls anticompetitive practices.
This trial isn’t Google’s first inning with antitrust litigation. In August, a U.S. District Court judge in Washington, D.C., found the company violated antitrust law with its search business. Separately, a New York federal judge advanced an Atlanta ad firm’s antitrust claims against Google over its abrupt transition away from Adobe Flash-supported video advertisements in the mid-2010s.