Utah AG: Court likely to approve Utah-led $700M settlement vs. Google

Utah Attorney General Derek Brown, the Utah Department of Commerce’s Division of Consumer Protection and a bipartisan group of 52 other attorneys general nationwide have announced a federal court has indicated that it will approve a $700 million agreement with Google. 

The complaint against Google cited its anticompetitive conduct concerning payment processing and app distribution within the Google Play Store. 

The case, Utah et al. v. Google LLC, was filed in U.S. District Court for the Northern District of California and heard by Judge Jacqueline Scott Corley.

The lawsuit claimed that Google used its power to enter into exclusive agreements that prevented companies from gaining access to key distribution channels. This resulted in higher prices and fewer choices for both developers and consumers. Under the settlement, Google will have to pay consumers and substantially change its payment practices on the Google Play Store. Additionally, Utah is expected to receive around $10 million for its sovereign claim and costs.

“Google’s monopoly over the Play Store has hurt everyday Americans and small businesses by jacking up prices and limiting choices,” said Brown. “The bulk of this $700 million settlement goes directly to consumers who were overcharged for in-app purchases. I’m proud Utah has been a leader on the national stage in holding Google accountable for its conduct.”

Google will pay $630 million, minus costs and fees, to consumers who made purchases on the Google Play Store between August 2016 and September 2023 and were harmed by Google’s anticompetitive practices. Consumers eligible for recoveries do not have to submit a claim. They will receive automatic payments through PayPal or Venmo, or they can elect to receive a check or ACH transfer. Google will also pay the states an additional $70 million for their sovereign claims.

“Today marks an important milestone in restoring trust in the app store marketplace. This settlement addresses the harm caused to consumers by Google’s deceptive practices and paves the way for a more transparent and fairer environment for all users,” said Margaret Busse, executive director of the Utah Department of Commerce.

In July 2021, Utah led a bipartisan coalition of 37 attorneys general in suing Google, alleging that Google unlawfully monopolized the market for Android app distribution and in-app payment processing. Specifically, the states claimed that Google signed anticompetitive contracts to prevent other app stores from being preloaded on Android devices, bought off key app developers who might have launched rival app stores and created technological barriers to deter consumers from directly downloading apps to their devices.

The coalition announced a settlement in principle on Sept. 5, 2023, which has been pending before the court ever since. Additional details concerning notice and claims will follow the judge’s final approval of the settlement, Brown said.

In addition to restitution to consumers, under the states’ settlement, Google will be required to reform its business practices, including giving all developers the ability to allow users to pay through in-app billing systems other than Google Play billing for at least five years. Google will also be required to allow developers to offer cheaper prices for their apps and in-app products for consumers who use alternative, non-Google billing systems for at least five years.

Other business practice changes that Google will adhere to involve elimination of practices like exclusivity contracts and giving support for other providers of apps for Android devices. Google will be required to submit compliance reports to an independent compliance professional who will ensure that Google is not continuing its anticompetitive conduct for at least five years.