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Google made donation during FTC probe
Google’s donation to an event to honor FTC Chairman Jon Liebowitz, whose commission was investigating Google’s search practices, has brought up ethics questions.
Google contributed $25,000 to honor the chairman of the Federal Trade Commission while the company was under investigation by the agency for antitrust violations, Senate records show.
Google donated the money to Common Sense Media, a San Francisco-based advocacy group that gave FTC Chairman Jon Leibowitz an award for his work in developing policies to help children, according to a January disclosure report. Google was listed as one of the sponsors of the awards ceremony along with several other companies, including Comcast, AOL and a charitable arm of Goldman Sachs.
At the time, the FTC was investigating whether Google unfairly disadvantaged competing websites by favoring its own services in search results. The agency ended the 20-month antitrust probe on Jan. 3 with no enforcement action. Google agreed to voluntary changes in some search practices and signed a consent decree regarding the use of certain patents.
“It’s a little bit odd that they’re donating to Common Sense Media at the exact same time they’re trying to influence Jon Leibowitz,” said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington, a watchdog group. “It really looks terrible.”
“When you start having problems, you start lobbying, you start making political donations and you start financing the favored charities of those you wish to influence,” Sloan said.
Leibowitz, who had been chairman since 2009, announced on Feb. 1 that he would leave the commission. The White House announced Thursday that current Commissioner Edith Ramirez will succeed him as chairman.
Google was the only corporate sponsor of Common Sense Media’s April 25, 2012, awards ceremony to report its contribution under a 2007 law that requires registered lobbyists and those companies and trade associations that hire advocates to disclose to Congress their political giving. Google also sponsored the event in 2010 and 2011, according to the advocacy group’s website, without reporting those donations.
“It’s probably better to avoid this type of thing. The appearance raises a question or two” for both the FTC and Google, said Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware. At the same time, “in this close, connected world, things like this will appear,” he said.
Kenneth Gross, a campaign-finance expert with the law firm of Skadden, Arps, Slate, Meagher & Flom, said the law requires disclosure when companies play major roles in setting up events. They aren’t required to report modest donations, such as reserving a table. Even so, some companies do report donations when they aren’t required to, he said. “I’ve seen a lot companies err on the side of disclosure,” Gross said.
Samantha Smith, a spokeswoman for Google, and Mitch Katz, an FTC spokesman, declined to comment for this article, as did Marisa Connolly, a spokeswoman for Common Sense Media.
In the Google antitrust probe, Leibowitz concluded that, while some evidence suggested the company was trying to eliminate competition, its “primary reason” for changing the look of search results was to improve user experience.
Google agreed to let websites remove their content from targeted search services such as Google Shopping or Google Local without removing or demoting that content in the main Google search engine. In the consent decree, the company also agreed to limits on when it can seek to block sales of competitors’ products that rely on so-called standard-essential patents.
This is at least the second time Google helped recognize top regulators in the middle of a government probe.
In October 2011, Google reported spending $80,000 to honor Federal Communications Commission Chairman Julius Genachowski and Commissioner Michael Copps, Senate records show.
The FCC announced an investigation of Google’s Street View product in November 2010. It ended the probe in April 2012 after fining Google $25,000 for failing to cooperate with investigators, which drew this admonition from Senate Majority Whip Richard Durbin, an Illinois Democrat, the following month: “How are you protecting our privacy with a $25,000 fine?”