Transcript of Conference Call on U.S. v. Google Remedies with Professor John Newman

On September 3, The Capitol Forum held a conference call with Professor John Newman to discuss the remedies opinion in U.S. v. Google and its implications for antitrust enforcement. The full transcript, which has been modified slightly for accuracy, can be found below.

TEDDY DOWNEY: Good afternoon, everyone. And welcome to our Conference Call on U.S. v. Google with Professor John Newman. I’m Teddy Downey, Executive Editor here at The Capitol Forum.

And John doesn’t need much introduction but I’ll give him a quick one. He’s a leading expert on antitrust and competition law with a focus on economics and regulation of digital markets, served as Deputy Director of the Bureau of Competition at the FTC and as a trial attorney in the U.S. Department of Justice Antitrust Division. We’ll be talking about the opinion that came out yesterday.

And also joined by the great Nate Soderstrom, who thankfully is back at The Capitol Forum and leading our 1aAntitrust Team.

And so, thank you both for doing this.

JOHN NEWMAN: Yeah, thanks for having me.

TEDDY DOWNEY: And Nate and I will switch off questions. But just to get started, I want a very open-ended question here. What are just general thoughts on the opinion, highlights, lowlights? And then we’ll go from there.

JOHN NEWMAN: Okay. So, yeah, general reactions. I mean, it’s a monster, right? It’s over 200 pages. We’ve got another antitrust blockbuster on our hands. It’s complicated. If anybody says you can sum this up and like here’s your one takeaway, I would say no. There’s a couple of different aspects of this that I think jump out to me.

In some respects—and this is the closest I would get to an overall headline—in some respects, it is narrower than I expected. I did not expect it to be everything that DOJ was asking for, of course. So, I was already kind of managing my expectations. But even so I would say in some ways this is narrower than I expected and I suspect that’s somewhat widely shared.

So, it’s a little bit conservative. It’s a little bit cautious in some ways. Just as an example, it doesn’t really even prohibit all of the illegal conduct, which is usually viewed as a bare minimum for an order like this one.

At the same time though, there is at least one area where it is a little bit aggressive and that’s on the Gen AI front. I think there was room for Judge Mehta to go much narrower than he did and he went broad there.

So, then if we can step back a little bit, kind of marrying those two things together, I’d say this opinion, this decision, is a little bit of a gamble, I would say. I think Judge Mehta is gambling on, “hey, I can do a little less on the traditional search front, as long as I do a little more on the Gen AI front, and I hope that dynamic competition will kind of solve the problem for us.”

NATE SODERSTROM: Yeah, that certainly makes sense. John, Mehta kind of framed the opinion as effectively an exercise in judicial humility. Remedies require the court to gaze into a crystal ball. That’s a very challenging thing to do. Courts aren’t necessarily equipped to do that type of thing. Therefore, he’s going to err on the side of a more conservative approach. Do you think it’s actually correct to describe this opinion as an exercise in judicial humility?

JOHN NEWMAN: Well, this is one of those times I’m happy I’m a professor now and I can just sound off. I’m not appearing in front of this judge anytime soon. Let’s start off by pointing out, if you have to start your own opinion by essentially saying, “I am so humble. I am the most humble, in fact.” A little bit of a yellow flag, at least a beige flag, as the kids are saying these days. So, I’m always a little suspicious when a judge starts out saying, “I am really humble.:

That’s just kind of a cheap shot, I’ll admit — more onto the substance. No, just to put it bluntly, I do not read this as an exercise of judicial humility for two reasons. One, on the one hand, this opinion, at times admittedly—and I’m going to say that again—at times expressly and admittedly — just deviates from what the Supreme Court has said the judge has to do. There’s a point in the opinion, even the immediate appellate court has told this judge, you have to do certain things here with this remedy. And the judge admits, yeah, I’m just not going to do that because I don’t think it’s a good idea.

So, getting a little more specific, the Supreme Court has said, and this D.C. Circuit has said, you’ve got to do four things here. And Judge Mehta kind of said—not even kind of, just said—yeah, I’m not going to do all four things; I just don’t think that’s right. Well, that is not humility. That is, “I know better than the Supreme Court and the D.C. Circuit in an en banc decision” Doesn’t sound humble to me.

Two, and this gets back to Teddy’s first question, this opinion, I think at a meta level – ha ha—it is a kind of a gamble on gen AI competition working to solve the Google monopoly problem. Gambling like that depends on your confidence, and some might say overconfidence, in your ability to predict the future in what everybody agrees, I think, is a potentially rapidly changing dynamic technological landscape. So, “I’m a super humble, super cautious judge, I’m not going to gamble the American public on my ability to predict the future.”

TEDDY DOWNEY: So, one thing that stood out to me, and that’s gotten a lot of attention and that I think surprised a lot of people and is very confusing, is the ban on exclusive contracts relating to Google Search, but no ban on payments for preloading or placement of Google Search. Exclusive deals are not okay, but defaults are okay. Even though Meta in the liability phase said those are basically the same thing. It seems incoherent and hard to parse.

What is the practical outcome of all of this? It seems like Google and Apple can basically just keep on doing what they were doing, which he said was illegal. I think that’s just absurd on one level, but if you read the opinion, he goes even further to basically say we shouldn’t punish Google from potentially being successful or Apple from potentially being successful. We shouldn’t take away Apple’s ability to take that money and use it to make the iPhone better. Stuff that he actually seemed to expressly say was not what he was going to do at the liability phase.

So, I’m curious to get your thoughts generally. And also, just peeking ahead, if there is an appeal here, is this type of thing really going to survive an appeal?

JOHN NEWMAN: Good questions. Big questions. There’s a lot going on here. So, as to the practical effects of this thing, you’re exactly right. Depending on how you want to assign weight to different aspects of the illegal conduct, you may differ on this, but what I think is beyond argument is there are six aspects of illegal conduct in that liability opinion. This remedy order, I think, only prohibits three of them.

So, maybe Mehta’s right, those are like the most important three. So, it’s actually more than half. But just by strictly counting, he’s letting Google do half the stuff that he said was illegal not that long ago. That’s wild. To the extent there’s something surprising in the opinion, I think that’s it. I think everybody thought, at least he’s going to do the minimum here.

So, yeah, you’re absolutely right. Google and Apple’s relationship, at least on my reading, continues virtually unchanged. There’s maybe a few little things in the contract that Google can’t put in, but it’s candidly not the stuff Google really cares about. As Mehta pointed out, Google already changed some of this stuff. Well, that kind of means they don’t really care about it that much.

So, Judge Mehta’s explanation is, if we stopped this arrangement altogether, it would have crippling effects on all these search distributors. I mean, at least as to Apple, I was like, come on. No way. It would be a bummer for Apple if they lost out on this illegal stream of income. But how do you not ban that?

So, yeah, I think that’s exactly right. It is shocking to me. I think it’s really problematic. Will it survive on appeal? Honestly, probably. On appeal, I think judges are, in general, less inclined to order stronger remedies than a trial court judge who’s just closer to the facts. In general, the D.C. Circuit’s kind of lower-C conservative. I don’t really see them saying, yeah, this didn’t go far enough.

I would try it if I were DOJ, candidly. I’d try to appeal and say, you have to, at a bare minimum, stop the illegal conduct. But man, it’s hard to see this one getting overturned. So, I think we are living still in Google’s world.

NATE SODERSTROM: We may, John, get back to appeal in a moment. But on this question of Gen-AI, Mehta wrote very early on in the decision, the emergence of Gen-AI changed the course of this case. And many of DOJ’s proposed remedies, and especially the farthest-reaching remedy proposals, were geared toward preventing Google from carrying search dominance over to Gen-AI.

But Mehta seemed to feel that it kind of cut the other way, that the emergence of Gen-AI counseled toward a more limited set of remedies, a more conservative set of remedies. How compelling was his reasoning there? And I guess maybe put differently from your perspective, hurt emergence of Gen-AI? Anyway, Gen-AI has emerged. Nobody disputes that. Could that dynamic have changed the course of this case? And in particular, could it have changed his approach to remedies there?

JOHN NEWMAN: Yeah. So, maybe, I guess, three questions. First one is just, what’s going on here with his reasoning? Here’s the way I read that. It is kind of a puzzling passage. And then we get a much longer, extended discussion of Gen-AI later on in the opinion about halfway through. It did change his reasoning, and this maybe gets to your third question, too. Should it have changed his reasoning?

Here’s how I think it did. The emergence of Gen-AI is kind of a focal point during the remedy stage, which is true. Both sides were talking a lot about it. It prompted him, I think, to simultaneously weaken, but also strengthen what he would have otherwise, done. So, I think in a world where he can’t gamble on Gen-AI fixing all the problems, I think he probably does go further to prohibit some of the pay-for-play agreements, like Teddy and I were just talking about a second ago. It’s wild that illegal conduct is allowed to continue.

Here’s how I think he justifies that. He does more than he needed to on the Gen-AI front, including syndication of search results, and he’s pretty clearly envisioning — he’s making it possible — if you are a new startup that’s doing something pretty radically different than just plain 10 blue links, you’ve got the tools you need to start that, and then you can build from there.

So, that’s kind of how I read this. Gen-AI played a big role, but it didn’t make his remedies weaker or stronger. It made them both weaker and stronger. As to whether that’s a good way to go about judging, man, I mean, he says at one point, we’re not like venture capitalists. If we could predict the future, we’d all go be on Wall Street or Vegas instead of the federal bench. Like, yeah, buddy, that’s probably right. I don’t think you can predict the future with that level of precision. We’ll see, but it really is a gamble.

TEDDY DOWNEY: One thing that came up a lot was the Microsoft decision. Mehta seemed to think that the law tied his hands on certain remedies, especially when it came to structural remedies. You see a lot of reference to Hovenkamp throughout. Do you think he was right on the law when he was kind of tying his own hands on structural remedies?

JOHN NEWMAN: Depending on how you want to read it, there is a portion of the big Microsoft opinion that loomed super large over this entire case that is not favorable to structural remedies. Now, I think you can read that as kind of advisory dicta. It’s not really part of the core holding in that case. It’s more just instructions to the trial court on remand about how to think on that particular set of facts. But me personally, whenever somebody says, oh, that’s just dicta, I’m kind of the view that, well, if a federal judge said it’s still got some force behind it.

So, I’m sympathetic. I’m not sure if he was actually inclined to do a structural remedy and felt constrained. Either way, I’m sympathetic to the view that, yeah, in the D.C. Circuit, there is some unhelpful precedent on structural remedies. Candidly, I don’t think I would have chosen to bring that case in the D.C. Circuit if I knew I was going to go hard after structural relief for that very reason. It’s like the worst circuit on structural remedies.

Herb is a close friend, a mentor. We agree on a lot. We disagree on some things. I think appetite for structural remedies is one of them. Herb’s pretty open about being almost totally opposed to structural remedies, unless you’re dealing with a merger type case, which this was not. To me, I’m a little more inclined to say that structural remedies – although, they are not a magic bullet, they’re not always going to fix everything, of course—they require you to be less of a gambler. They’re more complete. They’re more sure. They’re more certain. To me, divesting Chrome, though not easy, I think would have been essential to a confident, “yeah, this remedy’s going to work” outcome.

NATE SODERSTROM: Yeah. John, I know you mentioned the prospect of an appeal from DOJ on remedies. Google, of course, is appealing liability. To the extent DOJ were to appeal, or I suppose this would perhaps be a cross appeal, on the remedy question, I guess, (1) where do you see the openings here? Where’s the vulnerabilities? Where are the vulnerabilities in the district court decision? (2) How do you think about likelihood of success? Again, with the understanding, as you just alluded to, an appeal would be for the D.C. Circuit, which may not be where you want to be when it comes to the remedy question, especially to the extent they’re focusing on structural fixes.

JOHN NEWMAN: Yeah. So, thinking about this from DOJ’s perspective, because I think of the two, DOJ probably feels more like they just took a bit of a loss, right? I mean, look, if you win a Section 2 case in the 21st century, that is not easy. Let’s not downplay that. And they did get more by way of remedy than a pessimist might have thought, right? So, you did get some stuff out of all that blood, sweat, and tears. That said, again, I think DOJ probably feels a little bit of a sting. Whereas Google, I suspect, is mostly in a celebratory mood today.

Okay, so from DOJ’s perspective then, if we’re right, and they’re the more likely to start an appeal, it’s not super obvious how to frame that. I think you probably have to start with the statement in Microsoft that says, according to the U.S. Supreme Court, remedies must seek to do one, two, three, and four.

And then you hold up the parts of Judge Mehta’s opinion where he says, I’m just not going to do some of those things. Okay, there’s your error of law. It’s not a fact-driven issue. He explicitly said he’s doing it. You don’t have to read between the lines. He came out and said, I’m going to deviate from established precedent.

You have to hope you’re going to get an appellate panel, I think, if you’re going to make that argument, that is actually going to feel bound by the Supreme Court, even if the case is older than, let’s say, 1980. And that’s not a sure thing, right? Antitrust is kind of weird that way. But I think the Chicago School was pretty successful at convincing a lot of judges that history starts in 1973.

NATE SODERSTROM: Yeah, it’s the way Supreme Court decisions and antitrust work is anything before 1973 or whatever, lower courts are permitted to disregard, is my understanding of how it works in antitrust.

JOHN NEWMAN: Yeah, that’s right. And there’s no contrary direction from the Supreme Court. But the vibes, the vibes have shifted. There has been a pronounced vibe shift. And in antitrust, if nowhere else, we love vibes. So, you’re going to hope that you’ve got a court that is not going to just go on vibes here and is actually going to say, “yep, the Supreme Court said you have to do this, go back to the drawing board.”

You asked about probability of success on that type of theory. Candidly, not high, I don’t think. I think you could hope for the panel to clear up some of the more weird statements like on causation, which we could talk about, on the express deviation from the guidance, that sort of thing.

It’s going to be tough to win in part because this isn’t just totally defendant-friendly. If that’s what Judge Mehta had done, I think it would be maybe more likely you could get a win on appeal. But given that he did this kind of, “hey, I’m going to give a little here, I’m going to take a little there. We’re going to go weak on prohibiting the conduct itself. We’re going to go strong on Gen-AI.” That kind of split the baby, if you want to call it that, or “I’m giving each side a little, even if nobody’s totally happy.” Those kind of decisions, usually they fare pretty well on appeal. It’s just hard to get those overturned.

TEDDY DOWNEY: Nate, do you have any follow-up to that?

NATE SODERSTROM: Well, John, should we chat on causation briefly just because you flagged it? I know Mehta spent some time really saying he didn’t see evidence of a causal connection between the defendant’s anticombative behavior and its dominant position in the relevant market. How do you read this treatment of that question? And do you have any disagreements with how he approached that question?

JOHN NEWMAN: Yeah, causation is an absolute mess in the D.C. Circuit. That’s absolutely due to the Microsoft opinion, which I think imposes like three new causation requirements out of nowhere, nowhere in the case law at least. Judge Mehta seemed to get really hung up on two of the causation requirements, which go to remedies rather than liability.

And he ended up—rather than doing just what Microsoft said or just what the plaintiff asked or just what the defendant asked—he ended up doing this honestly kind of bizarre new thing. This is a fifth way to do causation analysis for remedies, where he basically said, I’m going to look at the strength of the connection between the conduct and the market power. And then I’m going to look at the severity of a remedy on a spectrum of not severe at all to really severe, I guess. And then I’m going to make sure those two things kind of line up. So, I guess I’ve got two spectrums and I’m going to make sure that the two data points on the two spectrums are like roughly in the same place. They’re not here or here.

Just describing that sounds kind of bananas. It’s like totally apples to oranges. How are you supposed to know exactly where you are on either of these spectrums? And how does that map onto even this case, right, where you’ve got multiple aspects of conduct — like six, right?, — illegal instances of conduct? Not clear which of them contributed what to the exact monopoly power of Google. And you’ve got a multi-part remedy. Like is each part supposed to line up with each part? Is it the overall mess compared to the overall mess? Just no guidance even to himself on how to do this. That’s pretty wild. That would probably be my secondary line of attack on appeal to say there’s no precedent for this. And it’s totally unworkable.

TEDDY DOWNEY: Yeah, I’m interested to see what happens even if the DOJ or the states actually end up appealing. And so, I think one thing that hangs over all of this is there’s a lot of doom and gloom. There’s a lot of people saying this is a slap on the wrist. There’s a lot of people saying like, who cares about these cases anymore? But I’m curious to get your take on how this is likely to influence other cases, other Big Tech decisions that we’re waiting on, remedies in ad tech, the Meta case. Does this opinion make those judges more likely to sort of kind of split the baby where they say Big Tech’s a monopoly but they don’t make them really do much? They don’t really punish them that much. Or does it cut the other way? What’s your thinking on the future of these other cases, these other big cases?

JOHN NEWMAN: It’s a great question. I guess a lot of people are peering into this particular crystal ball today. I would say taking them in turn—well, the Epic v. Apple, Epic v. Google case is mostly done, right? So, no real effects there as far as I could see.

AdTech, Judge Brinkema has already signaled she’s not going to be slavishly devoted to whatever goes on in the D.C. Circuit. If anything, kind of the opposite. That case also has different facts than this case. There you’ve got an obvious acquisition. There’s a fault line already drawn for you if you want to do a breakup. So, just different from this case where that arguably wasn’t the facts.

So, I don’t see huge implications for AdTech, to be honest. Nor do I—and this may be the spicier take—see huge implications for the FTC v. Meta case, given the current status of that case. So, it started out as a case where it was a combination of conduct by Meta and these acquisitions of WhatsApp and Instagram. Well, we’ve got a pretty limited case now. It doesn’t involve the conduct at all. It’s just the acquisitions.

So, in some ways, that case is almost boxed into you’ve got to do a structural remedy or nothing. And what could you do short of structural relief that would fix that problem? So, that one may be the harder take. But honestly, I don’t see this having huge ripple effects for either one of those ongoing cases.

TEDDY DOWNEY: I think some people are speculating that in the Meta case, the judge will do kind of what Mehta did, which is like, well, say you’re a monopolist, but end up not doing anything about it as a sort of a strategic path that sort of, say no, you’re naughty, Big Tech, but then not provide some political cover for actually doing nothing on the remedy. Just be like, well, this isn’t a problem anymore. AI is here. TikTok’s here. In that respect, do you see that as a model? I mean, that’s kind of an obnoxious way to think about judges. But I’m an obnoxious person. So, I’m going to ask the question.

JOHN NEWMAN: Yeah, I mean, they all work in the same building, right? It’s possible. My read on Judge Boasberg is he’s got a kind of an independent streak. So, I don’t think he’ll feel like he has to follow anybody’s lead here. And I suppose you could probably craft some do-nothing remedy short of a breakup for the Meta case. Maybe it’s some kind of like firewall between the different companies. Or maybe it’s some kind of syndication of whatever that might be, user interactions.

NATE SODERSTROM: John, let’s not give anybody any ideas here.

JOHN NEWMAN: Yeah, I guess I should disclose that I worked on that case pretty closely while I was at FTC. So, any of this would cause me to immediately leave work and go to the nearest bar and start drinking heavily. But yeah, there’s a world in which that’s possible. Again, I think the die is mostly cast in Meta, in FTC v. Meta, and I don’t see this playing a big role. But there is a possibility there.

NATE SODERSTROM: John, if you are someone who is, let’s say somebody who supports aggressive anti-just enforcement against the Big Tech platforms, is there a glass half full reading of this opinion? You actually come off as a bit more sanguine than I think some of the more hysterical takes we’ve seen. Hysterical is the wrong word. From some other takes we’ve seen from some other folks, you seem a bit more optimistic. Are you? Is there a glass half full reading of this? Again, for the broader project of anti-just enforcement against, call it, Big Tech platforms?

JOHN NEWMAN: Yeah, I mean, if I seem a little more upbeat than some people, that’s probably for two reasons. One is, I came out of the Hovenkamp School of Antitrust. Literally, I took his antitrust class. I was his research assistant. So, I think my expectations for this remedy were probably in a somewhat different place than some people who maybe came to this a little more recently than I did. So, part of this is just, hey, my expectations were not the moon. And this does more than my bargain-basement expectations. So, yeah, I think that’s something that people should keep in mind, just sort of expectation management and compare this to the worst possible remedy order. This is better than that.

Two, oof, I’ve been doing this long enough—and Teddy, you have too—to remember when even the question of can antitrust apply to a free product? That was a real live issue, right? That was a big, hot debate ten years ago. And there were people, antitrust luminaries, saying, nah, this is a zero price product. There’s no antitrust liability here at all. These aren’t even markets.

So, if I seem a little bit happier than some of you, I think it’s partly because I’m realizing, “hey, we’ve come a long way in a pretty short amount of time.” When you look at the grand scheme of history, to go from, ten years, starting point is “does antitrust law apply at all here?” to we’ve got multiple federal judges saying that Google illegally monopolized now six different markets. That’s not bad, right?

So, I think, kind of keeping the long view in mind, realizing we did get a liability decision here, thinking back to 2013 when the FTC just sort of abandoned its investigation and did nothing, yeah, the world has changed.

TEDDY DOWNEY: So, sort of following up on that, and going back to some of the stuff we said before, Google’s obviously happy. I’m sure Apple’s also ecstatic that they get to keep taking that high margin, billions and billions and billions of dollars every year for doing nothing. And then, but who else is it good or bad for? I mean, like I know the newspaper industry has been decimated by Google and Facebook over the years. How do they fare in this? Could they see some silver lining in it? Maybe the door is open for AI to sort of chart a new path in which they’re not completely obliterated online. Or the AI companies, is it good for them at all? How do you see this in terms of other constituencies?

And I do think that this was a big, this was a high stakes case for the news industry. And that one in particular, you start thinking about not being able to fund news. That seems like a threat to democracy. It’s sort of a bit of an existential question here in some respects. So, I want to get your take on sort of the impact on the other stakeholders here.

JOHN NEWMAN: Yeah, winners and losers. So, by and large, I think if I’m thinking about this from the news industry perspective. I’m not over the moon about anything in this remedy order. That said, probably a couple of wins out there.

One is this weird little part of the order that I think escaped most people’s attention. But Judge Mehta required Google to disclose any material change—disclose in advance, I think—any material changes that Google makes to its advertising auctioning sort of procedures. That’s kind of wild, honestly. It’s a narrow little thing in a sense relative to the overall scope of the case, but it’s not something he had to do. It’s not like super closely related to the core illegal conduct.

So, that kind of jumped out to me. And the justification for it, I think, as far as I can gather, is Google is almost purposely deceptive, or at least super opaque about how they run their advertising auctions. That just makes the online ad space work in Google’s favor and to the detriment of everybody else. It just increases Google’s cut basically. Making that market work better overall is good for everybody involved, except maybe Google, including newspapers. I think I like that. I have some hope that the ad market starts working a little better.

I also think—I think there’s a chance that some rival gen AI company is going to start eating Google’s lunch. We’ll see some real competition here. That’s probably a double-edged sword, though, for the news industry.

On the one hand, hey, if Google isn’t a super-monopolist, maybe I can get a fair price for my ad inventory. On the other hand, if Gen AI companies are scraping news content just as badly as Google does, and the order doesn’t do anything about Google’s scraping of content or empower publishers to decide how Google can use their stuff. DOJ asked for it. The judge said no.

TEDDY DOWNEY: Nate, do you have other questions? I’ve got some lined up.

NATE SODERSTROM: John, one more on the anti-circumvention and anti-retaliation remedies, or lack thereof. DOJ asked for anti-retaliation, straightforward anti-circumvention. Basically, broadly worded, but the idea is it prevents any conduct that would attempt to replicate some of the conduct found to be illegal. Mehta did not put these in, felt they were too vague in particular. Do you have any kind of reaction to DOJ’s request and Mehta’s treatment of those proposed remedies that, of course, will not make it in the final order?

JOHN NEWMAN: Yeah, surprising to me that he wouldn’t include them after we just watched, and are watching still, the Epic v. Apple saga continue to unfold, where Apple paid presumably some really smart lawyers to look at the state of the law and say there’s at least enough wiggle room or fuzziness that you can circumvent this remedy and we think you might not get in trouble. Or at least we think the trouble you get into won’t outweigh the benefit of doing end runs around the remedy.

So, that tells me — we’re kind of reverse engineering this — the law isn’t as clear as it should be. I do think the law is on Epic’s side there, and I think they will win their appeal before the Ninth Circuit. You can’t just obviously replicate illegal conduct and get around the letter of the law in a remedy order. But there’s at least enough fuzziness that it’s apparently worth gambling on, and so why not? There’s like such a low cost to a judge to include a provision like this in order. Why not do it? I just don’t see the case against it.

He says it would violate the federal rules of civil procedure. I mean, how can we know that until we see what you put in the order, right? The rule that he has in mind says if an order is too vague, then it’s unenforceable, but there’s a solution to that. Just make it a little more specific, right? It’s really hard for me to see how he ran his cost-benefit calculus and said, no, I’m not going to do anything here.

TEDDY DOWNEY: There is some weird language around the default decision where he says, maybe we could come back and ban these? And then he also says another possibility is allowing Google to make payments for distribution, but not for default distribution. But plaintiffs have not proposed that remedy as an alternative. And the court did not hear testimony from expert economists about it. Without a more substantial record, the court is presently ill-equipped to consider. It seems a little odd to come up with your own idea and remedy and then say you don’t understand it well enough to put it in an order.

But what was your reaction to these weird stipulations around the default decision? I don’t understand how can you just put it in there? Maybe we’ll come back to it. How does that even work? The monitor says, oh, this isn’t working. Well, everyone’s going to say it’s not working, right? Like if you wanted to ban it, just ban it. You’re just going to do this weird thing where you say, maybe I’ll ban it later. And like, by the way, there’s this other solution. What’s your take on those the hemming and hawing around the default decision?

JOHN NEWMAN: Yeah, perhaps indicative of a certain judicial temperament. I was struck by a kind of a similar passage where, getting back to the liability causation and the remedy causation question, there’s this really bizarre part of the opinion where Judge Mehta says, yeah, I do need to assess how strong the causation was in my liability opinion. And I’m just going to do that on a blank slate. Like, I’m not bound by my own liability opinion. I can now re-decide how strong the causal connection was.

Kind of a wild way to do judging, right? Usually when you issue your opinion, that issue is settled. Apparently, he doesn’t feel that way. And apparently doesn’t feel that way about this particular part of the remedy order, which I guess, to be fair, yeah, you can modify orders down the road. If, say, your technical committee reports a bunch of problems, DOJ moves for a modification, you could revisit this. So, that may be what’s going on here.

TEDDY DOWNEY: Nate, any more questions?

NATE SODERSTROM: Teddy, you were on a roll. So, if you have anything else, I’m going to take a step back and let you to, especially if you have listener questions or anything else.

TEDDY DOWNEY: Is there anything about the data sharing requirements and that type of stuff that you think will really work well? Or look, I think behavioral remedies, most people think are, at this point, kind of a joke and never going to work and there’s always an end around. I mean, at least that seems to be not necessarily totally consensus, but like that has kind of been the way things consensus has been going. Do you think these are done in a way that they could really work? Or not? Or is there anything, any little aspects of them, that you think are particularly good or particularly problematic?

JOHN NEWMAN: Yeah. I want to be optimistic on some part of this opinion, and this is the part to be optimistic about, I think. So, grain of salt. I think what I’m about to say may be a little bit optimistic. But I do see some hope that this could work, right? Given that there are other companies out there itching to make some sort of querybased, like let’s say it’s an agentic AI app. There’s a lot of companies out there looking to do this. They have a lot of funding right now.

There is some disclosure of the search index, which is huge. We got a bunch of testimony about that at trial. And then some disclosure of user interactions. It’s not very granular. That’s probably not going to be that helpful. But at least something that you could use to help you start indexing down the road. That’s cool.

And then syndication of search results. Useful if you are building something that incorporates search but isn’t limited to search, right? In fact, that’s perfect.

So, yeah, I’m a little bit optimistic. I’m, frankly, a little bit skeptical on some of the caveats and carve-outs. Like, for instance, if Google acquired some data through a partnership. So, if Google paid TikTok a ton of money to get a bunch of unique data on user interactions on TikTok, that’s not fair game for this disclosure type remedy. Why not? Unclear to me, right? I guess the reasoning is, well, these rivals could go out and do the same thing. Yeah, but the rivals don’t have two decades’ worth of monopoly rents to throw around.

So, yeah, there’s room to be skeptical, just given some of the carve-outs here. But overall, I’m trying to be optimistic on this.

TEDDY DOWNEY: And we talked about DOJ’s chances on appeal. Google’s appealing on liability. What do you think are the strengths and weaknesses of their appeal? Or in general, how do you see that playing out?

JOHN NEWMAN: I candidly think they have kind of a weak grounds for appeal. I think both these opinions will mostly stand, if I had to predict, on appeal. Google’s strength, if I were advising Google, free of charge, which I would never do, I think would be to probably lean into the idea — which they’ve already leaned into, so, it’s not giving anything away — lean into the idea that you just can’t disentangle us being a really good search engine from any contribution to that caused by this conduct. We already came into this with an overwhelmingly dominant market position. That’s because we just built the best search engine. We built the best mousetrap. And Judge Mehta’s after-the-fact, kind of ex-post reasoning about causal connections should not be considered at all, because they came in a remedy opinion, not liability.

And so, yeah, that’s just irrelevant. Let’s appeal liability. Let’s say there’s not enough causal connection identified. To me, that’s probably Google’s strongest argument.

Market definition, they’re weak on. Market share is overwhelmingly high. So, they’re weak on that. The conduct is pretty clearly exclusionary.

So, I think if you’re kind of ticking through your boxes, all you’re left with is saying, well, okay, but it didn’t have that much of an effect. You haven’t proven it caused our monopoly.

TEDDY DOWNEY: We’ve got another question here. How do you think this affects EU’s process on Google? I mean, they’ve already kind of walked away from their fine, at least for now. Trump has been out there yelling at them anytime they suggest they’re going to do anything on Big Tech. But if you’re the EU—and at least the EU does have a bunch of rules on AI—if you’re the EU, what do you think the reaction to this type of thing is, this type of decision?

JOHN NEWMAN: Hard to say, just because all bets seem to be off in the EU right now. They’re apparently willing to give away the store and then some in exchange for a lessening of tariffs. Which, yeah, if you’re thinking at a macro level, I guess that makes sense.

I think my sense is, at least among people in the EU who aren’t necessarily at the highest levels of DG Comp, but are involved in their competition discussions, it just seems like there’s a growing sense that these Big Tech companies, they are an American problem. Let’s let the U.S. deal with them. If the U.S. is not, then let’s stop spending our political capital trying to clean up the U.S.’s dirty laundry here. But my sense is they may continue to kind of back off and let this play out.

TEDDY DOWNEY: We’ve got another question here, similar. It’s kind of very along the lines of what I already asked, but a little bit more specific. The judge said he would revisit the payment ban if the market share doesn’t change as he expects. What do you think about the timeline for a potential revisit? I mean, like I said, I don’t really expect the market share to change at all, personally. But curious to get your thoughts on when the judge was like, hmm, this didn’t work. Maybe we should take another look, how long that would be.

JOHN NEWMAN: It’s a great question. I’m not sure there’s a great answer. So, I’m just going to give like a gut level reaction. I would say you’ve got to give this remedy two years to see if it works. For whatever reason, that seems to be just kind of a usual timeline horizon in antitrust. When we’re doing merger analysis, we ask, well, will entry occur in two years? Why two? I don’t know. But it seems to be just kind of a general heuristic. So, I think you’ve got to give it a couple years. And you’ve got six years total on the remedy. So, you have some time.

TEDDY DOWNEY: Yeah, it seems very scientific.

JOHN NEWMAN: So, much of what we do is extremely precise, very scientific.

TEDDY DOWNEY: In general, just taking a step back and putting this in context of just, like you were saying before, just in the if you take a step back and you look at the historical arc here. Yeah, I think it’s fair to say this is a pretty weak remedy. And you’re optimistic that like we’ve come a long way. But in some respects, there’s not much really happening to the market, right? And so, how aggressive do you think these remedies need to be to actually address real monopoly power?

I mean, we see so much power right now. You can just look at the concentration in the stock market, the stability of the returns, the earnings power, any indicia of market power that you can possibly want, you see it. Political power, outsized political power. You hear about the FT metas, people being in the White House all the time. You see the President constantly touting Big Tech’s talking points on trade. How far away are we from the decisions that actually address that power?

Or do you think that, look, antitrust is just not going to be the way to do it? This thing takes seven years. You’re going to need to get Congress, you’re going to need to get other government agencies. involved. What’s your sort of holistic view on corporate power and antitrust role in addressing it?

JOHN NEWMAN: Hmm. Teddy, you always ask me the easiest questions. That’s why I love you.
Man. Okay, so stepping way, way back. This is like grand arc of history level. To me, antitrust has never been the solution, right? It has always been, at its best, either a complementary part of a much broader statutory and regulatory toolkit or it has been a necessary step on the way to something like that.

NATE SODERSTROM: Are you suggesting that it is a [17:48] policy is a side dish and not in fact –

JOHN NEWMAN: Never. Nate, you’re trying to get me in trouble here. No, it’s never a side dish. Sometimes it can be the entree to be followed by the main. Sometimes it’s just part of the meal. Never a side. If we look back at U.S. history, you saw antitrust, traditional antitrust, tried as an attempt to respond to the Gilded Age problems that are very similar to ones we see today, right? Widely viewed as ineffective. But we had to try it in order to have a convincing case to be made that we need a broader set of tools. That’s how we get the Clayton Act. That’s how we get the FTC Act, right? And so on; those are not the only Progressive Era reforms. So, that seems a little cynical, I guess, but that’s a really important societal function for law to play. Sometimes antitrust has to be tried on its own for us to see that it can’t be the only solution.

Second, where we’ve also seen antitrust be really effective, I think, is like in the, let’s say, ‘50s to ‘60s. Where super active monopolization enforcement is also coupled with super active merger enforcement and super active FTC Act enforcement on unfair methods of competition to catch like even more nascent conduct by these companies. And coupled with like strong civil rights reform, strong labor reforms, environmental reforms. Like antitrust is part and parcel with all of that. All of those together, I think, shift the balance of power in society. But antitrust on its own can never do that.

So, then, where are we today? Optimistically, we’re in one of those two scenarios. Either we’re trying antitrust and seeing it not be a silver bullet to be followed by, hey, let’s build it back up with its buddies. Or we’re seeing antitrust as like there’s fits and starts of it becoming a part of a broader set of enforcement, given the tools we already have.

I don’t know where we are exactly. Where does a case like this leave us? But if those are the two good outcomes here, we’ve got to start doing stuff. Like the only way to not get either of those is to do nothing.

TEDDY DOWNEY: Yeah, I think that’s at least, you’re an eternal optimist. I like how you think. Nate, we’ve got a couple more questions from the audience, but do you have any other thoughts? I mean, John, we’ve covered so much ground. Were there any other things that you thought were just sort of interesting little anecdotes or things that we haven’t touched on about the decision that you thought were interesting or worth pointing out?

JOHN NEWMAN: I’m trying to think. I think we hit the high points. Yeah, I think we hit the high points.

TEDDY DOWNEY: One thing about liability that I’ve always thought is interesting when you say, hey, you’re a monopolist, at least that does open the door. Let’s say, look, you just say you’re a monopolist, but then you don’t do anything on the remedy. At least that does open the door to a lot of private litigation. And obviously, I think with some of the crazy stuff that you’re seeing at DOJ and FTC right now, it’s hard to get super excited that there’s going to be a lot of robust antitrust activity there on mergers or conduct beyond the cases that are already going. And private litigation is really, alternatively, and at the state level, ramping up. It’s very interesting. It’s an interesting place to look.

And how do you think of all these decisions that say, hey you’re a monopolist, but how much of a roadmap is that for your private litigants to actually get in there, get some money if you’re a news company or be more aggressive on the litigation front, open the door to litigation? We’ve seen Shaoul is a great example. They’re doing a bunch of cases, Robinson-Patman, other types of cases, because the door has been opened there by federal law enforcement. What’s your take on the opportunity here for private litigation to sort of step into the role as the federal enforcers take their foot off the gas?

JOHN NEWMAN: Yeah. It’s all good. This opinion is almost all good from a private enforcement perspective, right? These weren’t probably the kinds of remedies you were going to go after anyway. If you’re a company that’s been driven out of business by Google’s practices, none of this really does anything for you. You need some money to be made whole. Nothing about this opinion stands in your way, I don’t think.

I would say too, part of the difficulty of bringing and winning any of these Big Tech cases is each one was like the first of its kind. I thought about that a lot when I was at FTC and we filed the Meta/Within merger challenge, which is the first U.S. litigated merger challenge against any Big Tech company. After what? Over 1,000, by some counts, acquisitions? It’s just really hard to win that first case because you’re fighting such an uphill battle. There’s just so much—well, back to our vibes discussion. There’s just so much vibes around like, whoa, the world will end if we crack open this door to liability. The door’s been cracked now.

So, now instead of having to fight like five battles to get a win, you’ve already got, hey, Google has a monopoly in, I think I said, six different markets. I don’t really have to relitigate those if I’m in those spaces. And Google can, and has, engaged in illegal conduct. That’s all for the good. I think it just helps your narrative, helps you not have to fight such an uphill battle from the get-go as a private litigant. So, yeah, I think a real silver lining.

TEDDY DOWNEY: And this is not about Google, but it is about the DOJ Antitrust Division. So, I think it’s fair game. We have written a lot about this HPE merger and the goings on around that merger at the DOJ and the possibility of a Tunney Act process actually being like a real court process, a real hearing, with real consideration of the potential for misconduct.

Do you believe that the Tunney Act will ever have such a—do you think that’s even possible for a judge to really take the Tunney Act seriously enough where we will see that happen? And would you expect something—is this the type of conduct that you would say, okay, well, you’re a judge. We do need to kind of take this seriously and take a closer look.

JOHN NEWMAN: Yeah, it’s super interesting. I’ll confess I haven’t dived in on the particulars of the facts there. So, without sort of weighing in on the merits of a Tunney Act challenge, if there was ever going to be a Tunney Act proceeding that sort of breathed new spark into that statute, I think it’s probably this one, if for no other reason than it’s not in D.D.C., where federal judges are so accustomed to just rubber stamping these things. They have this apparently unspoken agreement that the Tunney Act doesn’t really mean anything. Maybe Judge Leon is the one sort of exception to that, but even then, not really.

If you go to a new district, judges haven’t been in the habit of rubber-stamping these things for what? Fifty years? They’re just looking at a statute that says they’re supposed to review this settlement, see if it’s in the public interest or not. I just don’t think you have as much baggage as you do in the D.D.C.

So, setting aside the merits again, this is a congressionally passed law. It’s on the books. It should have some force. It should have some vitality. If we’re going to nullify it, Congress should do that, not courts. So, yeah, I mean, I don’t know if this should come out with a ruling that says go back to the drawing board. But if it ends up with Tunney Act as a real statute again, I think that’s a positive.

TEDDY DOWNEY: All right. Well, this has been amazing, as always. I love hearing your thoughts. You’ve got one of the most gigantic brains of anyone I’ve ever met. It’s such a pleasure to talk to you. I hope you enjoy Memphis. I hope you don’t miss the weather or anything like that in Miami. I think it’s good to get out of there, get in Memphis, enjoy the Midwest.

NATE SODERSTROM: Memphis is a longer discussion. Memphis is not in the Midwest.

TEDDY DOWNEY: Sorry, South?

NATE SODERSTROM: We can have that discussion later. Where is Memphis geographically? Let’s defer to John on this.

JOHN NEWMAN: Yeah, it’s the Mid-South. This conversation is telling me I’ve got to get you guys down here for some anti-monopoly event. So, keep an eye out for an invitation.

TEDDY DOWNEY: The Mid-South. I like it. All right. Well, thank you so much, John. Nate, thank you for doing this. I’ve got to do my outro here. Please, if you enjoyed this, drop us a line at podcasts@tcfpress.com. If you have any other future topics or anything, thanks to everyone for joining us. And, John, again, thanks so much for doing this.

JOHN NEWMAN: Thanks for having me.

TEDDY DOWNEY: All right. Bye, everyone.