Lawsuit alleges the search giant entered into an illegal deal with Facebook.

Google will have to face the bulk of a multistate antitrust lawsuit that accuses the tech giant of reaching an illegal deal with online ad rival Facebook.

The lawsuit, filed in 2020 by a group of 16 states or territories led by Texas Attorney General Ken Paxton, alleges that Google entered into a secret agreement, codenamed Jedi Blue, with Facebook in 2018 that would allegedly give the social network an illegal advantage in the search giant’s online advertising auctions. Facebook is not a party to the lawsuit.

Google had sought dismissal of the lawsuit, arguing that the conduct the states described is legal. However, US District Judge P. Kevin Castel for Southern New York ruled Tuesday that lawsuit can proceed, although he did dismiss one claim that claimed the deal was an unlawful restraint of trade, saying “there is nothing inexplicable or suspicious” in what led the companies to enter into the agreement.

The original lawsuit accused Alphabet-owned Google of harming competitors by engaging in “false, deceptive, or misleading acts” while operating its online ad exchange. It also alleged that Facebook illegally teamed up with the search giant, one of it biggest competitors in digital advertising.

Google didn’t immediately respond to a request for comment.

Keyword: Google Must Face Most of Texas' Antitrust Lawsuit on Ads

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