THIS spring may go down as the most expensive season in Google’s history. On May 24th French prosecutors raided the firm’s Paris office to collect evidence as part of an investigation in pursuit of an estimated €1.6 billion ($1.8 billion) in back taxes. (The firm says it is co-operating fully.) The tech giant also faces two other, more costly legal imbroglios.
As The Economist went to press, a jury in California was deliberating whether Google had used copyrighted material in Android, its mobile operating system, without a licence from the owner, Oracle. If guilty, Google may have to pay the software-maker up to $8 billion in compensation. And the European Commission will shortly announce its decision on whether the firm harms consumers by using its dominance in online search to steer them away from rival shopping-comparison services and towards its own. The commission may hit Google with a record fine of €3 billion. The two cases could jar the technology industry, not just Google’s wallet.
The trial in California is about Java, a programming language developed by Sun Microsystems, a computer-maker taken over by Oracle in 2010. Thinking it was “fair use” (a concept in American law which allows limited free use of copyrighted material), Google copied parts of Java that let bits of software interact.
If Sun had remained independent, Eric Schmidt, now Google’s chairman and once a senior boss at Sun, might have alleviated the tension. But Oracle vigorously defends its property rights. Should it win, life could get more difficult for open-source projects—groups of volunteer developers who collaborate on software and often use the same bits of Java to make their free programs work with the proprietary kind.
The antitrust case could have wider repercussions. If the commission rules against Google, it and other online giants will have to be more careful in dealing with firms that offer competing products and services on their platforms. Google may have to show the most relevant search results prominently, although this would be hard to define and police.
The fines, although they could reach nearly 18% of Google’s revenue in 2015, are less of a worry. The firm holds more than $75 billion in cash. The industry may feel the sting of Google’s regulatory run-ins more than its own investors.