Google sought to use an August 2019 meeting with fellow tech giants Apple, Facebook and Microsoft to stall federal efforts to strengthen a children’s online privacy law, attorneys general for Texas and other states alleged in newly unsealed court documents on Friday.
Google also bragged about “slowing down” new privacy rules in Europe that would apply to digital services like services such as WhatsApp, Facebook Messenger and Microsoft’s Skype, according to internal documents quoted by the states. But the search giant expressed concerns that Microsoft, which had been making “subtle privacy attacks” on its Big Tech rivals, might not go along with its plans.
“We have been successful in slowing down and delaying the [ePrivacy Regulation] process and have been working behind the scenes hand in hand with the other companies,” the complaint quoted Google executives as saying in a memo ahead of the meeting. The August meeting could “find areas of alignment and narrow gaps in our positions and priorities on child privacy and safety.”
The complaint doesn’t detail what happened at the meeting, which the states said occurred on Aug. 6, 2019. But Apple spokesperson Fred Sainz said Friday that no representative from his company attended the meeting.
A Microsoft spokesperson declined to comment on the meeting. Facebook did not immediately offer a comment when asked Friday.
The documents — filed as part of an antitrust suit by Texas, 14 other states and Puerto Rico — are emerging at a time of rising frustration in Congress with the tech industry's privacy practices and the slow progress of the push for a federal data privacy law. A federal judge in New York ordered the document unsealed at the request of 23 news media outlets including POLITICO.
Google spokesperson Julie Tarallo McAlister said the new claims in the Texas lawsuit were “riddled with inaccuracies" but did not address the states' account of the meeting.
“We've been clear about our support for consistent privacy rules around the globe," she said. "For example, we have been calling on Congress to pass federal privacy legislation for years."
But Sen. Ed Markey (D-Mass.), a leading advocate of children's privacy legislation, said the revelations about the 2019 meeting suggest otherwise.
“Big Tech and its army of lobbyists are working hard to block Congress’ efforts to enact privacy legislation because it would cost them money," Markey said. "It’s as simple as that. Even when it comes to children, these companies put their bottom line before their users’ well-being."
A week before the meeting, the Federal Trade Commission announced that it was considering making changes to its interpretation of the Children’s Online Privacy Protection Act, which prohibits companies from collecting information about kids under the age of 13 without parental permission. Markey and Sen. Josh Hawley (R-Mo.) had also introduced legislation to amend that law to give greater protections to teens between 13 and 15.
“Whether at this meeting or at another forum, we may want to reinforce that this is an area of particular importance to have a coordinated approach,” Google said in its internal memo about children’s privacy quoted in the complaint.
“We have direction from Kent [Walker] to find alignment with MSFT where we can but should be wary of their activity [in promoting privacy] and seek to gain as much intel as possible,” the memo added. (The brackets, which appear in the version of the quote cited in the complaint, indicate that the "direction" came from Google senior vice president and chief legal officer Kent Walker.)
In the same memo, Google said it might not be able to persuade Facebook to “align on our privacy goals and strategy,” adding that the social network “prioritized winning on reputation over its business interest in legislative debates.”
Within a month of the meeting, Google agreed to pay $170 million to resolve allegations by the FTC and the New York attorney general that it had violated the COPPA by collecting information about kids who watched videos on YouTube. The fine was the biggest ever imposed for violating children’s privacy online.
Jedi Blue: The newly unsealed court filing also offers fresh details on a 2018 advertising agreement between Google and Facebook, nicknamed Jedi Blue — a deal whose disclosure last year drew new attention to the relationship between the No. 1 and No. 2 players in online advertising.
The states alleged in their first complaint, filed in December, that Google and Facebook made a secret, illegal pact in 2018 to divide up the market for ads on websites and apps. (The suit alleges that Google has monopolized the technology to buy, sell and serve online display ads.) But the December filing redacted most details about the agreement.
In the new filing on Friday, the states quoted an August 2018 presentation by Google that if it could not “‘avoid competing with FAN [Facebook Audience Network],’ then it would instead collaborate with Facebook to ‘build a moat.’”
The agreement was prompted by Facebook’s move in 2017 to use “header bidding” — a technology popular with website publishers that helped them increase the money they made from advertising. While Facebook sells ads on its own platform, it also operates a network to let advertisers offer ads on third-party apps and mobile websites.
Top Facebook executives said in emails that the Google deal was “a big deal strategically.” The social network viewed itself as having limited options: It could "'invest hundreds more engineers' and spend billions of dollars to lock up inventory to compete, exit the business, or do the deal with Google."
Under the terms of the agreement, which top executives from the companies signed in November 2018, Google gave Facebook advantages when the social network used its advertising exchange, the states said. The duo also integrated some of their software so that Google could pass Facebook data to use in helping to track and identify users.
Google and Facebook have also subverted technology that aims to block tracking on Apple devices, and on Apple’s Safari browser, the states alleged.
Facebook's response: Facebook spokesperson Christopher Sgro said the company supports “fair and transparent advertising auctions” where “the highest bidder wins.”
“Nothing disclosed today changes that fact. To the contrary, the full record confirms what we’ve said from the beginning — that Facebook’s non-exclusive bidding agreement with Google and the similar agreements we have with other bidding platforms, have helped to increase competition for ad placements,” he said. “These business relationships enable Facebook to deliver more value to advertisers while fairly compensating publishers, resulting in better outcomes for all.”