Judge Sanctions Google for Deleting Evidentiary Chats for Play Store MDL

“Sanctions are warranted” against Google for failing to preserve messages on its internal chat system before and during the antitrust multidistrict litigation challenging Google’s Play Store practices as anticompetitive, said a “findings of fact” order signed Tuesday (docket 3:21-md-02981) by U.S. District Judge James Donato for Northern California in San Francisco. The plaintiffs in the four consolidated cases that comprise the MDL include 38 states and the District of Columbia, plus Epic Games, the Match Group and a group of consumers, all alleging Google monopolized Android app distribution and availability through Google Play.

A “reasonable” monetary remedy is for Google to reimburse the plaintiffs’ attorneys’ fees and other costs to pursue their Rule 37 motion to hold Google accountable for the deleted chats, said Donato. He ordered the plaintiffs to file a statement by April 21 of proposed attorneys’ fees and costs with “adequate documentation.” The parties will meet and confer on the proposal, and file a joint statement by May 12 “indicating an agreement or identifying specific areas of disagreement” for Donato to resolve.

Finding an appropriate “non-monetary sanction requires further proceedings,” said Donato’s order. The court “fully appreciates plaintiffs’ dilemma of trying to prove the contents of what Google has deleted,” it said. But the “principle of proportionality demands that the remedy fit the wrong,” and Donato needs to see “the state of play of the evidence at the end of fact discovery,” it said. The plaintiffs then will be “better positioned” to tell the court what might have been lost in the deleted chats, it said.

Donato’s order sends “a strong message” that California won’t let companies “hide from accountability when they break the law,” said California Attorney General Rob Bonta (D) in a statement Tuesday. “Google has now not only violated the trust of Android phone customers by limiting consumer choice and raking in outrageous commissions, but has also violated the discovery process in this case.”

Google's teams "have conscientiously worked, for years, to respond to Epic and the state AGs’ discovery requests," emailed a spokesperson Wednesday. Google has produced more than 3 million documents in discovery, "including thousands of chats," he said. "We’ll continue to show the court how choice, security, and openness are built into Android and Google Play.”

Donato and the plaintiffs found out in October 2021 that internal chats with the default setting “history off” were typically deleted in 24 hours, and that Google hadn’t suspended that auto-deletion function even after the litigation began. “Google chose instead to let employees make their own personal choices about preserving chats,” said Donato’s order.

The judge spared Google few punches in criticizing its evidentiary conduct. “Google employees are no strangers to document production and discovery obligations,” said Donato’s order. “At any given time, Google has thousands of employees who are under a litigation hold for document preservation.”

A major concern is the “intentionality manifested at every level within Google to hide the ball” when confronted about the deleted chats, said Donato’s order. Google “had the capacity” of preserving all internal chats once litigation began “but elected not do so, without any assessment of financial costs or other factors that might help to justify that decision,” it said.

That’s in “sharp contrast” to Google’s handling of email, said Donato’s order. “When a litigation hold is in place, Google automatically preserves all emails from relevant custodians without requiring any individual action,” it said. Custodians can’t override the “automated preservation” of their emails, it said.

But Google “took the opposite course” with the chats, said Donato’s order. It gave each employee “carte blanche to make his or her own call about what might be relevant in this complex antitrust case,” and whether a chat should be preserved, it said. Google “aggravated the situation by intentionally deciding not to check up on employee decisions to ensure that relevant evidence was being preserved,” it said. “In effect, Google adopted a ‘don’t ask, don’t tell’ policy” for preserving the chats, “at the expense of its preservation duties,” it said.

Of the suggestion that Google “has generally pressed” in its briefs that the internal Chat system “was primarily a social outlet akin to an electronic break room,” the record “demonstrates otherwise,” said Donato’s order. “An abundance of evidence establishes that Google employees routinely used Chat to discuss substantive business topics, including matters relevant to this antitrust litigation,” it said.

The testimony of Jamie Rosenberg, now a part-time adviser at Google, but previously a vice president, “highlighted a fundamental problem with Google’s approach to Chat preservation,” said Donato’s order. Rosenberg testified he had his messages default to “history off” during his entire time at Google, including when he was deposed for the MDL, and that he had done nothing to preserve chats for this litigation, it said. “Google left employees largely on their own to determine what Chat communications might be relevant to the many critical legal and factual issues in this complex antitrust litigation.”

What matters in the case “is how Google responded after the lawsuits were filed, and whether it honored the evidence preservation duties it was abundantly familiar with from countless prior cases,” said Donato’s order. “The record establishes that Google fell strikingly short on that score,” it said. The court has since “had to spend a substantial amount of resources to get to the truth of the matter, including several hearings, a two-day evidentiary proceeding, and countless hours reviewing voluminous briefs,” it said. “All the while, Google has tried to downplay the problem and displayed a dismissive attitude ill tuned to the gravity of its conduct.”