Google Sued by Would-Be Competitor Unlockd for Digital Advertising Market Monopolization

The latest antitrust complaint against Google LLC, filed by Unlockd Media Inc. Liquidation Trust, alleges that Google’s absolute control over the Android smartphone ecosystem drove its young rival out of business. The Northern District of California lawsuit filed by counsel Cravath, Swaine & Moore LLP last Friday, asserts that once Google saw Unlockd as a legitimate competitor, it condemned the company by unilaterally and unwarrantedly banning it from the Google Play Store and Google AdMob, its proprietary network which connects app developers with advertisers who want to buy their ad space.

The filing explains that prior to its bankruptcy, Unlockd was a global technology startup that held much promise. The company reportedly “identified an untapped ‘attention opportunity’ immediately following the unlocking of a smartphone, a user’s most engaged moment, and created a proprietary technology to monetize that opportunity in a way that rewards users for their attention.”

According to the complaint, Unlockd’s application also afforded advertisers hyper-targeted data about its users who opted-in to consensually offer up hordes of information, including their location each time they unlocked their phone. As such, Unlockd allegedly offered advertisers coveted ad space and timing, representing two major advantages over extant forms of advertising.

In the fall of 2017, Unlockd was rumored to debut on the Australian Stock Exchange, the complaint says. Shortly thereafter, Google terminated Unlockd from its Play Store and AdMob, citing violations of its policy that were allegedly baseless. Despite efforts to convince Google otherwise, Unlockd reportedly failed to do so, and without access to distribution through the Play Store or connection to advertisers through AdMob, it was forced into insolvency.

Since then, the filing reports, Google has partnered with a company, Glance, that operates in the same fashion and in the same ad tech space that Unlockd did. According to the complaint, this “underscor[es] the pretextual nature of Google’s objections to Unlockd’s technology and business model.” The filing also asserts that the extent of Google’s stranglehold over the digital advertising market has only become clear more recently, and has now prompted the filing of this lawsuit.

The complaint states a single claim for relief for violation of Section 2 of the Sherman Act. The plaintiff seeks damages, including lost and future profits, to be trebled pursuant to the federal competition statute.