Newspapers across the country have quietly filed antitrust lawsuits against Google and Facebook over the past year, alleging the two companies monopolize the digital advertising market for revenue that would otherwise go to local news.
Why it matters: What started as a small-town effort to take a stand against Big Tech has blossomed into a national movement, with more than 200 newspapers involved in dozens of states.
- “The intellectual framework for this has developed over the last 3-4 years,” said Doug Reynolds, managing partner of HD Media, a holding company that owns several West Virginia newspapers, including the Charleston Gazette- Mail.
- Reynolds, along with a group of lawyers, Class the first such trial in a newspaper in January in West Virginia.
Catch up quickly: In the first lawsuit, Reynolds worked with a coalition of attorneys who agreed to represent newspapers across the country seeking to bring similar lawsuits.
- The attorneys include antitrust litigation experts and attorneys with personal interests in the journals of Farrell and Fuller, Fitzsimmons Law Firm, Robbins Geller Rudman & Dowd LLP and Herman Jones LLP.
- The lawsuits are contingency-funded, meaning the attorneys involved only get paid if and when the newspapers win settlements.
In numbers : To date, the group has been retained by more than 30 newspaper owners’ groups (list) on behalf of more than 200 publications to sue.
- Among these, antitrust complaints have been formally filed by 17 different ownership groups representing approximately 150 newspapers.
- The News Media Alliance, a trade group that represents newspapers, was not involved in the litigation, but has been monitoring the lawsuits.
- “We fully support this litigation,” Danielle Coffey, general counsel for the News Media Alliance, said in a statement.
The purpose of the dispute is “to recover past damages to newspapers” caused by big tech companies, says Clayton Fitzsimmons, one of the lawyers representing the newspapers.
- The other is to “establish a new system in the future in which newspapers are not only competitive again, but can thrive,” he said, referring to laws like Australiathat force tech companies to pay publishers for their content.
Between the lines : “Past damage” in lawsuits like these will vary by paper.
- If the lawsuits are successful, the documents could be entitled to “triple damages,” settlements that are three times the actual damages found to have occurred, said Paul Farrell Jr., a West Virginia attorney. who has successfully taken on some of the nation’s largest pharmaceutical companies in opioid lawsuits in 2018.
- Farrell was inspired to work on Reynolds’ first case in West Virginia, in part because of the Pulitzer Prize-winning journalism of the opioid crisis carried out by his hometown newspaper, the Charleston Gazette-Mail.
Overview : The lawsuits were filed after the House Judiciary Committee released its digital competition report last October, which included a section on newspapers.
- Legislators have expressed a keen interest to understand how the dominance of Google and Facebook affects the newspaper industry.
- The Department of Justice, along with several state attorneys general, sued Google for violating antitrust laws. Facebook faces similar antitrust trial state attorneys general and the Federal Trade Commission.
What to watch: All of the lawsuits were consolidated by a court panel over the summer in the Southern District of New York.
- The News Media Alliance filed a declaration to consolidate the cases earlier this year, in the hope that the attorney general there would be more sympathetic to prosecutions by newspapers.
- The lawsuits were able to be consolidated in New York due to a similar lawsuit that was Class by Associated Newspapers, parent of the Daily Mail, against Google in New York in April.
Next steps : There are different ways for the court to handle these lawsuits, Fitzsimmons says. They could select a few as grooms, test cases for all individual claims, or could send some cases back to the states where they were filed for trial.
- For now, the consolidated cases are still pending.
- Facebook has not commented. Google said: “These claims are simply untrue. The online ad space is crowded and competitive, our ad technology fees are below reported industry averages, and publishers retain the the vast majority of income gained when using our products. We are one of the countries in the world main financial supporters of journalism and have provided billions of dollars to support quality journalism in the digital age.
Go further: Complete list of newspaper groups and newspapers who have filed complaints and/or retained legal services to file an antitrust complaint in the near future.
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More than 200 newspapers are now embroiled in quiet lawsuits against Google, Facebook