Google AI Overview appearing for search for Digger reviews. Stories from The Guardian, Empire and Vocal cited.
A US judge has dismissed a lawsuit brought by Penske Media Corporation against Google over the loss of traffic and revenue as a result of AI Overviews.
US District Judge Amit Mehta found that no “formal bargain” had ever been struck between publishers and Google, which means they cannot prove a claim under antitrust law, specifically the Sherman Act.
In separate news, an antitrust lawsuit brought against Google’s adtech practices by publishers including the Daily Mail and Gannett has been allowed to proceed.
Penske, which publishes entertainment newsbrands including Variety, Hollywood Reporter and Rolling Stone, said search impressions and referrals to its content had declined since AI Overviews rolled out, and this had affected advertising, affiliate and subscription revenue.
In particular, it said, search traffic to content containing affiliate links had “dropped dramatically” resulting in a drop in organic affiliate revenue of more than a third from its peak to the end of 2024.
Penske also complained about the impact of being unable to block Google from using its content in AI Overviews while still appearing normally in search results , saying it would be “devastating” in revenue terms for it to lose its search visibility.
A similar case was brought by education resources company Chegg, whose arguments were also dismissed.
Judge Mehta acknowledged the harm caused to publishers when AI summaries result in people being less likely to click through to their websites and thus generate advertising revenue.
He said: “The court does not treat Plaintiffs’ alleged harms lightly. Nor is it unsympathetic to the situation publishers now find themselves in, and the knock-on consequences to journalists, educators, and other online creators whose content Google takes and repurposes without compensation.”
But he said the court was bound by the law as it is written, and the claims were not plausible as a result.
Judge Mehta said Penske and Chegg failed to show there was any actual agreement through which Google “promised to ‘sell’ Plaintiffs any specific amount of traffic – or any traffic whatsoever – in exchange for ‘buying’ their content”.
There was no communication between Google and the publishers “from which mutual assent to engage in a transaction could plausibly be inferred”.
Judge Mehta said: “Plaintiffs have pleaded only that they have an ‘expectation’ that Google will send them search traffic if they make their content available for free. But an expectation is not an agreement. It is simply how a general search engine works.”
Publishers ‘voluntarily acceded to cost-free crawling’ from Google, judge suggests
A similar case was dismissed earlier this year having been brought by local news publishers Helena World Chronicle LLC, the publisher of 155-year-old Arkansas newspaper Helena World and the digital-only Monroe County Argus, and Mississippi-based Emmerich Newspapers, which publishes 25 print newspapers and 22 websites.
Judge Mehta said in that case there was similarly no evidence of a written or oral commercial agreement between the publishers and Google “to supply news content in exchange for search traffic”.
Penske argued the court could find an “implied agreement” with Google based on the “historical course of dealing between the parties”.
But Judge Mehta said this “must at least plausibly supply the essential terms of the agreement, like the price or quantity of goods. Plaintiffs do not plead such essential elements. The closest they come is to allege that they ‘permit Google to access their content for an access price of zero.’
“But Plaintiffs do not claim that this term arose from a meeting of the minds with Google, as opposed to their voluntarily acceding to cost-free crawling. The latter circumstance is the more plausible.”
Judge Mehta added that publishers “keep their content open to crawling because doing so serves their own independent interest in search traffic, not because they struck any bargain with Google.
“Merely incanting the phrase ‘historical course of dealing’ cannot plausibly convert two parties’ independently self-interested conduct into a contract.”
Judge Mehta went on to call the publishers’ case “entirely implausible” because “if accepted, it would mean that Google contracts with every website that it indexes for Google Search. Google therefore would have agreements with billions of web content publishers.”
He added that “though it may be true that Google encourages publishers to create higher quality websites to drive traffic to their sites, Google makes no promise that traffic will follow or in what quantity. That higher-quality websites generally attract more traffic is not a function of contract; once more, it is simply how general search engines work.
“In any event, distinguishing between digital publishers that produce ‘quality’ content from those that do not is not an objective way to determine who has an ‘agreement’ with Google for purposes of the Sherman Act.”
‘Consumer indifference’ between Google search and AI Overviews
Penske also attempted to argue that Google was engaged in an unlawful tying arrangement because they had to remain opted into AI training for features like AI Overviews in order to stay sufficiently visible in the main search results.
But Judge Mehta found the publisher had not “plausibly alleged that general search and AI Overviews are separate products, as opposed to an integrated search experience”.
He said that if there was separate consumer demand for traditional search results, people would continue to scroll past AI summaries to get there. “But Plaintiffs allege just the opposite: that users are not scrolling past AI Overviews to get to the organic links. Instead, they contend, a user satisfied with the answer offered by AI Overviews would have ‘little reason’ to navigate to a different website, allowing Google to ‘cannibalise’ the traffic intended for the PMC Plaintiffs.
“These allegations suggest not separate consumer demands, but rather a general demand for information and consumer indifference as to how they obtain it. Or put differently, the more plausible inference is that Google Search and AI Overviews have the same use case: providing answers to users’ search queries.”
Google is now rolling out a feature in its Search Console which will allow publishers to opt out of their content appearing in AI Overviews and other AI features, after the UK’s Competition and Markets Authority ordered it to make this choice available.
Google is also reportedly trialling a programme through which it is paying publishers when their content makes a “significant” contribution to its AI features.
‘Someone with authority has to address what is happening’
Jason Kint, chief executive of Digital Content Next which represents online publishers in the US, said in response: “Strip away all of the legal technicalities and antitrust mumbo jumbo and the real-world problem is still crystal clear. Google has an adjudicated illegal monopoly in search and is now swallowing up all of the journalism of humanity to power its AI products, while sending less and less traffic and value back to the publishers who create it. Judge Mehta himself continues to recognise that harm to publishers and journalists whose content Google ‘takes and repurposes without compensation.’
“Publishers raised this harm in US vs Google, and when it wasn’t addressed there, they brought it directly to the courts. Now that path has been dismissed, too.
“At some point, someone with authority has to address what is happening in the real world: Google is using its dominance to fundamentally undermine the open web and the economics of original journalism.”
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