Google Wins Court Battle Against StreetMap In The UK

A View from Constantine Cannon’s London Office

By Yulia Tosheva and Richard Pike

Google won a big victory Friday in the High Court of England and Wales, which ruled that Google did not abuse its dominant position to the detriment of the now-defunct UK online mapping provider, Streetmap.

The Court’s ruling against Streetmap’s claim for damages from Google for abuse of a dominant position (or monopolization, as it would be called in the U.S.) has rightly been hailed as a thorough and careful assessment of both the factual and legal issues. The High Court judge responsible, the Honourable Mr. Justice Peter Roth, is a competition law expert who has recently taken over as the President of the specialist Competition Appeals Tribunal.

Streetmap argued that it lost market share and ultimately failed because of the introduction of Google’s “Maps OneBox” at the top of its search results page in 2007. The Maps OneBox included a Google Map and no maps from rival providers. Streetmap claimed that Google had a dominant position in online search, and that the introduction of the Maps OneBox represented an abuse of that dominance to secure an advantage in an allegedly separate market for online maps.

Commentators have been watching this litigation closely for possible insights into the prospects for both the European Commission’s pending Google investigations and other litigation pending against Google (including a claim by Foundem in the UK). The judgment, however, offers few clues to the outcomes of those parallel proceedings.

One reason for saying this is because the Court did not address the question of whether Google is actually dominant in any relevant market. While this will be a hotly-contested issue in the other proceedings, Streetmap and Google decided in their litigation to address the issue of abuse first, and now will not address the existence of dominance at all.

Secondly, this result turned more on the facts than the law. Streetmap failed to convince the Court that it was the introduction of the Maps OneBox that caused its decline. Streetmap had been an online mapping pioneer – in the UK at least – but it did not keep up with its rivals when it introduced new functionality into its maps. In particular, Streetmap failed to introduce so-called “slippy” maps, had issues with zooming and could not handle natural language searches such as a request to show “Indian restaurants in Birmingham.” The Court evidently concluded that Streetmap failed because Google offered a better mapping product, not because Google unfairly took advantage of a possibly dominant position in online search. In short, this was competition in all its glory – red in tooth and claw – not a failure of competition.

There were still, though, a few legal conclusions of note. Perhaps most interesting was the distinction that Mr. Justice Roth drew between abuse of dominance that has an effect on the market in which dominance exists and abuse that, as here, is only alleged to have an effect in a different market. Mr. Justice Roth concluded that a higher standard ought to apply for proof of an anticompetitive effect to the extent those effects occur outside the market where dominance is established. His logic was that any increase in market power is likely to harm competition where there is already dominance but there can be no such assumption where market shares are more evenly balanced. Although this reasoning makes some sense, it is still a new and controversial position.

Streetmap has already announced that it will seek permission to appeal, and it will undoubtedly attack the legal point just mentioned. However, Streetmap is likely to have an uphill battle in seeking to overturn a judgment so heavily reliant on the facts.

– Edited by Gary J. Malone