SAN FRANCISCO — Online reviews company Yelp sued Google on Wednesday, alleging the search giant has used its power over the web to benefit its own reviews business and unfairly shut out the smaller company.
The suit adds to a string of recent legal challenges to Google’s dominance, including court rulings that declared its search business and mobile app store to be illegal monopolies. Google is appealing both cases.
Yelp, a pioneer of online reviews for local businesses, has long accused Google of anti-competitive conduct, lobbying for stricter oversight of how the giant handles searches for restaurant and business reviews. But until Wednesday the company had never sued Google.
The new lawsuit is the first major legal assault on Google since the antitrust ruling earlier this month against its search business. Yelp argues that Google gives its own reviews preferential placement in search results, directing traffic away from Yelp even though its reviews are higher-quality and more helpful to people.
“Our case is about Google, the largest information gatekeeper in existence, putting its heavy thumb on the scale to stifle competition and keep consumers within its own walled garden,” Yelp chief executive Jeremy Stoppelman said in a blog post Wednesday.
“Yelp’s claims are not new,” said Google spokesperson Peter Schottenfels. “Google will vigorously defend against Yelp’s meritless claims.”
Google’s two earlier antitrust defeats, both in the past year, could undermine the company’s massive power over the online economy. In December, a jury found in a case brought by another smaller rival, Epic Games, that Google had broken competition law by using its control of the Android mobile phone software ecosystem to make it harder for competing companies to build app stores that might compete with Google’s own app store. The ruling on its search engine business, in a case brought by the Department of Justice, came earlier in August.
In both cases, federal judges will now decide on how to penalize Google. Potential outcomes include banning the company from making certain commercial agreements, such as deals that make its search engine the default on smartphones, or even forcing the sale of parts of its business.
Google’s defeats and the prospect of similar results from upcoming lawsuits against other tech giants including Apple and Amazon have energized antitrust activists and some legal academics, who have long argued for stricter interpretations of competition law to rein in the growing influence of Big Tech over the internet economy.