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Apple, Google and a Deal That Controls the Internet

OAKLAND, Calif. — When Tim Cook and Sundar Pichai, the chief executives of Apple and Google, were photographed eating dinner together in 2017 at an upscale Vietnamese restaurant called Tamarine, the picture set off a tabloid-worthy frenzy about the relationship between the two most powerful companies in Silicon Valley.

As the two men sipped red wine at a window table inside the restaurant in Palo Alto, their companies were in tense negotiations to renew one of the most lucrative business deals in history: an agreement to feature Google’s search engine as the preselected choice on Apple’s iPhone and other devices. The updated deal was worth billions of dollars to both companies and cemented their status at the top of the tech industry’s pecking order.

Now, the partnership is in jeopardy. Last Tuesday, the Justice Department filed a landmark lawsuit against Google — the U.S. government’s biggest antitrust case in two decades — and homed in on the alliance as a prime example of what prosecutors say are the company’s illegal tactics to protect its monopoly and choke off competition in web search.

The scrutiny of the pact, which was first inked 15 years ago and has rarely been discussed by either company, has highlighted the special relationship between Silicon Valley’s two most valuable companies — an unlikely union of rivals that regulators say is unfairly preventing smaller companies from flourishing.

“We have this sort of strange term in Silicon Valley: co-opetition,” said Bruce Sewell, Apple’s general counsel from 2009 to 2017. “You have brutal competition, but at the same time, you have necessary cooperation.”

Apple and Google are joined at the hip even though Mr. Cook has said internet advertising, Google’s bread and butter, engages in “surveillance” of consumers and even though Steve Jobs, Apple’s co-founder, once promised “thermonuclear war” on his Silicon Valley neighbor when he learned it was working on a rival to the iPhone.

Apple and Google’s parent company, Alphabet, worth more than $3 trillion combined, do compete on plenty of fronts, like smartphones, digital maps and laptops. But they also know how to make nice when it suits their interests. And few deals have been nicer to both sides of the table than the iPhone search deal.

Nearly half of Google’s search traffic now comes from Apple devices, according to the Justice Department, and the prospect of losing the Apple deal has been described as a “code red” scenario inside the company. When iPhone users search on Google, they see the search ads that drive Google’s business. They can also find their way to other Google products, like YouTube.

A former Google executive, who asked not to be identified because he was not permitted to talk about the deal, said the prospect of losing Apple’s traffic was “terrifying” to the company.

The Justice Department, which is asking for a court injunction preventing Google from entering into deals like the one it made with Apple, argues that the arrangement has unfairly helped make Google, which handles 92 percent of the world’s internet searches, the center of consumers’ online lives.

Online businesses like Yelp and Expedia, as well as companies ranging from noodle shops to news organizations, often complain that Google’s search domination enables it to charge advertising fees when people simply look up their names, as well as to steer consumers toward its own products, like Google Maps. Microsoft, which had its own antitrust battle two decades ago, has told British regulators that if it were the default option on iPhones and iPads, it would make more advertising money for every search on its rival search engine, Bing.

What’s more, competitors like DuckDuckGo, a small search engine that sells itself as a privacy-focused alternative to Google, could never match Google’s tab with Apple.

Apple now receives an estimated $8 billion to $12 billion in annual payments — up from $1 billion a year in 2014 — in exchange for building Google’s search engine into its products. It is probably the single biggest payment that Google makes to anyone and accounts for 14 to 21 percent of Apple’s annual profits. That’s not money Apple would be eager to walk away from.

In fact, Mr. Cook and Mr. Pichai met again in 2018 to discuss how they could increase revenue from search. After the meeting, a senior Apple employee wrote to a Google counterpart that “our vision is that we work as if we are one company,” according to the Justice Department’s complaint.

A forced breakup could mean the loss of easy money to Apple. But it would be a more significant threat to Google, which would have no obvious way to replace the lost traffic. It could also push Apple to acquire or build its own search engine. Within Google, people believe that Apple is one of the few companies in the world that could offer a formidable alternative, according to one former executive. Google has also worried that without the agreement, Apple could make it more difficult for iPhone users to get to the Google search engine.

A spokesman for Apple declined to comment on the partnership, while a Google spokesman pointed to a blog post in which the company defended the relationship.

Even though its bill with Apple keeps going up, Google has said again and again that it dominates internet search because consumers prefer it, not because it is buying customers. The company argues that the Justice Department is painting an incomplete picture; its partnership with Apple, it says, is no different than Coca-Cola paying a supermarket for prominent shelf space.

Other search engines like Microsoft’s Bing also have revenue-sharing agreements with Apple to appear as secondary search options on iPhones, Google says in its defense. It adds that Apple allows people to change their default search engine from Google — though few probably do because people typically don’t tinker with such settings and many prefer Google anyway.

Apple has rarely, if ever, publicly acknowledged its deal with Google, and according to Bernstein Research, has mentioned its so-called licensing revenue in an earnings call for the first time this year.

According to a former senior executive who spoke on the condition of anonymity because of confidentiality contracts, Apple’s leaders have made the same calculation about Google as much of the general public: The utility of its search engine is worth the cost of its invasive practices.

“Their search engine is the best,” Mr. Cook said when asked by Axios in late 2018 why he partnered with a company he also implicitly criticized. He added that Apple had also created ways to blunt Google’s collection of data, such as a private-browsing mode on Apple’s internet browser.

The deal is not limited to searches in Apple’s Safari browser; it extends to virtually all searches done on Apple devices, including with Apple’s virtual assistant, Siri, and on Google’s iPhone app and Chrome browser.

The relationship between the companies has swung from friendly to contentious to today’s “co-opetition.” In the early years of Google, the company’s co-founders, Larry Page and Sergey Brin, saw Mr. Jobs as a mentor, and they would take long walks with him to discuss the future of technology.

In 2005, Apple and Google inked what at the time seemed like a modest deal: Google would be the default search engine on Apple’s Safari browser on Mac computers.

Quickly, Mr. Cook, then still a deputy to Mr. Jobs, saw the arrangement’s lucrative potential, according to another former senior Apple executive who asked not to be named. Google’s payments were pure profit, and all Apple had to do was feature a search engine its users already wanted.

Apple expanded the deal for its big upcoming product: the iPhone. When Mr. Jobs unveiled the iPhone in 2007, he invited Eric Schmidt, Google’s then chief executive, to join him onstage for the first of Apple’s many famous iPhone events.

“If we just sort of merged the two companies, we could just call them AppleGoo,” joked Mr. Schmidt, who was also on Apple’s board of directors. With Google search on the iPhone, he added, “you can actually merge without merging.”

Then the relationship soured. Google had quietly been developing a competitor to the iPhone: smartphone software called Android that any phone maker could use. Mr. Jobs was furious. In 2010, Apple sued a phone maker that used Android. “I’m going to destroy Android,” Mr. Jobs told his biographer, Walter Isaacson. “I will spend my last dying breath if I need to.”

A year later, Apple introduced Siri. Instead of Google underpinning the virtual assistant, it was Microsoft’s Bing.

Yet the companies’ partnership on iPhones continued — too lucrative for either side to blow it up. Apple had arranged the deal to require periodic renegotiations, according to a former senior executive, and each time, it extracted more money from Google.

“You have to be able to maintain those relationships and not burn a bridge,” said Mr. Sewell, Apple’s former general counsel, who declined to discuss specifics of the deal. “At the same time, when you’re negotiating on behalf of your company and you’re trying to get the best deal, then, you know, the gloves come off.”

Around 2017, the deal was up for renewal. Google was facing a squeeze, with clicks on its mobile ads not growing fast enough. Apple was not satisfied with Bing’s performance for Siri. And Mr. Cook had just announced that Apple aimed to double its services revenue to $50 billion by 2020, an ambitious goal that would be possible only with Google’s payments.

By the fall of 2017, Apple announced that Google was now helping Siri answer questions, and Google disclosed that its payments for search traffic had jumped. The company offered an anodyne explanation to part of the reason it was suddenly paying some unnamed company hundreds of millions of dollars more: “changes in partner agreements.”

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Goldman Sachs Unit Pleads Guilty Over Fraud Scheme

Goldman Sachs admitted its Malaysian subsidiary “knowingly and willingly” conspired to violate the Foreign Corrupt Practices Act because some former employees paid bribes to officials in connection with the looting of a sovereign wealth fund, a scandal that toppled that country’s leader and triggered criminal cases that spanned the globe.

The subsidiary pleaded guilty to a conspiracy charge on Thursday in Brooklyn federal court, and the bank itself entered into a three-year deferred prosecution agreement to resolve one of the biggest scandals in the Wall Street giant’s long history.

Separate from the penalties the bank will pay, the board of Goldman Sachs said it was taking steps to withhold or recoup $174 million in compensation from current and former executives — including its chief executive, David Solomon, and his predecessor, Lloyd Blankfein — either in lost pay or the return of money already paid.

In a statement, Mr. Solomon said Goldman “fell short” in overseeing its employees.

“While it is abundantly clear that certain former employees broke the law, lied to our colleagues and circumvented firm controls, this fact does not relieve me or anyone else at the firm of our responsibility to recognize two critical realities,” Mr. Solomon said.

Mr. Blankfein, reached by phone, declined to comment.

All told, Goldman will pay billions in penalties and disgorgement in Malaysia, the United States and Hong Kong for its role in the looting of the 1Malaysia Development Berhad fund. The scandal ultimately brought down the government of Malaysia’s prime minister at the time, Najib Razak, and turned a financier with expensive tastes named Jho Low into an international fugitive.

As part of the plea deal, Goldman has agreed to a statement of facts compiled by federal authorities that it will not be able to dispute. That document outlines a number of internal control failings at Goldman that authorities said should have detected the wrongdoing by its former employees, as well as the involvement of Mr. Low in helping to arrange the deals and pay more than $1 billion in bribes to official in Malaysia.

“Other personnel at the bank allowed this scheme to proceed by overlooking or ignoring a number of clear red flags,” said Brian C. Rabbitt, acting assistant attorney general for the Justice Department’s criminal division, said during a news conference.

More than $2.7 billion raised for the fund in bond offerings arranged by Goldman financed lavish lifestyles for powerful Malaysians, including friends and family of Mr. Najib. The money bought paintings by van Gogh and Monet, a mega-yacht docked in Bali, a grand piano made of clear acrylic that was given to a supermodel as a gift, and a king’s ransom in jewelry. Pilfered money also financed a boutique hotel in Beverly Hills, a share of the EMI music publishing portfolio and the Hollywood movie “The Wolf of Wall Street.”

Goldman Sachs earned $600 million in fees to arrange the bond sales.

Federal prosecutors had already brought charges against two Goldman bankers and Mr. Low, who is believed to be living in China. One of the bankers, Tim Leissner, the husband of the fashion designer and model Kimora Lee Simmons, has pleaded guilty and agreed to forfeit up to $43.7 million.

Malaysian prosecutors also brought criminal charges against Goldman and more than a dozen executives, but the bank agreed in July to pay $2.5 billion to resolve that investigation. Goldman also pledged to cover any shortfall from the sale of $1.4 billion in assets that have been seized by prosecutors in the United States and Malaysia.

Much of the property seized belonged to Mr. Low, who has never appeared in court to face charges in the case. He has denied wrongdoing through representatives in the United States, but agreed last year to give up all claims to seized assets worth as much as $900 million.

While the legal saga is essentially over for Goldman, it will continue for some individuals: Mr. Leissner still awaits sentencing, and the other banker charged in the United States, Roger Ng, has pleaded not guilty and awaits trial. Another former Goldman executive, Andrea Vella, has been barred from the financial industry by the Federal Reserve. (Goldman’s board said it was taking steps to recoup tens of millions of dollars in compensation from them as well.)

In Malaysia, Mr. Najib was convicted last July in a corruption case and sentenced to up to 12 years in prison, but the sentence was stayed on appeal.

Mr. Low’s exact whereabouts remain a mystery.

This is a developing story. Check back for updates.

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Forget Antitrust Laws. To Limit Tech, Some Say a New Regulator Is Needed.

For decades, America’s antitrust laws — originally designed to curb the power of 19th-century corporate giants in railroads, oil and steel — have been hailed as “the Magna Carta of free enterprise” and have proved remarkably durable and adaptable.

But even as the Justice Department filed an antitrust suit against Google on Tuesday for unlawfully maintaining a monopoly in search and search advertising, a growing number of legal experts and economists have started questioning whether traditional antitrust is up to the task of addressing the competitive concerns raised by today’s digital behemoths. Further help, they said, is needed.

Antitrust cases typically proceed at the stately pace of the courts, with trials and appeals that can drag on for years. Those delays, the legal experts and economists said, would give Google, Facebook, Amazon and Apple a free hand to become even more entrenched in the markets they dominate.

A more rapid-response approach is required, they said. One solution: a specialist regulator that would focus on the major tech companies. It would establish and enforce a set of basic rules of conduct, which would include not allowing the companies to favor their own services, exclude competitors or acquire emerging rivals and require them to permit competitors access to their platforms and data on reasonable terms.

The British government has already said it would create a digital markets unit, with calls for a Big Tech regulator to also be introduced in the European Union and in Australia. In the United States, recommendations for a digital markets regulator have also been made in expert reports and in congressional testimony. It could be a separate agency or perhaps a digital division inside the Federal Trade Commission.

Significantly, the leading proponents of this path in the United States are mainstream antitrust experts and economists rather than break-’em-up firebrands. Jason Furman, a professor at Harvard University and chair of the Council of Economic Advisers in the Obama administration, led an advisory group to the British government that recommended the creation of a digital markets unit in 2019.

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Credit…Zach Gibson/Getty Images

Breaking up the big tech companies, Mr. Furman said, is a bad idea because that would risk losing some of the consumer benefits these digital utilities undeniably deliver. A regulator is necessary to police digital markets and the behavior of the tech giants, he said.

“I’m a small ‘c’ conservative, and I’m not a fan of regulation generally,” Mr. Furman said. “But it’s needed in this space.”

Regulators that focus on specific sectors of the economy are common in the United States. For financial markets, there is the Securities and Exchange Commission; for airlines, the Federal Aviation Administration; for pharmaceuticals, the Food and Drug Administration; for telecommunications, the Federal Communications Commission; and so on.

There is also precedent for picking out a handful of big companies for special treatment. In banking, the biggest banks with the most customers and loans are classified as “systemically important financial institutions” and subject to more stringent scrutiny.

Several supporters of a new tech regulator were officials in the Obama administration, which was known for being friendly to Silicon Valley. But the advocates said that experience — as well as the conservative, pro-big business drift of court rulings in recent years — left them frustrated with antitrust law as the only way to restrain the growing market power and conduct of the big tech companies.

“The mechanism of antitrust is not working to protect competition,” said Fiona Scott Morton, an official in the Justice Department’s antitrust division in the Obama administration, who is an economist at the Yale University School of Management. “So let’s do something else — use a different tool.”

Ms. Scott Morton led an expert panel on antitrust in a report last year on digital platforms by the Stigler Center at the University of Chicago’s Booth School of Business. The report recommended the creation of a regulatory authority. (Ms. Scott Morton has been a forceful critic of Google, but also a consultant to Apple and Amazon.)

Such a regulatory approach carries the risk of government’s meddling in a fast-moving industry that could hobble innovation, some antitrust experts warned. While antitrust law reacts to alleged anticompetitive behavior and can thus be slow, that shortcoming is preferable to prescriptive government rules and regulations, they said.

“I’m very uncomfortable with the regulatory path, especially if it means things like getting government approval for product changes,” said Herbert Hovenkamp, a professor at the University of Pennsylvania Law School. “The history of regulation shows that it is an innovation killer.”

A. Douglas Melamed, a former general counsel of Intel and a former antitrust official in the Justice Department, shared that concern. But Mr. Melamed, a member of the expert panel for the Stigler Center report, said the tech giants did pose a competition problem.

“I think regulation might make sense if it is narrowly focused, not running the industry,” said Mr. Melamed, who is a professor at Stanford Law School.

The last major antitrust action against a big technology company was the landmark Microsoft case in the 1990s. The case began with a suit filed in 1994 by the Federal Trade Commission and a simultaneous consent decree.

The Justice Department and several states later picked up the pursuit, investigated anew, filed suit and conducted an exhaustive trial. Microsoft was found to have repeatedly violated the nation’s antitrust laws, and the company then reached a settlement with the government, which a federal court approved in 2002.

In the Microsoft case, the antitrust legal process worked, in its way. Yet its impact is still debated. Without the suit and years of scrutiny, some observers said, Microsoft could have throttled the rise of Google.

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Credit…Stephen Crowley/The New York Times

But others said the technological shift toward the internet and away from the personal computer meant that Microsoft had lost the gatekeeper power it once held. Technology, not antitrust, they insisted, opened the door to competition.

Triumph or not, the Microsoft case was two decades ago. Proponents of a new regulator said antitrust law was ill suited by itself to restraining today’s faster-moving digital giants. In the internet economy, they said, the forces that reinforce and expand the power of a market leader — called network effects — are stronger and more rapid than in the personal computer era.

“Antitrust is not a fully adequate tool to deal with the companies that dominate these markets,” said Gene Kimmelman, who was on the Stigler Center panel and a co-author of a recent report by the Shorenstein Center at Harvard that called for the creation of a “digital platform agency” in America.

Another argument for the regulatory option is that competition concerns now span four companies, not just one. Apple, Amazon, Facebook and Google are in different markets, including search, online advertising, e-commerce and social networks. Bringing separate antitrust cases against them would most likely be beyond the resources of the government.

“When the competition issues are larger than a single firm, regulation might be the better tool to use,” said Andrew I. Gavil, a law professor at Howard University.

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Purdue Pharma Pleads Guilty to Criminal Charges for Opioid Sales

Purdue Pharma, the maker of OxyContin, has agreed to plead guilty to criminal charges related to its marketing of the addictive painkiller, and faces penalties of roughly $8.3 billion, the Justice Department announced on Wednesday. The settlement could pave the way for a resolution of thousands of lawsuits brought against the company for its role in a public health crisis that has killed more than 450,000 Americans since 1999.

The company’s owners, members of the wealthy Sackler family, have agreed to pay $225 million in civil penalties. Prosecutors said the agreement did not preclude the filing of criminal charges against Purdue executives or individual Sacklers.

The federal settlement does not end all of the extensive litigation against Purdue, but it does represent a significant advance in the long legal march by states, tribes, cities and counties to hold the most prominent opioid maker accountable.

In a statement issued after the announcement of the deal, Steve Miller, chairman of the company board, said: “Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts.”

Members of the Sackler family said in a statement that they “acted ethically and lawfully.” Issued on behalf of members who had served on the company’s board, the family statement added: “The board relied on repeated and consistent assurances from Purdue’s management team that the company was meeting all legal requirements.”

OxyContin, which came on the market in the mid-90s, is seen as an early, ferocious driver of the opioid epidemic and Purdue is regarded as the architect of muscular, misleading drug marketing. But it is unlikely the company will pay anything close to the $8.3 billion negotiated in the settlement deal. That is because Purdue sought bankruptcy court protection amid the onslaught of lawsuits, and so the federal government will now have to take its place in a long line of creditors. Typically, creditors end up collecting pennies on the dollar in bankruptcy proceedings.

The settlement does give the Justice Department and the Trump administration a high-profile achievement that the president can tout on the campaign trail. Mr. Trump won the 2016 election in part because he vowed to combat an opioid addiction crisis that had gripped large swaths of the country and continues to be an issue in important swing states.

But state attorneys general from Massachusetts, New York and North Carolina, among others, have raised questions about just how much of an effect the settlement will have with respect to holding the Sackler family to account. Purdue was keen to settle its federal legal troubles under a Trump administration, which it sensed would cut a better deal than a new Biden administration. The $225 million that the Sacklers would pay as part of their civil settlements is small relative to the family’s net worth, estimated to be at least $13 billion, much of it generated from sales of OxyContin.

Joe Rice, a negotiator for local governments that are suing Purdue, said, “Purdue is doing everything they can to get this deal done in this administration. It’s advantageous to both sides.”

This federal case against Purdue is distinct from thousands of opioid-related lawsuits against other drug manufacturers, as well as distributors and pharmacy chains, still pending in federal and state courts.

Purdue has long demanded that the federal charges against it be resolved before it would agree to a larger settlement with cities, tribes, states and individuals, who claim that its relentless marketing of OxyContin directly contributed to a crisis of addiction and overdoses, resulting in towering costs in health care, law enforcement and unemployment. Lawyers close to negotiations expect that the final settlement may emerge early next year.

In the federal settlement, the company agreed to plead guilty to felony charges of defrauding federal health agencies and violating anti-kickback laws. The penalties include $3.54 billion in criminal fines and $2 billion in criminal forfeiture of profits, the largest penalties ever levied against a pharmaceutical manufacturer. The company pleaded guilty to marketing opioids to more than 100 doctors that it suspected of writing illegal prescriptions and lying about this to the federal Drug Enforcement Administration.

Purdue also pleaded guilty to paying illegal kickbacks to doctors and to an electronic health records company, Practice Fusion. In January Practice Fusion paid $145 million in fines for taking kickbacks from drug manufacturers in exchange for embedding pop-up alerts to physicians, intended to boost opioid prescriptions.

The Purdue settlement also includes $2.8 billion in civil penalties, related to allegations that the company violated the False Claims Act by using aggressive marketing tactics to convince doctors to unnecessarily prescribe opioids — frivolous prescriptions that experts say helped fuel a drug addiction crisis that has ravaged America for decades. Those prescriptions were often paid for by federal health care programs like Medicare and Medicaid.

Mr. Miller, the Purdue chairman, said that the resolution of the Justice Department’s charges was an essential step in the company’s bankruptcy restructuring. “Purdue today is a very different company,” he added. “We have made significant changes to our leadership, operations, governance and oversight.”

This is the first time since 2007 that Purdue has pleaded guilty to federal criminal charges for misleading doctors, patients and the government about its drug. At the time, the company paid $600 million in fines.

To resolve thousands of local lawsuits, Purdue has proposed a global settlement that it values at about $10 billion. That figure includes future profits from drugs still in development as well as a $3 billion contribution from the Sacklers, which is separate from the $225 million the family has agreed to pay the federal government.

A year ago, under the weight of opioid litigation, Purdue filed for bankruptcy, and it is expected to emerge at some point as a new company. At least two other opioid manufacturers, Insys Therapeutics and Mallinckrodt, have also sought bankruptcy protection because of litigation.

Judge Robert D. Drain, who is overseeing the Purdue bankruptcy case in White Plains, N.Y., will have to approve the terms of the federal settlement and will review the billions of dollars in federal penalties alongside a long line of unsecured creditors. When the bankruptcy is finalized, Purdue said in the federal agreement, it would post documents related to the prosecutions on a public website.

But one bucket of sanctions, the $2 billion in criminal forfeiture of profits, is more likely to be paid in full. The Justice Department said on Wednesday that it would require that Purdue directly pay the U.S. Treasury just $225 million, but would earmark the remaining $1.775 billion for municipalities, states and tribes, on condition that they allocate the money to abate local opioid crises.

A second condition of the settlement has prompted an outcry from some two dozen state attorneys general: the ownership of Purdue, after it emerges from bankruptcy.

Purdue has proposed that the company be run as a “public benefit corporation,” with proceeds from continuing limited sales of OxyContin and several overdose-reversing medications under development to go toward opioid abatement. The Justice Department endorses that model.

But in a forceful letter addressed to Attorney General William P. Barr earlier this month, the state attorneys general decried the public trust model. Governments should not be in the opioid business, they said. Instead, they argued that Purdue should be run privately, with government oversight.

Another objection to the new settlement centers on the resolution of civil claims against individual Sacklers, raised by private families who are suing. A forensic audit last year by Purdue found that the Sacklers directed at least $10.7 billion in the company’s proceeds to family-controlled trusts and holding companies, even as Purdue was facing legal scrutiny. Much of those proceeds, the Sacklers have said, went toward tax payments.

In a letter to Mr. Barr, a coalition of relatives of opioid victims said the agreement was premature and too little.

Massachusetts, for example, has scheduled depositions against some Sacklers in November, during which more information may come to light.

“The D.O.J. failed,” said Maura Healey, the Massachusetts attorney general. “Justice in this case requires exposing the truth and holding the perpetrators accountable, not rushing a settlement to beat an election. I am not done with Purdue and the Sacklers, and I will never sell out the families who have been calling for justice for so long.”

During a news briefing on the federal settlement, Deputy Attorney General Jeffrey A. Rosen pushed back on critics who said that the deal was not tough enough on Purdue and the Sackler family. He said that the department had taken “very substantial” and “very significant” punitive action against Purdue, which pleaded guilty to three criminal charges, and he noted that the family would turn over ownership of the company.

A contentious issue with respect to the Sacklers is that the family itself is not seeking bankruptcy protection and has been seeking release from litigation as a condition of settling the Purdue claims.

Mr. Rice, the negotiator for thousands of local governments, favors the broad contours of a public benefit trust. “You have to figure out what you do with the limited need there may be for some opioids. You don’t maximize the value of the Purdue asset if you destroy the product totally,” he said. “And you want to make sure that the people who abused the right to sell narcotics pay for what they did. The Sacklers lose their name, their company and substantially more.”

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Google Antitrust Fight Thrusts Low-Key C.E.O. Into the Line of Fire

OAKLAND, Calif. — When Sundar Pichai succeeded Larry Page as the head of Google’s parent company in December, he was handed a bag of problems: Shareholders had sued the company, Alphabet, over big financial packages handed to executives accused of misconduct. An admired office culture was fraying. Most of all, antitrust regulators were circling.

On Tuesday, the Justice Department accused Google of being “a monopoly gatekeeper of the internet,” one that uses anticompetitive tactics to protect and strengthen its dominant hold over web search and search advertising.

Google, which has generated vast profits through a recession, a pandemic and earlier investigations by government regulators on five continents, now faces the first truly existential crisis in its 22-year history.

The company’s founders, Mr. Page and Sergey Brin, have left the defense to the soft-spoken Mr. Pichai, who has worked his way up the ranks over 16 years with a reputation for being a conscientious caretaker rather than an impassioned entrepreneur.

Mr. Pichai, a former product manager, may seem an unlikely candidate to lead his company’s fight with the federal government. But if the tech industry’s bumptious history with antitrust enforcement is any lesson, a caretaker who has reluctantly stepped into the spotlight might be preferable to a charismatic leader born to it.

Mr. Pichai, 48, is expected to make the case — as he has for some time — that the company is not a monopoly even though it has a 92 percent global market share of internet searches. Google is good for the country, so goes the corporate message, and has been a humble economic engine — not a predatory job killer.

“He has to come off as an individual who is trying to do the right thing not only for his company but broader society,” said Paul Vaaler, a business and law professor at the University of Minnesota. “If he comes off as evasive, petulant and a smart aleck, this is going to be a killer in front of the court and the court of public opinion.”

Google declined to make Mr. Pichai available for an interview. In an email to employees on Tuesday, he urged Google employees to stay focused on their work so that users will continue to use its products not because they have to but because they want to.

“Scrutiny is nothing new for Google, and we look forward to presenting our case,” Mr. Pichai wrote. “I’ve had Googlers ask me how they can help, and my answer is simple: Keep doing what you’re doing.”

Few executives have faced a challenge like this, and the most iconic figures in the technology industry have wilted under the glare of antitrust scrutiny.

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Credit…Stephen Crowley/The New York Times

Bill Gates, who was chief executive of Microsoft in the last big technology antitrust case brought by the Justice Department two decades ago, came across as combative and evasive in depositions, reinforcing the view that the company was a win-at-all-costs bully. Mr. Gates said last year that the lawsuit had been such a “distraction” that he “screwed up” the transition to mobile phone software and ceded the market to Google.

Mr. Page dealt with impending antitrust scrutiny with detachment, spending his time on futuristic technology projects instead of huddling with lawyers. Even as the European Union handed down three fines against Google for anticompetitive practices, Mr. Page barely addressed the matter publicly.

On a conference call with reporters on Tuesday, officials at the Justice Department declined to reveal whether they had spoken to Mr. Page during its investigation.

In its complaint, the Justice Department, along with 11 states, said Google had foreclosed competition in the search market by striking deals with handset manufacturers, including Apple, and mobile carriers to block rivals from competing effectively.

“For the sake of American consumers, advertisers and all companies now reliant on the internet economy, the time has come to stop Google’s anticompetitive conduct and restore competition,” the complaint said.

Google said that the case was “deeply flawed” and that the Justice Department was relying on “dubious antitrust arguments.”

Google is also the target of an antitrust inquiry by state attorneys general looking into its advertising technology and web search. And Europe continues to investigate the company over its data collection even after the three fines since 2017, totaling nearly $10 billion.

At Mr. Pichai’s side are senior executives who are also inclined to strike an accommodating tone. He has surrounded himself with other serious, buttoned-up career Google managers who bring a lot of boring to the table.

The point person for handling the case is Kent Walker, Google’s chief legal officer and head of global affairs. Though Mr. Walker, who worked at the Justice Department as an assistant U.S. attorney and joined Google in 2006, oversees many of the company’s messiest issues, he rarely makes headlines — a testament, current and former colleagues said, to his lawyerly pragmatism.

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Credit…Jim Wilson/The New York Times

Google has appointed Halimah DeLaine Prado as its new general counsel. A 14-year veteran of the company’s legal department, Ms. Prado was most recently a vice president overseeing the global team that advised Google on products including advertising, cloud computing, search, YouTube and hardware. While Ms. Prado doesn’t have a background in antitrust, she has been at Google since 2006 and is, by now, well versed in competition law.

The company is expected to rely heavily on its high-priced law firms to help manage the battle, including Wilson Sonsini Goodrich & Rosati, a top Silicon Valley firm, and Williams & Connolly, which has defended Google in other competition law cases.

Wilson Sonsini has represented Google from the company’s inception and helped it defend itself in a Federal Trade Commission investigation into its search business. In 2013, the agency chose not to bring charges.

Regardless of the legal argument for prosecuting Google as a monopoly, the case may shape the public perception of the company long after it has been resolved.

Until now, Google’s public posture has been a shrug. Mr. Pichai has said that the antitrust scrutiny is nothing new and that, if anything, the company welcomes the look into its business practices. Google has argued that it competes in rapidly changing markets, and that its dominance can evaporate quickly with the emergence of new rivals.

“Google operates in highly competitive and dynamic global markets, in which prices are free or falling and products are constantly improving,” Mr. Pichai said in his opening remarks to a House antitrust panel in July. “Google’s continued success is not guaranteed.”

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Credit…Pool photo by Graeme Jennings

Mr. Pichai is familiar with the machinations of antitrust proceedings. In 2009, when he was a vice president of product management, he lobbied the European competition authorities to take action on Microsoft’s Internet Explorer web browser.

“We are confident that more competition in this space will mean greater innovation on the web and a better user experience for people everywhere,” Mr. Pichai wrote in a blog post at the time, sentiments that search rivals say about Google today.

But shortly after he became Google’s chief executive in 2015, Mr. Pichai displayed his tendency for pragmatism when he buried the hatchet with Microsoft. The two companies agreed to stop complaining to regulators about each other.

Early in his tenure running Google, Mr. Pichai was reluctant to press its case in Washington — a job that one of his predecessors, Eric Schmidt, had reveled in. Mr. Schmidt, a big donor in Democratic politics, was a frequent visitor to the White House during the Obama presidency and served on the President’s Council of Advisors on Science and Technology.

In 2018, Google declined to send Mr. Pichai to testify at a Senate Intelligence Committee hearing on Russian interference in the 2016 presidential election. Annoyed senators left an empty seat for the company’s representative next to executives from Facebook and Twitter. (Mr. Page was also invited to testify, but there was never any expectation from people within the company that he would.)

Since then, Mr. Pichai has made frequent trips to Washington, testified at other congressional hearings and held meetings with President Trump.

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Credit…Tom Brenner for The New York Times

Microsoft’s long battle with the government has also influenced how Google plans to wage its antitrust fight. Many Google executives believe Microsoft was too combative with the Justice Department, bringing the company to a standstill.

For most of the last decade, even as Google has dealt with antitrust investigations in the United States and Europe, the company has continued expanding into new businesses and acquire companies, such as the fitness tracker maker Fitbit last year.

Now the bill for that growth may have come due. And like it or not, it has been left to Mr. Pichai. Mr. Page, who is a year younger than Mr. Pichai and who Forbes says is worth $65 billion, is pursuing other interests.

Mr. Pichai “hasn’t had to deal with anything of this magnitude,” said Michael Cusumano, a professor and deputy dean at the Massachusetts Institute of Technology’s Sloan School of Management. “He has to face the government. He has no choice.”

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Goldman Sachs Is Said to Admit Mistakes in 1MDB Scandal

An Asian subsidiary of Goldman Sachs will plead guilty to charges in the United States to resolve a foreign corruption and bribery case over the looting of billions of dollars from a Malaysian sovereign wealth fund, according to a person familiar with the agreement.

The Wall Street bank’s parent company will admit mistakes, the person said, but will not itself have to enter a guilty plea as part of the deal with federal prosecutors. The bank will also avoid the appointment of an outside monitor to review its compliance procedures.

The settlement, which also requires the bank to pay more than $2 billion in penalties to the Justice Department and U.S. securities and banking regulators, is scheduled to be formally announced on Thursday morning, according to two people briefed on the plans.

The agreement — negotiated over nearly two years with federal prosecutors in Brooklyn and the kleptocracy division of the Justice Department — ends an investigation into one of the worst scandals in the bank’s long history. But it is a black eye for Goldman, which has never before had to plead guilty in a federal investigation. And a statement of facts to be released with the settlement will put the bank in a poor light, according to two people familiar with the document.

A bank spokeswoman declined to comment. The terms of the guilty plea were first reported by The Wall Street Journal.

The scandal centered on the 1Malaysia Development Berhad fund, known as 1MDB, and spanned the globe. It brought down the government of Malaysia’s prime minister at the time, Najib Razak, and turned a financier with expensive tastes named Jho Low into an international fugitive.

More than $2.7 billion raised for the fund in bond offerings arranged by Goldman financed lavish lifestyles for powerful Malaysians, including friends and family of Mr. Najib. The money bought paintings by van Gogh and Monet, a mega-yacht docked in Bali, a grand piano made of clear acrylic that was given to a supermodel as a gift, and a king’s ransom in jewelry. Pilfered money also financed a boutique hotel in Beverly Hills, a share of the EMI music publishing portfolio and the Hollywood movie “The Wolf of Wall Street.”

All that and more were paid for with money raised by Goldman Sachs, which earned $600 million in fees to arrange the bond sales.

The fraud prompted criminal investigations in Malaysia and the United States.

Federal prosecutors brought charges against two Goldman bankers and Mr. Low, who is believed to be living in China. One of the bankers — Tim Leissner, the husband of the fashion designer and model Kimora Lee Simmons — has pleaded guilty.

In Malaysia, Mr. Najib was ousted as prime minister and charged with corruption. He was convicted last July and sentenced to up to 12 years in prison and fined nearly $50 million, but the sentence was stayed on appeal.

Malaysian prosecutors also brought criminal charges against Goldman and more than a dozen executives. In July, Goldman agreed to pay $2.5 billion to resolve that investigation. Goldman also pledged to cover any shortfall from the sale of $1.4 billion in assets that have been seized by prosecutors in the United States and Malaysia.

Earlier this year, Goldman lobbied the Justice Department seeking to limit the penalties it would face in the United States. The bank asked prosecutors in Washington to consider the amount it would pay to Malaysia when calculating its domestic penalties and sought to avoid a guilty plea by the subsidiary.

All told, the fines and restitution Goldman will pay over 1MDB are more than the $5 billion it paid in 2016 in a civil settlement over its role in marketing and selling faulty mortgage securities to investors in the run-up to the 2008 financial crisis.

A guilty plea by the bank itself could have caused complications for some of its businesses, but that outcome had not been seriously under consideration for months. The ramifications of a subsidiary guilty plea are less serious: In the past, the Securities and Exchange Commission has issued waivers allowing banks in similar situations to operate as normal. And the Department of Labor can grant a waiver to allow a bank to continue as a fiduciary for employee pension and retirement plans.

Goldman has long blamed rogue employees, including Mr. Leissner, a former top partner in Asia that the bank has said acted without approval. He pleaded guilty in 2018, saying that he and others at Goldman had conspired to circumvent the bank’s internal controls, allowing them to work with Mr. Low to bribe Malaysian officials and secure the bond deal.

As part of his plea, Mr. Leissner agreed to forfeit up to $43.7 million and cooperated with the investigation. Another former Goldman banker, Roger Ng, pleaded not guilty and is set to go on trial next year.

U.S. prosecutors also charged Mr. Low, who has never appeared in court to face charges but has denied wrongdoing.

Some within the bank were wary of Mr. Low, a flamboyant businessman who had befriended many Hollywood celebrities and was known for staging wild and extravagant parties in Las Vegas. The bank’s compliance department had rejected him as a client because it was unclear how he had amassed his wealth.

Even so, Mr. Low met in December 2012 with Lloyd C. Blankfein, who at the time was Goldman’s chairman and chief executive, at Goldman’s offices in New York. That was just a few weeks before the bank arranged the third bond deal for 1MDB.

The investigation of Mr. Low and the 1MDB scandal has been a multipronged affair.

On Tuesday, Elliott Broidy, a major fund-raiser for the Trump campaign in 2016, pleaded guilty to conspiring to violate foreign lobbying laws after accepting $9 million from Mr. Low to try to convince the Trump administration to end the 1MDB investigation, and take other steps. Mr. Broidy agreed to forfeit $6.6 million and to cooperate with prosecutors.

And a separate team of federal prosecutors in Los Angeles has been focused largely on recouping assets bought with the stolen funds. Mr. Low agreed last year to relinquish any claim to more than $900 million in assets that had been seized by the federal government, with much of those proceeds going back to Malaysia.

Kenneth P. Vogel and Nicole Hong contributed reporting.

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Justice Department Files Antitrust Lawsuit Against Google

WASHINGTON — The Justice Department accused Google of illegally protecting its monopoly over search and search advertising in a lawsuit filed on Tuesday, the government’s most significant legal challenge to a tech company’s market power in a generation.

In a 57-page complaint, filed in the U.S. District Court in the District of Columbia, the agency accused Google of locking out competition in search by obtaining several exclusive business contracts and agreements. Google’s deals with Apple, mobile carriers and other handset makers to place its search engine as the default option for consumers accounted for most of its dominant market share in search, the agency said, a figure that it put at around 80 percent.

“For many years,” the suit said, “Google has used anticompetitive tactics to maintain and extend its monopolies in the markets for general search services, search advertising and general search text advertising — the cornerstones of its empire.”

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The suit reflects the pushback against the power of the nation’s largest corporations, and especially technology giants like Google, Amazon, Facebook and Apple. Conservatives like President Trump and liberals like Senator Elizabeth Warren have been highly critical of the concentration of power in a handful of tech behemoths.

Attorney General William P. Barr, who was appointed by Mr. Trump, has played an unusually active role in the investigation. He pushed career Justice Department attorneys to bring the case by the end of September, prompting pushback from lawyers who wanted more time and complained of political influence. Mr. Barr has spoken publicly about the inquiry for months and set tight deadlines for the prosecutors leading the effort.

The lawsuit may stretch on for years and could set off a cascade of other antitrust lawsuits from state attorneys general. About four dozen states and jurisdictions have conducted parallel investigations and are expected to bring separate complaints against the company’s grip on technology for online advertising. Eleven state attorneys generals, all Republicans, signed on to support the federal lawsuit.

A victory for the government could remake one of America’s most recognizable companies and the internet economy that it has helped define since it was founded by two Stanford University graduate students in 1998. The Justice Department will not immediately put forward remedies, such as selling off parts of the company, in the lawsuit, the officials said. Such actions are typically pursued in later stages of a case.

Ryan Shores, an associate deputy attorney general, said “nothing is off the table” in terms of remedies.

Google has long denied accusations of antitrust violations, and the company is expected to fight the government’s efforts by using its global network of lawyers, economists and lobbyists. Alphabet, valued at $1.04 trillion and with cash reserves of $120 billion, has fought similar antitrust lawsuits in Europe. The company spent $12.7 million lobbying in the United States in 2019, making it one of the top corporate spenders in Washington.

The company says it has strong competition in the search market, with more people finding information on sites like Amazon. It says its services have been a boon for small businesses.

“Today’s lawsuit by the Department of Justice is deeply flawed,” Kent Walker, the company’s chief legal officer, said in a blog post. “People use Google because they choose to, not because they’re forced to, or because they can’t find alternatives.”

Mr. Walker said the lawsuit would do “nothing to help consumers. To the contrary, it would artificially prop up lower-quality search alternatives, raise phone prices and make it harder for people to get the search services they want to use.”

Democratic lawmakers on the House Judiciary Committee released a sprawling report on the tech giants two weeks ago, also accusing Google of controlling a monopoly over online search and the ads that come up when users enter a query.

“A significant number of entities — spanning major public corporations, small businesses and entrepreneurs — depend on Google for traffic, and no alternate search engine serves as a substitute,” the report said. The lawmakers also accused Apple, Amazon and Facebook of abusing their market power. They called for more aggressive enforcement of antitrust laws, and for Congress to consider strengthening them.

The scrutiny reflects how Google has become a dominant player in communications, commerce and media over the last two decades. That business is lucrative: Last year, Google brought in $34.3 billion in search revenue in the United States, according to the research firm eMarketer. That figure is expected to grow to $42.5 billion by 2022, the firm said.

In its complaint, the Justice Department said that Google’s actions had hurt consumers by stifling innovation, reducing choice and diminishing the quality of search services, including consumer data privacy. It also said that advertisers that use its products “must pay a toll to Google’s search advertising and general search text advertising monopolies.”

The lawsuit is the result of an investigation that has stretched for more than a year. Prosecutors have spoken with Google’s rivals in technology and media, collecting information and documents that could be used to build a case.

The Justice Department also investigated Google’s behavior and acquisitions in the overall market for digital advertising, which includes search, web display and video ads.

But the search case is the most straightforward, giving the government its best chance to win. To prevail, the Justice Department has to show two things: that Google is dominant in search, and that its deals with Apple and other companies hobble competition in the search market.

Gene Kimmelman, a former senior antitrust official at the agency, said the case focused on how Google’s lock on search allowed it to “control a treasure trove of user data and deny access to competitors.” He said the focus on contracts was significant because some were made when Microsoft’s Bing and Yahoo posed a competitive threat to Google’s search.

In its blog post, Google argued that there is nothing wrong with its agreements with Apple, other handset manufacturers and carriers, comparing them to cereal brands paying for prominent placement on store shelves. It also said it was not difficult for consumers to switch default settings from Google to another search engine.

Mr. Barr, a former telecom executive at Verizon who once argued an antitrust case before the Supreme Court, signaled that he would put the tech giants under new scrutiny at his confirmation hearing in early 2019. He said that “a lot of people wonder how such huge behemoths that now exist in Silicon Valley have taken shape under the nose of the antitrust enforcers.”

He put the investigation under the control of his deputy, Jeffrey Rosen, who in turn hired an aide from a major law firm to oversee the case and other technology matters. Mr. Barr’s grip over the investigation tightened when the head of the Justice Department’s antitrust division, Makan Delrahim, recused himself from the investigation because he represented Google in its acquisition of the ad service DoubleClick in 2007.

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Credit…Anna Moneymaker for The New York Times

Mr. Barr pushed prosecutors to wrap up their inquiries — and decide whether to bring a case — before Election Day. While Justice Department officials are usually tight-lipped about their investigations until a case is filed, Mr. Barr publicly declared his intention to make a decision on the Google matter by the end of the summer.

This year, most of the roughly 40 lawyers building the case said they opposed bringing a complaint by Mr. Barr’s Sept. 30 deadline. Some said they would not sign the complaint, and several left the case this summer.

In a call with reporters on Tuesday, the agency’s lawyers were guarded about many aspects of the investigation, such as whether they considered building out the case to other parts of Google’s business or about their conversations with the company. They specifically avoided answering a question about whether the agency spoke to Larry Page, Google’s co-founder and former chief executive of its parent company, Alphabet.

Google last faced serious scrutiny from an American antitrust regulator nearly a decade ago, when the Federal Trade Commission investigated whether it had abused its power over the search market. The agency’s staff recommended bringing charges against the company, according to a memo reported on by The Wall Street Journal. But the agency’s five commissioners voted in 2013 not to bring a case.

Other governments have been more aggressive toward the big tech companies. The European Union has brought three antitrust cases against Google in recent years, focused on its search engine, advertising business and Android mobile operating system. Regulators in Britain and Australia are examining the digital advertising market, in inquiries that could ultimately implicate the company.

“It’s the most newsworthy monopolization action brought by the government since the Microsoft case in the late ‘90s,” said Bill Baer, a former chief of the Justice Department’s antitrust division. “It’s significant in that the government believes that a highly successful tech platform has engaged in conduct that maintains its monopoly power unlawfully, and as a result injures consumers and competition.”

Google and its allies will likely criticize the suit as politically motivated. The Trump administration has attacked Google, which owns YouTube, and other online platform companies as being slanted against conservative views.

The lawsuit will likely outlast the Trump administration. The Justice Department spent more than a decade taking on Microsoft. The agency filed its lawsuit against the company in 1998 and the settlement was approved in 2002.

Google’s representatives said they anticipated that it would be at least a year before the case went to trial.

While it is possible that a new Democratic administration would review the strategy behind the case, experts said it was unlikely that it would be withdrawn under new leadership.

Steve Lohr contributed reporting

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What Is Happening With the Antitrust Suit Against Google?

The Justice Department sued Google on Tuesday, accusing the company of illegally abusing its dominance in internet search in ways that harm competitors and consumers.

The suit is the first antitrust action against the company, owned by Alphabet, to result from investigations by the Justice Department, Congress and 50 states and territories. State attorneys general and federal officials have also been investigating Google’s behavior in the market for online advertising. And a group of states is exploring a broader search case against Google.

Here is what you need to know about the suit.

This is one step against a single company. But it is also a response to the policy question of what measures, if any, should be taken to curb today’s tech giants, which hold the power to shape markets, communication and even public opinion.

Politics steered the timing and shape of this suit. Attorney General William P. Barr wanted to move quickly to take action before the election, making good on President Trump’s pledge to take on Big Tech. Eleven states joined the suit.

This is a monopoly defense case. The government says that Google is illegally protecting its dominant position in the market for search and search advertising with the deals it has struck with companies like Apple. Google pays Apple billions of dollars a year to have its search engine set as the default option on iPhones and other devices.

The Justice Department is also challenging contracts Google has with smartphone makers that use Google’s Android operating system, requiring them to install its search engine as the default.

The Justice Department also investigated Google’s behavior and acquisitions in the overall market for digital advertising, which includes search, web display and video ads. Online advertising was the source of virtually all of Alphabet’s $34 billion in profit last year.

But the search case is the most straightforward, giving the government its best chance to win. To prevail, the Justice Department has to show two things — that Google is dominant in search, and that its deals with Apple and other companies hobble competition in the search market.

In short: We’re not dominant and competition on the internet is just “one click away.”

That is the essence of recent testimony in Congress by Google executives. Google’s share of the search market in the United States is about 80 percent. But looking only at the market for “general” search, the company says, is myopic. Nearly half of online shopping searches, it notes, begin on Amazon.

Next, Google says the deals the Justice Department is citing are entirely legal. Such company-to-company deals violate antitrust law only if they can be shown to exclude competition. Users can freely switch to other search engines, like Microsoft’s Bing or Yahoo Search, anytime they want, Google insists. Its search service, Google says, is the runaway market leader because people prefer it.

Consumer harm, the government argues, can result in several ways. Less competition in a market means less innovation and less consumer choice in the long run. That, in theory, could close the market to rivals that collect less data for targeted advertising than Google. Enhanced privacy, for example, would be a consumer benefit.

Goods that are free to consumers are not exempt from antitrust oversight. In the landmark Microsoft case of the late 1990s, the software giant bundled its web browser for free into its dominant Windows operating system. Microsoft lost because, using restrictive contracts, it bullied personal computer makers and others to try to prevent them from offering competing web browser software — competition that could have undermined the Windows monopoly.

Unless the government and Google reach a settlement, they’re headed to court. Trials and appeals in such cases can take years.

Whatever the outcome, one thing is certain: Google will face continued scrutiny for a long time.

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U.S. Investigates Vaxart’s Claims Related to Covid-19 Vaccine

Vaxart, a California biotech firm that is attempting to develop a Covid-19 vaccine, has come under scrutiny from federal prosecutors and the Securities and Exchange Commission.

The company announced in June that it had been selected to participate in Operation Warp Speed, the U.S. government’s flagship effort to develop cures and treatments for Covid-19. That sent Vaxart’s stock price soaring, allowing a hedge fund that controlled the company to reap an instant $200 million profit by selling shares.

The New York Times reported the following month that Vaxart appeared to have overstated its involvement in Operation Warp Speed.

Vaxart said it had received a subpoena from the Justice Department concerning its role in Operation Warp Speed and the stock sales in July, the company disclosed in a securities filing this week.

In August, the S.E.C.’s enforcement division requested documents from the company about the same matter, Vaxart said in the filing, which was first reported by Fierce Pharma, a trade publication.

“We are cooperating with the U.S. Attorney’s Office regarding these requests and have provided documents and information in response,” Vaxart said in the securities filing. It added that it had “voluntarily provided documents requested by the S.E.C. and is cooperating with this informal inquiry.”

A number of shareholder lawsuits have also been brought against Vaxart, its executives and its board, accusing the company of misleading investors by overstating its role in Operation Warp Speed.

Vaxart is one of dozens of companies pursuing coronavirus vaccines. But the company, which had just 15 employees this summer, is not among the drug makers that have received substantial funding for their research and production efforts through Operation Warp Speed.

Nonetheless, the company in June issued a news release that stated: “Vaxart’s Covid-19 Vaccine Selected for the U.S. Government’s Operation Warp Speed.” That sent shares of the company soaring, and within days, a hedge fund, Armistice Capital, had sold shares worth more than $200 million.

But Vaxart’s involvement in Operation Warp Speed was limited. Its vaccine candidate was one among those being tested in an animal trial sponsored by the federal initiative. Officials at the Department of Health and Human Services, which is coordinating Operation Warp Speed, distanced the department from the company, saying it was involved only in preliminary studies but had not yet won government support.

The value of Vaxart stock has fallen by more than 50 percent since mid-July, when it hit new highs on the heels of its Operation Warp Speed announcement.

This week, the company said it had begun its Phase 1 trial and that initial tests on hamsters yielded promising results.

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Justice Dept. Case Against Google Is Said to Focus on Search Dominance

WASHINGTON — The Department of Justice’s impending lawsuit against Google has narrowed to focus on the company’s power over internet search, a decision that could set off a cascade of separate lawsuits from states in ensuing weeks over the Silicon Valley giant’s dominance in other business segments.

In presentations to state attorneys general starting on Wednesday, the department is expected to outline its legal case centered on how Google uses its dominant search engine to harm rivals and consumers, said four people with knowledge of the plan, who spoke on the condition of anonymity because the details were confidential. Meeting with the state attorneys general is one of the final steps before the department files its suit against the company, they said.

The Justice Department’s action against Google is set to be narrower than what some states and several career lawyers in the department had envisioned. The department also investigated Google’s reach in ad technology and how the company prices and places ads across the internet. But in an effort to file a case by the end of September, the agency decided to pick the piece that was furthest along in legal theory and that it felt could best withstand a potential challenge in court.

The department has not written the final draft of its complaint against Google, and the document is expected to change over the next few days to reflect internal deliberations and input from constituents like the state attorneys general. Suing Google would fulfill a push by Attorney General William P. Barr to take action against a tech giant around the end of September, an effort that has taken on greater urgency ahead of the Nov. 3 election as President Trump fights for a second term.

The Justice Department and 48 states agreed to open their investigations into Google’s dominance a year ago as a bipartisan effort, but the last-minute jostling about what is included in the cases and how they should play out has exposed political fault lines. The department is seeking support of the search case and is set to file a lawsuit even without bipartisan support from state attorneys general, two people with knowledge of the plan said.

On Wednesday, Republican state attorneys general will also attend a meeting with Mr. Trump and Mr. Barr over concerns of censorship by social media companies, according to two people with knowledge of the plan.

If Mr. Barr brings the case by the end of this month, he will override lawyers who worked on the investigation and who said they needed more time to bring what they considered to be a strong lawsuit.

Mr. Trump has supported efforts to restrain the power of Amazon, Apple, Facebook and Google. Last summer, the Justice Department and the Federal Trade Commission opened antitrust investigations into the four tech companies, which combined are valued at more than $5 trillion. The investigations were buttressed by state investigations and a separate House inquiry into alleged monopoly abuses by the four giants.

The Justice Department and Google declined to comment.

The department’s complaint could come as early as next week and is expected to start a multipronged battle against Google, the search giant owned by Alphabet. While details are still being completed, the case on search is expected to focus on Google’s agreements with other companies like Apple, which set its search engine as the default option for users on iPhones and other devices. Those agreements give Google’s search engine an advantage over other rivals.

The complaint is expected to be followed by other antitrust actions against Google by the end of the year, according to people with knowledge of the plans by the department and states.

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Credit…Al Drago for The New York Times

Separately, an investigation by state attorneys general of Google’s behavior in digital advertising — the source of virtually all of Alphabet’s $34 billion in annual profit — is nearly complete. That investigation, led by Ken Paxton, the Republican attorney general of Texas, is expected to result in a suit accusing Google of using tactics that have undermined competition in the market for online advertising, a person briefed on the inquiry said.

That suit, the person said, should be ready to be filed soon, with the Justice Department potentially joining as a plaintiff but with Texas taking the lead. A spokeswoman for Mr. Paxton did not immediately respond to a request for comment.

There is also the potential for an additional, broader suit by the states, led by Phil Weiser, the Democratic attorney general of Colorado. It would include more wide-ranging allegations of Google using its dominance of the search market to favor its shopping and other services, the person said.

That investigation is still in progress, and a case, if filed, would come later than the other two, the person said. Mr. Weiser declined to comment.

Google controls about 90 percent of web searches globally, and rivals have complained that the company extended that power by making its search and browsing tools the defaults on many smartphones. Google also captures about one-third of every dollar spent on online advertising, and its ad tools are used to supply and auction ads that appear across the internet.

The contracts Google reaches with other tech companies to serve as a default search engine have already attracted attention internationally, in inquiries that may provide a preview into the argument by the Justice Department.

Britain’s Competition and Markets Authority said in a report this summer that the scale of Google’s payments to mobile phone makers like Apple for its search engine to be the default on those devices was “striking and demonstrates the value that Google places on these default positions.” The regulator also found that those agreements were “a barrier to expansion for other search engines.”

Cecilia Kang and Katie Benner reported from Washington, Steve Lohr from New York and Daisuke Wakabayashi from Oakland, Calif. David McCabe contributed reporting from Washington.