By Greg Bensinger
SAN FRANCISCO (Reuters) -Alphabet CEO Sundar Pichai acknowledged in federal court on Tuesday that he sometimes marked documents as "privileged" and never turned off a setting that caused internal chats to delete automatically after one day.
Pichai was in court in San Francisco to defend Alphabet (NASDAQ:GOOGL)'s Google from a lawsuit by Epic Games that alleges its app store policies amount to an illegal monopoly and have caused consumers to pay artificially high prices.
Attorneys for Epic Games, maker of the wildly popular "Fortnite" game, appeared to be trying to establish that Pichai and Google were concealing sensitive communications that could later be used against it in a potential trial.
Jurors were shown an internal Google document reminding employees that "anything you write can become subject to review in legal discovery" as well as one of Pichai's chat histories where he requested that history be turned off, meaning messages would be erased.
“I supported all recommendations from our legal and compliance team,” Pichai said during roughly an hour of testimony led by Epic's lawyer. He largely stuck to one-word answers but was occasionally admonished by Epic Games' attorney for straying beyond simple answers.
Pichai, in examination by a Google attorney, denied he had ever tried to keep any document hidden from a lawsuit. He said he used the term "privileged" on documents to indicate "confidential" not necessarily subject to attorney-client privilege.
But he later acknowledged, under questioning from the judge, that since 2008 Google largely left it to employees to determine if their chats could be relevant to litigation. He said that policy was revised recently.
Epic Games has alleged in its lawsuit that app store policies amount to an illegal monopoly and have caused consumers to pay artificially high prices. The company wants it to be easier for Google Play users to access third-party app stores and additional payment processors for in-app purchases.
For its part, Google has said changing its systems would cause its Android-based app store to be less secure and damage its ability to compete with Apple (NASDAQ:AAPL). Epic’s similar lawsuit against Apple resulted in a ruling largely that was mostly favorable to Apple – both companies appealed to the U.S. Supreme Court.
Epic filed the case against Google in 2020 after “Fortnite” was removed from the app store after the Cary, North Carolina, company enabled customers to pay it directly, circumventing Google’s payment systems, which allow it to take a percentage of each transaction.
If jurors find for Epic it could radically alter the app store business, in which Google and Apple exert exclusive control of what apps are available to consumers and take a cut of roughly 30% of in-app purchases and paid downloads.
Google has settled claims over its app store with dating app maker Match Group (NASDAQ:MTCH) and from U.S. consumers and U.S. states. Google is also facing an antitrust trial over the U.S. government’s allegations about its search dominance and is expected to have to defend itself at trial next year over its policies on digital advertising.
Separately, Pichai confirmed that Google pays Apple 36% of search revenue on iOS in order to be the default search engine, a figure that leaked on Monday in Google's antitrust trial under way in federal court in Washington, D.C.
The payments to Apple have been central to the Justice Department's case.