WSJ: FTC Staff Recommended Lawsuit Against Google

(RTTNews) - A confidential report from the Federal Trade Commission revealed that officials of the agency's bureau of competition had recommended that Google Inc. (GOOG, GOOGL) should be sued for anticompetitive practices, the Wall Street Journal reported on Thursday.

According to the FTC staff report, key officials at the agency concluded in 2012 that Google used anticompetitive tactics and abused its monopoly power in ways that harmed Internet users and rivals. The report concluded that "Google's conduct resulted and will result in real harm to consumers and to innovation in the online search and advertising markets."

According to the WSJ, the report by FTC's key staff had recommended that the agency bring a lawsuit challenging three Google practices. However, the FTC's commissioners voted unanimously in early 2013 to end the investigation after Google agreed to some voluntary changes to its business practices.

Staff recommendations are supposed to remain private, but were mistakenly released to the Wall Street Journal as part of a Freedom of Information request.

The confidential report now reveals the deep division within the FTC over whether to sue Google and also poses questions about the way the agency handled the antitrust investigation into Google.

According to the staff report, Google illegally took content from rival websites such as Yelp Inc. (YELP), TripAdvisor Inc. (TRIP) and Amazon.com Inc. (AMZN) to improve its own websites. But when competitors asked Google to stop taking their content, the company threatened to remove them from its search engine.

Further, the staff report noted that Google violated antitrust law by placing restrictions on websites that publish its search results from also working with rivals such as Microsoft Corp's (MSFT) Bing and Yahoo Inc. (YHOO).

Google is also in the midst of a four-year antitrust probe by the European Commission into alleged abuse of its dominant position in the Internet search and advertising business, triggered by complaints from Microsoft, Expedia Inc. (EXPE) and others.

Google has been accused of favoring its own products and services over those of competitors in search results. As part of a proposed settlement reached with European regulators in February 2014, Google agreed to change how it displays search results to show more content from rival companies.

GOOG closed Thursday's regular trading at $557.99, down $1.51 or 0.27 percent on a volume of 1.19 million shares. In after-hours, the stock further declined $0.19 or 0.03 percent to $557.80.