Google faces €25bn legal action in UK and the EU

Google is facing two legal cases which could result in the tech giant paying out damages of up to €25bn (£19.5bn) over its digital advertising practices.

The company is accused of anti-competitive conduct, and of abusing its dominant place in the ad tech market.

Separate legal cases, in the UK and in the Netherlands, are being filed in the coming weeks on behalf of publishers seeking “compensation” from Google.

Google has recently drawn scrutiny from anti-trust regulators after complaints.

Ad tech powers the online adverts that people see on their smartphones or when using the web. Google is the largest, and most important, ad tech vendor – with a market share reaching over 90%.

Selling digital advertising space has become a valuable source of income for publishers including global news websites, as well as smaller operators, such as independent bloggers – all of whom agree to carry advertising on their sites for a fee,

The European Commission and its UK equivalent are investigating whether Google’s dominance in the ad tech business gives it an unfair advantage over rivals and advertisers.

The French competition watchdog imposed a €220m fine on the company last year.

Johnny Ryan, from the Irish Council for Civil Liberties, told the BBC: “Google is under pressure on two big issues – one is anti-trust and the other is data protection.”

Mr Ryan said more cases were coming to light as competition enforcers around the world “increasingly put demands on Google”.

But he added “the fines we have seen so far from competition authorities have had absolutely no consequence whatsoever”.

Damien Geradin, of the Belgian law firm Geradin Partners – which is involved in the Dutch case – said, “Publishers, including local and national news media, who play a vital role in our society, have long been harmed by Google’s anti-competitive conduct.

“It is time that Google owns up to its responsibilities and pays back the damages it has caused to this important industry.

“That is why today we are announcing these actions across two jurisdictions to obtain compensation for EU and UK publishers.”

The British claim, at the UK Competition Appeal Tribunal, will seek to recover compensation for all owners of websites carrying banner advertising.

If successful, this would mean a wide and diverse group could get compensation – from major media sites down to small and medium-sized businesses who produce their own online content.

Businesses which do not which to be included in the legal action can opt out.

UK law firm Humphries Kerstetter is planning to bring its case to the Tribunal next month, although the process could take years to reach a conclusion.

Toby Starr, of Humphries Kerstetter, told the BBC, it was important to bring the claim because of the reasonable expectation that the tech giant might change practices as a result.

He said the claim represented “victims of Google’s anti-competitive conduct in ad tech who have collectively lost an estimated £7 billion”.

“This includes news websites up and down the country with large daily readerships, as well as the thousands of small business-owners who depend on advertising revenue – be it from their fishing website, food blog, football fanzine or other online content [which] they have spent time creating and publishing.”

The UK competition watchdog is also investigating Google’s power in the digital advertising technology market.

The Dutch case is open to European publishers affected by Google’s actions. Geradin Partners has teamed up with Dutch law firm Stek to bring the collective claim.

Jan Bart van de Hel, from Stek, said: “Many publishers have suffered damages as result of Google’s wrongful actions.

“It is important to take action against this, not only to make sure that the damages of the publishers are fully compensated, but also to make sure that Google’s anti-competitive conduct is prevented for the future.”

UK litigation funder Harbour is funding both lawsuits. Harbour is a privately-owned company which pays legal costs upfrong “and helps manage the costs and risks of litigation” in return for a pre-agreed share of the amount recovered if the legal action is successful.

Google did not immediately respond to the BBC’s request for comment.