FTC Chief Won't Recuse Herself As Google-DoubleClick Case Heats Up6:12 PM EST Fri. Dec. 14, 2007
The controversy over Google's proposed $3.1 billion purchase of online advertising company DoubleClick has ramped up, with FTC Chairman Deborah Platt Majoras refusing to remove herself from the case, as demanded by privacy groups.
The Electronic Privacy Information Center (EPIC), and the Center for Digital Democracy (CDC), said Majoras should recuse herself because DoubleClick uses the services of the law firm of Jones Day, where FTC Chairman Majoras was once a partner and where her husband, John M. Majoras, is also a partner.
But Deborah Majoras said the law firm is not representing DoubelClick in litigation before the FTC. "My husband does not represent any party in the Google-DoubleClick matter," she said in a statement. "He is in no way connected to the matter, nor are any of the parties to the matter otherwise currently his clients."
Majoras' husband does represent DoubleClick before European regulators, although he is not an equity partner in the law firm and so would not make money from the DoubleClick-Google outcome, Majoras said.
"Any decisions that I may make in any case in which Jones Day represent a party cannot be said to directly and predictably affect my husband's interest in Jones Day. Hence, I do not have a financial conflict in this matter," Majoras said in the statement.
Other FTC members also said they would not step aside in the Google-DoubleClick case. Another FTC commissioner, William Kovacic, said his wife also worked for Jones Day, but was not involved in the Google-DoubleClick case. "I have determined not to recuse myself," he said in a statement.
The other three commissioners, Jon Leibowitz, Pamela Jones Harbour, and J. Thomas Rosch agreed that Majoras and Kovacic need not step aside. "We see no legal grounds that would disqualify them from participating in the investigation of the Google-DoubleClick transaction," they wrote in a joint statement.
The privacy groups said they "do not accept the premise that the spouse of the Chairman should represent a client in a then pending matter and profit from the outcome that is favorable to the client. Such an outcome calls into question the ability of the Commission to render decisions that are fair and just."
The EPIC and CDD said they will file a Freedom of Information Act request with the Commission seeking all records concerning the relationship between Jones Day in the Google-DoubleClick matter, "as well as any other matter involving Jones Day and the investigation of consumer privacy complaints or the enforcement of consumer privacy law at the Commission," they said in a statement.
The Google-DoubleClick matter had gained national attention before the privacy groups asked for Majoras' recusal.
Earlier in the week, U.S. Rep. Joe Barton, R-Texas, the ranking Republican on the House Energy and Commerce Committee, wrote to Google CEO Eric Schmidt that he was concerned about "potential consumer protection and privacy implications of the merger."
Barton said that although Schmidt at first seemed interested in working with Barton, the congressman said Google had rebuffed his efforts to visit Google at its corporate offices in Mountain View, Calif. "Your warm initial invitation followed by Google's chilly response to a proposed visit by Committee counsel is disconcerting." Barton wrote. Since then, Google has said the holiday scheduling is to blame for any miscommunication.
The proposed purchase has had the attention of influential lawmakers for weeks. Last month, Sen. Herb Kohl, D-Wis., chairman of the Subcommittee on Antitrust, Competition Policy and Consumer Rights, and Sen. Orrin Hatch, R-Utah, the ranking Republican Member of the on the Subcommittee on Antitrust, Competition Policy and Consumer Rights, wrote to Majoras expressing concern about implications of the proposed deal.
"By virtue of its dominance of the Internet search market and its recent acquisitions, including last year's acquisition of YouTube and its current planned acquisition of DoubleClick, Google is becoming the world's most important Internet enterpriser," they wrote.
If the deal is consumated, Google, already the dominant Internet search company, will also hold a leading position in video content, news, advertising and a myriad of other consumer services, the senators said.
"Antitrust regulators need to be wary to guard against the creation of a powerful Internet conglomerate able to extend its market power in one market into adjacent markets," they wrote, "to the detriment of competition and consumers."