Dream Big Media Inc. v. Alphabet Inc.

Background

Dream Big Media Inc., Getify Solutions, Inc., and Sprinter Supplier, LLC alleged that they used mapping products supplied by Google, LLC and Alphabet Inc., collectively called Google. Those products included application programming interfaces, or APIs, that allow one computer application to retrieve and use data from another. The plaintiffs challenged Google’s terms of service for its Maps Platform under the Sherman Act, the Clayton Act, and California’s Unfair Competition Law.

In the second amended complaint, Dream Big and Getify pursued a conventional negative-tying theory. They alleged that, after buying Google Maps APIs, they were forced by Google’s terms to buy Google Places and Routes APIs, even though they preferred competitors’ products. Sprinter did not allege that it bought Google Maps APIs and did not bring a tying claim, but asserted that it could pursue exclusive-dealing and other theories.

The disputed term stated that customers could not “link” a Google Map to non-Google maps content or a non-Google map. The court noted that other parts of the terms expressly used the words “use” and “display.” Google argued that the disputed provision barred only linking a Google map to non-Google content or a non-Google map, not using competitors’ places or routes APIs with a Google map. The plaintiffs argued that the provision prevented customers from using competitors’ places or routes APIs in conjunction with Google maps.

Legal standard

The court applied Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint states a legally sufficient claim. A complaint must contain enough factual allegations to make liability plausible, not merely possible. The court was required to accept material allegations as true and interpret them in the plaintiffs’ favor when evaluating the motion.

Court’s analysis

The court concluded that the plaintiffs had not shown how the prohibition on “linking” a Google map to non-Google content or a non-Google map could reasonably be understood to prohibit using competitors’ places or routes APIs with a Google map. The plaintiffs had not plausibly alleged that Google prevented Maps API customers from using competitors for their places and routes needs through the express terms, ambiguity, a chilling effect, or another mechanism.

The court also held that the plaintiffs could not plausibly allege coercion while maintaining that competitors offered maps APIs that were better or cheaper than Google’s. In a tying claim, coercion must exist before the buyer makes the purchase. The court rejected the plaintiffs’ argument that Dream Big and Getify were unable to purchase alternative places or routes APIs after buying Google Maps APIs, explaining that a buyer who could obtain the tying product on equally advantageous terms from another source was not coerced in the required sense.

The court further found that the plaintiffs had not adequately supported their proposed maps-API market or Google’s alleged market power. It stated that the market allegations, standing alone, might not have warranted dismissal at the pleading stage, but that their deficiencies reinforced dismissal when considered with the problems in the tying theory.

The exclusive-dealing claim rested on the same alleged negative tie and therefore failed with that claim. The plaintiffs’ claim under Section 2 of the Sherman Act also failed because they had not plausibly alleged exclusionary or anticompetitive conduct. Finally, the plaintiffs’ only stated basis for the California Unfair Competition Law claim was their antitrust theory, so that claim failed as well.

Disposition

The court dismissed the second amended complaint without leave to amend. It stated that a separate judgment would be entered.