The New Public Square of Opinions: Technocratic Giants and Public Utilities
Following a series of state-led cases against technocratic giants, Ohio attorney general David Yost attempted another path to regulation through a 2021 lawsuit demanding that Google be declared a public utility and Google Search become a public utility in the state of Ohio. Such a lawsuit, if successful, would subsequently place Google under the supervision of the Public Utilities Commission of Ohio (PUCO). [1] Public utilities are generally defined as private and public entities that provide essential service to the public, most often in association with energy and telecommunication establishments. [2] The concept of a public utility originates in the Public Utilities Holding Companies Act of 1935 (PUHCA), a law that is antitrust in nature, as the lawmakers who passed it intended for the Securities Exchange Commission and the Federal Power Commission to have the power to regulate and break up electricity companies. However, the emergence of transnational corporations and metaphysical forms of “utility” cast doubt on the applicability of this concept to present times. In fact, U.S. legal precedent indicates that Yost’s demand of Google’s appointment as a public utility would not only require extensively pioneering judicial interpretation, but would also come into instant conflict with platform-wide guidelines and algorithms, ultimately conferring economic disadvantages upon Google users.
Though Yost argues that the determination of public utilities can be decided at the state level—as PUHCA intentionally established that company operations should be statewide and thus governed under individual state control—the growing phenomenon of interstate commerce makes this requirement almost impossible to follow. This is illustrated by the 1953 Supreme Court ruling for United States v. Public Utilities Comm’n, which runs contrary to Yost’s position. In Public Utilities, the Court held that the rates of energy for sale that involved handling and managing by federal powers (in this case, the Navy) and on federal property would be regulated by the Federal Power Commission, rather than California Public Utilities Commission, because the transactions were deemed as federally-regulated interstate commerce. [3] Under this precedent, federal property usage by Google—whether in buildings on federally-owned properties or server hubs across the United States using local energy—may fall under the authority of federal courts rather than state courts. [4] Due to the transnational structure of Google, the sources of specific searches or data processing cannot be tracked to specific statewide infrastructure, meaning that energy-related disputes will often go beyond state jurisdiction.
Moreover, the Ohio Supreme Court ruled in the 2007 case City of St Marys v. Auglaize County Board of Commissioners that interpretations of statutory legislations such as PUHCA are inapplicable to determining whether specific private establishments are indeed public utilities. Instead, per the St Marys precedent, public utility determinations are to be made on the basis of case law. [5] Therefore, if Yost’s case is accepted by the courts in Ohio, they will only be relying not on PUHCA, but instead on established judicial holdings—which do not outright support his arguments.
Ohio has significantly more public utility-related case law as compared to other states due to their courts’ reliance on these rulings. Addressing disputes over the definition of a public utility, Ohio’s Portage County Court of Appeals established in A & B Refuse Disposers, Inc. v. Board of Ravenna Township Trustees (1992) that public utilities must be a form of essential good or service “to the general public, which has a legal right to demand or receive this good or service.” [6] Further, in Englewood v. Miami Valley Lighting, L.L.C (2009), an Ohio appeals court determined that “the good or service must be provided generally and indiscriminately.” [7] The specific product offered by Google that is under scrutiny in Yost’s case is Google Search. One can argue, as the United Nations and major think tanks such as the Brooking Institute have done, that the right to internet access is universal and must be guaranteed. [8] Indeed, though a right to internet access is not explicitly codified in any legislation or case law, American courts have extended First Amendment regulations such as protection of minors from pornography to the online space, suggesting that the internet may serve as a forum for protected speech of which the public can potentially argue for universal access. [9] However, setting this vaguely-defined right aside, Google Search is a service provided on the internet, rather than the internet itself. Therefore, even if the right to internet access were guaranteed, the general public would likely still not be guaranteed a legal right to demand or receive Google Search.
Based on how public utilities are generally determined, one would expect that the public utility not only offers an essential good, but also holds a monopolizing force on the distribution of that good. This is because, if competitors were more readily available, the service would presumptively be naturally distributed without discrimination. Though U.S. President Joseph Biden’s most recent executive order signals further antitrust actions in the American information technology sector, past monopoly cases such as City of Cleveland v. Cleveland Elec. Illuminating Co. (1995) suggest that regulations may require substantial evidence of monopolization that new sectors such as technology do not necessarily provide. [10] The Sherman Act of 1890, one of the most significant pieces of U.S. antitrust legislation, lists a few directions for substantiating monopoly claims, such as analyzing market share, high profits and anti-competitive effects. Under the Trump administration, the Department of Justice (DOJ) levered the Sherman Act towards further anti-trust legislation. In 2020, the Trump DOJ filed a lawsuit against Google for being a monopoly, citing the D.C. Circuit’s decision in United States v. Microsoft (2001), which declares anti-competitive agreements to be those that shut off “effective distribution channels for rivals, such as by requiring preset default status and making software undeletable, [which is] exclusionary and unlawful under Section two of the Sherman Act.” [11] Following a similar line of reasoning, Yost highlights in his own case this prioritization of distribution of Google’s products to its users: his most substantial demand, aside from legally determining Google Search to be a public utility, is that Google be required to display all search results and products according to its algorithm. Google’s failure to do so, combined with its monopoly status, Yost declares, is directly harming Ohioans.
To substantiate this harm, however, the burden of proof returns to Yost, who would have to demonstrate that Google is a monopoly. If Google did not overwhelmingly dominate the market, then its focus on distribution would simply be part of its regular competitive practices. Currently, more than ninety percent of all internet searches are conducted on Google and its video-streaming platform of Youtube. [12] Despite the continual rise of new social media platforms such as Snapchat, TikTok, and the ever-expanding digital market for small-business owners, toppling Google as the monopoly of internet search engines is difficult both because of the costs of processing large amounts of data and the natural tendencies of user congregation. Indeed, the U.K. Competition and Markets Authority estimated that it would take an investment of between $10 and $30 billion dollars to replicate Google’s search engine. [13] Though theoretically a new search engine with the power to outcompete Google can be developed—indeed, some argue that is what Google did to Yahoo in its founding years—the cost-benefit analysis renders competition practically impossible.
Yet the need for Yost to prove Google’s status as a monopoly arises not only from public utilities definitionally being monopolies, but also from his direct invocation of the Sherman Act. The U.S. Supreme Court ruled in the landmark 1911 case Standard Oil Co. of New Jersey v. United States that the “restraint of trade” described in the Sherman Act—which Yost argues Google has placed upon its competitors and consumers—needs to be perpetuated to an “unreasonable” level for a corporation to be broken up. [14] When Standard Oil lost the original case, its anti-competitive practices ruled as violations of the Sherman Act were as extreme as “espionage of … competitors,” ultimately resulting in “enormous and unreasonable profit.” [15] Following this vein of interpretation, Yost not only has to prove that Google holds a legal monopoly status, but also that its monopolizing methods are indeed “unreasonable.” In an ever-expanding digital universe, however, such a claim is virtually impossible to substantiate due to the lack of a defined market either by geographical limitations or general accessibility.
Additionally, precedent indicates that Yost’s demand that Google “carry information from all sources indiscriminately as compared to Google’s own information” would come into instant conflict with Google’s First Amendment rights as a search engine. In the 2014 California Superior Court case Martin v. Google in California, the plaintiff, an owner of Coast News, alleged that Google was displaying its website lower down in the search result display than would be in the natural algorithm. [16] Google, opposing these arguments, filed a lawsuit intended to decrease similar cases, claiming that this was an attempt to suppress its free speech. The Martin court, in a brief, one-paragraph statement, states that Google “met its burden of showing that the claims asserted against it arise from constitutionally protected activity.” [17] In other words, Google’s manual arrangement of display results is a form of expression protected under the First Amendment. Furthering this interpretation, in Tulsi Now, Inc. v. Google, LLC (2020), a California federal judge ruled that Google held a right to suspend content on Google Ads—including those of plaintiff Tulsi Gabbard’s political campaign—which did not infringe on the political campaign’s First Amendment right to expression. Effectually, this ruling affirms that the public does not have a legal right to occupy space on Google “generally and indiscriminately,” meaning that Yost’s paralleled demand of indiscriminate search result display is highly likely to be dismissed in court. [18] Thus, for the most notable demand of Yost’s public utility suit to be realized—that Google displays the products of its competitors on the same level with those of its own—Yost would have to prove that algorithmic discrimination is substantially harming the good of the public (as unregulated public utilities do). The good-of-the-public argument, similar to Google’s monopoly status, is as unidentified and arbitrary as it is legally invalid. Lacking sufficient proof of this, Yost is forced to concede that Google, even when viewed as a public marketplace, does not “owe” any of its competitors a fair spot on its platform, thus dropping this demand.
Yost’s case is a compelling one for evaluating how, and to what extent, technocratic giants such as Google can be regulated. Certainly, there is hope for legally regulating technocratic giants: Supreme Court Justice Clarence Thomas recently concluded in Biden v. Knight First Amendment Institute at Columbia University (2021) that “in many ways, digital platforms that hold themselves out to the public resemble traditional common carriers,” suggesting that paths for regulation do exist. [19] Yet, in the case of Attorney General Yost, it can be argued that the route of regulation through public utility laws is not a currently viable one. From jurisdictional disputes, to essential goods requirements, to ultimately demonstrating Google’s natural monopoly status, a decision in Yost’s favor would require an overreaching and inconsistent application of current legislation and case law. Perhaps most strikingly, Yost’s case reveals that these existing precedents are regrettably antiquated and insufficient in the face of technocratic giants, which continue to thrive in a cybernated dimension beyond the reach of modern antitrust law.
Edited by Emily Bach
Sources:
[1] Ohio v. Google LLC, 21 CV H 06 0274, 10 (Ohio Ct. Com. Pl. 2021).
[2] Public Utility, Legal Information Institute (Cornell Law School/August 2020), online at https://www.law.cornell.edu/wex/public_utility (visited August 16, 2021).
[3] U.S. v. Public Utilities Comm’n, 345 U.S. 295, 305 (U.S. 1953).
[4] Dan Levy, Google Under Scrutiny / Officials Say It's Dodging Taxes By Building on Federal Land, San Francisco Gate (January 18, 2012), online at https://www.sfgate.com/bayarea/article/Google-under-scrutiny-Officials-say-it-s-2605666.php (visited July 19, 2021); Nikitha Sattiraju, The Secret Cost of Google's Data Centers: Billions of Gallons of Water to Cool Servers, Time (April 2, 2020), online at https://time.com/5814276/google-data-centers-water/ (visited July 19, 2021).
[5] City of St. Mary’s v. Auglaize County Board of Commissioners, 115 Ohio St. 3d 387 (2007).
[6] A & B Refuse Disposers, Inc. v. Board of Ravenna Township Trustees, 64 Ohio St. 3d 387 (Ohio 1992).
[7] Englewood v. Miami Valley Lighting, L.L.C, 182 Ohio App. 3d 58 (Ohio Ct. App. 2009).
[8] Catherine Howell and Darrell M. West, The Internet as a Human Right, Brookings (2016), online at https://www.brookings.edu/blog/techtank/2016/11/07/the-internet-as-a-human-right/; Avisha Sabaghian, Tulsi Nov, Inc. v. Google, LLC: Online First Amendment Rights and the State-Action Doctrine, Harvard Journal of Law and Technology (2020), online at https://jolt.law.harvard.edu/digest/tulsi-now-inc-v-google-llc-online-first-amendment-rights-and-the-state-action-doctrine (visited August 8, 2021).
[9] Id.
[10] E.O. 14036 (July 9, 2021); City of Cleveland v. Cleveland Elec. Illuminating Co., 1977 WL 201341 (Ohio Ct. App. 1977).
[11] Office of Public Affairs, Justice Department Sues Monopolist Google For Violating Antitrust Laws, Justice News (United States Department of Justice 2020), online at https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-antitrust-laws (visited August 8, 2021).
[12] Id at 1.
[13] James Purtrill, Building a search engine to rival Google could cost billions — and that's not the only problem, ABC News (February 13, 2021), online at https://www.abc.net.au/news/science/2021-02-14/google-news-media-bargaining-code-build-search-engine/13143582 (visited August 16, 2021).
[14] Standard Oil Co. of New Jersey v. United States, 221 U.S. 1 (U.S. 1911).
[15] Id.
[16] Martin v. Google Inc. 196 L. Ed. 2d 88 (U.S. 2014).
[17] Id.
[18] Id at 8.
[19] Biden v. Knight First Amendment Institute at Columbia Univ., 209 L. Ed. 2d 519 (2021).