Who needs friends? Alphabet (GOOGL) stock was looking 4% shabbier today as an $8.3 billion lawsuit brought against it by buy-now, pay-later group and new partner Klarna (KLAR) continued in Sweden.
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Shopping Promotions
The Swedish court case, which began on October 20, is hearing a lawsuit brought by Swedish price comparison site Pricerunner, owned by Klarna, against tech giant Google. It claims that Google promoted its own shopping comparisons in search results.
The Swedish tech startup filed its suit with the Patent and Market Court in Stockholm in 2022, following a European Union General Court ruling that Google “breached EU antitrust laws by manipulating search results in favour of their own comparison shopping services.”
Originally, Pricerunner said it was suing Google for around $2 billion but claims that the final damages will be much higher because the alleged “violation is still ongoing.”
According to AFP Klarna is seeking approximately $8.3 billion “based on economic analysis of losses incurred.” These damages could also “grow daily” it warned.
Google Responds
Klarna said that “to reach consumers online, you need to be visible in search results. And that’s where Google has almost complete power”, noting that more than 90 percent of searches in Europe go through Google’s platform.
“We strongly oppose this lawsuit and look forward to presenting our case in court,” a Google spokesman said.
It is why legal and regulatory risks are of such concern to tech stocks such as Google and its investors – see below:
The court case is also uncomfortable for Google and Klarna, not just because of the publicity and risk of winning or losing, but because the two are now partners.
Earlier this month Klarna, which went public in September at a $15 billion valuation, said it had teamed up with Google Cloud. The goal is to deploy Google’s AI models to create creative marketing campaigns and boost security on its platform.
Those conversations may feel slightly edgy before the Swedish court case ends in mid-December.
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