Google's search-secrets defeat of Kelkoo offers litigation confidentiality lessons

07 Jul 2021 3:25 pm by Simon Zekaria

Google search

Google has fended off a fresh raid on its “crown jewels,” the secret algorithms behind its lucrative search-engine rankings — and other companies holding valuable proprietary information would be well advised to study the case.

The relieving win came at the High Court in London, which rejected a request by shopping comparison website Kelkoo to open up to more people the disclosure of documents from Google, as part of its market-abuse lawsuit against the US tech giant. Kelkoo has since 2015 claimed that Google tried to squeeze it out with its own comparison product, Google Shopping.

Kelkoo's demand was simple: to expand the number of people allowed to read confidential documents in the case by loosening a "confidentiality ring," where access to specified sensitive material that is key to a claim before trial is granted only to a certain group, typically lawyers and experts.

While common in antitrust litigation, confidentiality rings aren’t straightforward to manage. Courts must weigh rights of access to the disclosing party's documents, and that task becomes delicate where disclosure risks exposing valuable commercial data or trade secrets.

The threat was outlined by Google when it argued to the court that the codes behind its search technology were exposed to unjustifiable risk from Kelkoo's proposals. The High Court agreed and said they should be protected — at least for now.

That is a small win for Google before full proceedings commence, and it has lessons for other companies guarding commercially sensitive data, particularly in the court's wider comments over the role of confidentiality in disclosure exercises during litigation.

‘Essential’ secrets

Such a disclosure exercise was under way when Kelkoo made its application, triggered by Google’s disclosure of confidential versions of EU decisions against the company in 2017 and 2019.

In those decisions, the European Commission fined Google billions of euros for abusing its market dominance as a search engine by promoting its own shopping service and through online advertising practices.

In seeking an order over the decisions and other Google documents, Kelkoo requested bespoke arrangements for confidentiality rings and for Google to justify any redactions.

But Google, among its arguments, stressed the sensitivity of some of its information. Citing its arguments, the court called them "secrets essential to a hugely valuable business."

Google's concern is rational. Faced with litigation around the world over its search engine, the company has a longstanding fear that technical and operational know-how of its search tools will leak out to the wider market. That would mean it ceding its commercial edge to others with search services including Microsoft, Yahoo, Baidu and DuckDuckGo.

Finding in Google's favor in his ruling late last month, Judge Alan Johns said Kelkoo's proposals weren't suitable at this stage of the proceedings, although his rejection of them wouldn't prejudice the company's "proper participation" in the case.

In doing so, Johns made a significant finding: Kelkoo's proposals might have led to disclosure disputes with Google over confidential material — some going back a decade — not relevant to the proceedings. Sensitive information relating to Google’s algorithms is "at risk of being revealed,” he said, because a "procedural fault or oversight [could reveal] key commercial secrets."

In other words, even if a document revealing information on a secret algorithm were to end up being of no relevance to Kelkoo's claim, the confidentiality status of that information remains live and at risk of exposure. Instead, said Johns, focus must be only on documents that "appear to be of real significance to the case."

Such early-stage caution over confidentiality will be noted by all companies seeking to gain a tactical leverage in antitrust proceedings.

Lawsuits against Google

The court's caution also shows up in its additional findings.

Kelkoo argued that its proposals were valid because Google, it alleged, disproportionately categorized documents as highly sensitive in a separate lawsuit against it — that from Infederation, the company behind Foundem, another shopping comparison service. The High Court said Kelkoo was accusing Google of “over-designating” documents in the Infederation suit.

Linking the two claims would seem logical. Like Kelkoo, Infederation said Google’s search algorithms advantaged its own shopping-search services, thereby causing the claimant financial loss. Infederation's claim against Google also sparked a dispute over confidentiality that was later ruled on by the High Court.

But, on confidentiality, Johns warned against a read-across from one suit to the other. "I cannot resolve that dispute in those different proceedings on this application,” he said.

Johns also made observations on another issue that Kelkoo, and others, would do well to digest.

In his confidentiality ruling for the Infederation lawsuit, Judge Peter Roth at the High Court aired wider grievances over disclosure disputes. He said competition judges, and courts more generally, are frustrated by confidentiality claims that make “excessive” demands, only for these to end up being rowed back following pressure by the opposing side or intervention by the court.

In plain words, handling a to-and-fro disclosure dispute, characterized by the reclassification of documents based on legal argument, is a headache and "wasteful" of time and resources. It is "not the way modern litigation should be conducted," Roth warned.

On the face of it, Roth's warning would suggest that Kelkoo's demands — designed to dilute confidentiality protection for big companies such as Google — should be seen in a positive light.

But in his ruling on Kelkoo's suit, Johns said Roth had been making “general observations” that weren't directed specifically at Google. It amounted to a "general tendency" on confidentiality that is "not sufficient" to give validity to Kelkoo’s application, he said.

In that respect, Johns' ruling delivered an important message: confidentiality arrangements in litigation disclosure will be treated on a case-by-case basis. Kelkoo's demands were not the “right course in the circumstances,” he said.

Kelkoo, while disappointed, has vowed to unravel "Google’s web of data" and retains ambitions of "holding Google to account." It and others will argue that, as alleged victims of malpractice, Google and others deserve attempts to strip back confidentiality, because these spring from behavior that is suspected of being unlawful and that prompted legal action in the first place.

But courts have a wider lens in view, especially as companies become ever more aware that their secrets are fertile ground for confidentiality disputes. As these clashes grow, others might hope to have the success that Google has experienced.

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