Executives personally signed off on Facebook-Google ad collusion plot, states claim

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Facebook's Mark Zuckerberg and Google's Sundar Pichai personally approved a deal that would see the social media giant gain an advantage in the search engine's ad auctions, according to a group of state attorneys general.

The 2018 arrangement potentially gave Facebook illegal advantages, the attorneys general from 15 states and Puerto Rico, led by Texas's Ken Paxton (R), allege in court filings unsealed Friday.

The coalition initially filed its antitrust lawsuit alleging that Google holds a monopoly over the advertising technology market in 2020, then filed an updated complaint in November. The document released Friday is a less redacted version of the newer complaint.

It includes internal emails showing that the deal to limit header bidding practices, named Jedi Blue, was negotiated by top officials, including Zuckerberg and Facebook COO Sheryl Sandberg. The existence of the deal had already been revealed in a previous iteration of the case.

A Google spokesperson defended the agreement in a statement to The Hill on Friday while denying that Pichai personally greenlighted it.

"We sign hundreds of agreements every year that don't require CEO approval, and this was no different," Peter Schottenfels of Google said. "And contrary to AG Paxton's claims, the fact of this agreement was never a secret - it was well-publicized."

A spokesperson for Meta, the newly formed parent company of Facebook, also defended the agreement.

"These business relationships enable Meta to deliver more value to advertisers while fairly compensating publishers, resulting in better outcomes for all," they said.

Meta is not named as a defendant in the suit.

The complaint also contains allegations that Google misled ad publishers and buyers, creating secret programs that resulted in price differentials that the company pocketed.

The state attorneys general cite internal Google correspondences in which employees described the practices as benefiting the company with "insider information."

Schottenfels also denied the allegation that the company had manipulated ad auctions.

"Despite Attorney General Paxton's three attempts to re-write his complaint, it is still full of inaccuracies and lacks legal merit," he added, referring to Texas Attorney General Ken Paxton (R).

The Paxton-led antitrust lawsuit is one of two major cases levied against Google.

The other case, filed by the Justice Department and a separate coalition of state attorneys general, focuses on the company's dominance in the online search space.

Updated at 5:08 p.m.