Suit over drop in search engine placement dismissed

(This case came out a couple of weeks ago and has been written about quite a bit, but here’s my take on it anyway.)

Plaintiff Kinderstart.com LLC, the operator of an online directory and search engine for information about the care of young children, filed suit against Google after a “cataclysmic fall” in the number of visitors that the Kinderstart site received. It claimed that Google wrongfully blocked search results for Kinderstart, and intentionally lowered the site’s number in Google’s PageRank system. In an unpublished and noncitable opinion, the United States District Court for the Northern District of California dismissed Kinderstart’s complaint, and granted leave to amend.

Kinderstart alleged a number of causes of action, including violation of the First Amendment right to free speech and unlawful monopolistic behavior in violation of the Sherman Act. The court held that Kinderstart failed to allege facts sufficient to entitle it to relief.

In dismissing the First Amendment claim, the court held that Google is not a state actor. Although the Ninth Circuit employs a number of tests to determine whether state action exists, Google did not meet any of those tests. Kinderstart did not show that Google performed a public function, nor did it show that Google was involved in any joint action with the government. The complaint did not sufficiently allege that Google was in any way compelled or coerced by the government, or that there was any nexus or entwinement between Google’s actions and the government’s actions. No facts in the complaint pointed to any “symbiotic relationship” – a necessary element in a special Ninth Circuit test for state action – between Google’s conduct and the financial success of any governmental entity.

The court also rejected Kinderstart’s First Amendment argument that by making the search engine “freely available to anyone with an Internet connection,” Google had created a private space dedicated to public use in which the alleged restrictions violated free speech. On this point, Kinderstart’s own allegations of Google’s vast monetization – to the tune of $3.1 billion in 2005 – contradicted assertions that the sole function of Google is to promote open and free communication.

Another of Kinderstart’s claims was that by blocking links to the Kinderstart site in its search results, Google had engaged in anticompetitive behavior that is prohibited under Section 2 of the Sherman Act (15 U.S.C. §2). To succeed on this claim, Kinderstart would have had to allege a specific intent on Google’s part to destroy competition, conduct directed toward accomplishing that purpose, a dangerous possibility of succeeding at destroying competition, and resulting antitrust injury.

The court held that Kinderstart failed to allege enough facts to support this claim. There was no sufficient allegation that Google had denied access to an essential facility or refused to deal. Kinderstart did not explain how Google’s alleged conduct demonstrated the required intent for a Sherman Act violation. Moreover, noting that there generally is “no duty to aid competitors,” the court concluded that Google’s alleged removal of a competing search engine from its results was merely legitimate competitive action.

Kinderstart.com, LLC v. Google, Inc., No. 06-2057, (N.D. Cal., July 17, 2006) (Not selected for official publication).