IP Law Daily, TECHNOLOGY/INTERNET—N.D. Cal.: Yelp may proceed with narrowed monopolization claims against Google, (Apr 23, 2025)

By Martin A. Steinberg, J.D.

Google allegedly monopolized the local search services market through self-preferencing and tying its local search services to its general search services.

The federal court in San Jose, California partially granted Google LLC’s motion to dismiss Yelp Inc.’s antitrust case. Yelp, founded in 2004, is a prominent local search services provider and specialized vertical provider (SVP) with a mission to connect consumers with local businesses through local searches. Yelp filed a suit against Google for engaging in various anticompetitive practices, which were allegedly designed to monopolize the markets for local search services and local search advertising. The court (1) dismissed the monopolization and attempted monopolization claims with leave to amend but only to the extent they rely on refusal to deal claims; (2) dismissed the tying claim with leave to amend, both as time barred as pleaded and as failing to state a claim; (3) dismissed the monopoly leveraging claims as duplicative of Counts I-III with leave to amend; and (4) refused to dismiss the California Unfair Competition Law (UCL) claim (Yelp Inc. v. Google LLC, No. 5:24-cv-06101-SVK (N.D. Cal. Apr. 22, 2025)).

Background. Yelp had no complaints about Google’s early activity in the internet search space, but that began to change in the mid-2000s, when Google allegedly became “threatened by the rise of SVPs” such as Yelp. First, in the mid-2000s, Google began developing vertical search engines in-house, including Google Images, Google Maps, Google Books, Google Videos, and Google News. Yelp alleged that Google Maps is effectively “Google’s local search,” as 77% of respondents to SearchEngineLand.com reported using Google Maps “to find ‘near me’ business information well ahead of other sites.”

Then, in 2007, Google launched universal search, which blended Google’s in-house verticals with its general search results. In 2015, Google allegedly adjusted its algorithm to decrease traffic to its local search competitors, causing Yelp to have its first-ever decline in year-over-year traffic. The Complaint was largely silent regarding Google’s actions between 2016 and 2024.

On August 28, 2024, Yelp filed suit alleging that Google engaged in various anticompetitive practices violating Section 2 of the Sherman Act and California’s Unfair Competition Law. The complaint alleged that Google has monopolized the local search services market (Count I), has attempted to monopolize the local search services market (Count II), and has attempted to monopolize the local search advertising market (Count III). These claims include allegations of “a tying arrangement, a refusal to deal, monopoly leveraging and monopolistic product design/redesign,” including by “self-preferencing.” The complaint further alleged that Google had unlawfully tied its local search services to its general search services (Count IV), had unlawfully leveraged its monopoly in general search services to “attempt to create or maintain a monopoly in” both Local Search Services and local search advertising (Counts V-VI) and by engaging in the conduct alleged to violate the Sherman Act, Google had breached California’s UCL (Count VII). On October 28, 2024, Google moved to dismiss the Complaint.

Time-barred. The court found that the claim alleging that Google had unlawfully tied its local search services to its general search services, was time-barred. Actions under the Sherman Act are subject to a four-year statute of limitations. Yelp’s claims are untimely only if Yelp alleged that Google engaged in exclusionary conduct while having either monopoly power or a dangerous probability of achieving monopoly power outside of the limitations period. Thus, the complaint may only be dismissed on statute-of-limitation grounds if Yelp has pleaded “itself out of court” by alleging that Google had market power and engaged in exclusionary conduct before August 28, 2020. However, the Court may dismiss the Complaint simply for failing to state a claim if it finds that Yelp has not sufficiently alleged monopoly power at all.

Counts I and II. Google’s motion to dismiss claims for monopolization and attempted monopolization as time-barred was denied. To set forth a monopolization claim, Plaintiff must allege, inter alia, that Defendant possessed monopoly power in the relevant market. Yelp’s first claim alleges that Google maintained a monopoly in local search services, violating antitrust law. Yelp’s second claim alleges that Google has attempted to monopolize local search services, violating antitrust law. The relevant market for these claims is the local search services market.

Although not conclusive, Yelp’s allegation of 90% market share is also supported by a 2022 study finding that Google’s share of local business reviews had grown by 73% compared to Yelp’s 6%, and a November 25, 2019, publication suggesting that 77% of consumers used Google’s local search (Google Maps) to find “near me” business information well ahead of other sites. Accordingly, Yelp has at least sufficiently pleaded monopoly power for Count I.

The timing of when Google crossed the 65% threshold of market power was not precise from the face of the Complaint. Similarly, the timing of when Google crossed a lower threshold, sufficient for a dangerous probability of achieving monopoly power, was also not precise.

Count III. Yelp’s third claim alleged that Google has attempted to monopolize the local search advertising market, violating antitrust law. The only difference between Count III and Count II was that Yelp alleged a different relevant market. Yelp alleged that local search advertising is the relevant market for Count III.

Yelp pleaded that, based upon its understanding, belief, and estimation, “Google’s share of the market for local search advertising in the United States (by ad revenue) exceeds 50% and continues to grow each year.” This is a present-tense allegation in the light most favorable to Yelp. It is plausibly sufficient as an allegation of a dangerous probability of monopoly power. Yelp does not specify at what point Google’s share of the local search advertising market crested the threshold of dangerous probability. Accordingly, as with Counts I-II, the court could not conclude that Plaintiffs’ local search advertising claim is time-barred at this early stage.

Count IV. The situation is different about Yelp’s tying claim, which alleges that “Google has unlawfully tied its local search product to its general search product.” On the face of the Complaint, it was apparent that its tying allegations are based on an exercise of monopoly power in 2007 or 2015. The relevant inquiry here was whether and when Yelp alleged that Google acquired enough economic power in the general search services tying market. Yelp alleged that Google has enough monopoly power in general search services today, with approximately 88 percent market share. Yelp further alleged that “in July 2007, Google estimated its general search services market share at 68 percent,” with an increase to 77% in 2013 and 79% in 2018. This is well outside the four-year statute of limitations period.

The continuing violations doctrine is an exception to the four-year time limit of the statute of limitations. Yelp argued that Google has taken actions, that its conduct has worsened, that it has “increased triggering of OneBox results,” has “tweaked its algorithms,” and engaged in other “fine-tuning,” “refinements,” and “progression.” However, these allegations are insufficient when they lack dates or details about the changes. The only sufficient allegation of changed conduct was the 2015 change to Google’s algorithm, which would not place Yelp within the limitations period. Even though Yelp cannot escape its general-search monopoly power allegations dating back to 2007 or 2013, the court allowed it to plead additional exclusionary conduct, if any, sufficient to allege a continuing violation within the limitations period.

The court further granted Google’s Motion to Dismiss Count IV because Yelp failed to plausibly allege express or implied coercion. The court noted that at this stage, it could not say that Yelp’s tying claims are categorically foreclosed simply because it alleged that Google monetizes consumer data rather than directly taking money from the users. Coercion is often the touchstone issue in assessing a claim of illegal tying. Yelp alleged coercion via two means: Google imposed a positive tie via Google’s Terms of Service, and Google’s SERP design, including the OneBox, automatically serves local search results to users of general search.

First, users are bound by Google’s Terms of Service (ToS) when they use its services, such as Google Search and Google Maps. But Google’s ToS do not require users to use Google’s local search results; they merely prevent users from modifying the SERP design on the user’s end. Second, to allege implied coercion, Yelp must allege that “an appreciable number of buyers have accepted burdensome terms,” or analogously, that an appreciable number of users have accepted Google’s local search results. However, Yelp appeared to allege that 70% of clicks go to non-Google properties. Even viewed in the light most favorable to Yelp, such an allegation is insufficient to allege implied coercion plausibly.

Monopoly leveraging claims. Yelp’s monopoly leveraging claims were dismissed as duplicative of its monopolization and attempted monopolization claims. Yelp’s fifth and sixth claims alleged that Google has leveraged its monopoly power in general search services “to create or maintain a monopoly in the local search” services and advertising markets. The parties agree that, under Alaska Airlines, Inc. v. United Airlines, Inc., 948 F.2d 536, 549 (9th Cir. 1991), monopoly leveraging is not a free-standing cause of action in the Ninth Circuit unless there is some allegation of predatory or anticompetitive conduct, such as conduct used for “the creation, or attempted creation, of a monopoly through monopoly leveraging.” The parties seemed to agree that Yelp alleged anticompetitive conduct, though that conduct was no different from the anticompetitive conduct alleged to support Counts I-III.

To streamline the Complaint, the court dismissed Counts V and VI with leave to amend. Yelp may continue to assert the same monopoly leveraging theory as part of Counts I-III and amend Counts V-VI if it can allege anticompetitive conduct that is sufficient under Alaska Airlines and not duplicative of other claims.

Refusal to deal claims. The court dismissed Counts I-III to the extent they rest on Yelp’s refusal-to-deal claims, with leave to amend. The Supreme Court held that refusal to deal could violate the Sherman Act in Aspen Skiing Co., 472 U.S. 585 (1985), and the Ninth Circuit found similarly in MetroNet Services v. Qwest, 383 F.3d 1124 (9th Cir. 2004).

Yelp, however, had not sufficiently alleged the elements of a refusal to deal. Yelp did not plausibly allege that Google sacrificed short-term benefits, nor was it “the only conceivable rationale” for its SERP redesign. First, Yelp alleged that Google changed “a voluntary and profitable course of dealing” because it alleged that Google used to feature Yelp and other SVPs at the top of its SERP, that this was profitable for both Yelp and Google and that organic search results (like Yelp) now appear at the bottom of the SERP and on the second page. Second, Yelp needed to allege that “the only conceivable rationale or purpose is to sacrifice short-term benefits to obtain higher profits in the long run from the exclusion of competition.”

UCL claim. The parties agreed that the UCL claims should be dismissed or upheld for the same reasons as their Sherman Act claims. Accordingly, because the court found that at least some of Yelp’s Sherman Act claims survive, Google’s Motion to Dismiss the UCL claim was denied.

The Case is No. 5:24-cv-06101-SVK.

Judge: Keulen, S.

Attorneys: Sathya S. Gosselin (Hausfeld LLP) for Yelp Inc. John Edward Schmidtlein (Williams & Connolly LLP) for Google LLC.

Companies: Yelp Inc.; Google LLC

Cases: TechnologyInternet CaliforniaNews