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Google and All 50 States Defend $700 Million Consumer Settlement

 |  April 18, 2024

In a concerted effort, Google and representatives from all 50 U.S. states have jointly urged U.S. District Judge James Donato in San Francisco to approve a comprehensive $700 million consumer settlement. This endeavor aims to address allegations of Google inflating prices within its app store. The initiative follows earlier scrutiny by the judge, who had questioned the adequacy of the proposed deal back in February.

According to reports from Reuters, Google and the states expressed confidence in the fairness and adequacy of the settlement in a pair of court filings submitted late Wednesday. They underscored the significance of the substantial settlement amount and highlighted the commitments made by Google’s parent company, Alphabet Inc., to implement pivotal changes as part of the agreement. Google emphasized the unprecedented nature of its commitments to overhaul its app store, Play.

The settlement proposal arose from claims that Google had infringed antitrust laws by imposing stringent control over app distribution and payments, thereby limiting competition. While Google denied these allegations, it acknowledged the necessity of fostering a more competitive environment and committed to facilitating greater flexibility for developers and consumers alike.

Related: UK Watchdog To Probe Google Chrome Changes Over Antitrust Concerns

As part of the settlement, Google pledged to streamline the process for developers to inform users about alternative payment methods within apps and for consumers to directly download apps from the web. The agreement encompasses a financial package of $630 million allocated for consumers and an additional $70 million designated for the states.

Despite the considerable sum allocated for consumers, concerns had been raised regarding the relatively modest individual payouts within the proposed deal. Judge Donato sought further clarification regarding the constraints imposed on Google’s conduct as outlined in the settlement terms.

The states disclosed that, following deductions for legal fees and associated expenses, an estimated $515 million would be available for eligible consumers, with an average individual award of approximately $4.41.

Furthermore, the states emphasized a significant provision within the settlement that allows for potential legal recourse in the event of non-compliance by Google over a seven-year period. This provision was hailed as a hard-won victory, enabling both the states and consumers to pursue further action if necessary.

In addition to the consumer settlement, Judge Donato is currently deliberating a related case brought against Google by Epic Games, the developer behind “Fortnite.”

Source: Reuters