Google's Antitrust Chief Keeps BusyZusha Elinson
June 15, 2009
When Dana Wagner interviewed for the job as Google Inc.'s antitrust lawyer in 2006, he had one question: "Is this really a full-time job?"
The young federal prosecutor had done his homework, googling "Google" and "antitrust," and found virtually nothing. "Do you have enough to keep me occupied, or are there other areas of the law I should be working at?" he pressed.
Google General Counsel Kent Walker reassured him: "I think we'll have enough, and if there's not, we'll find other things for you to do."
Wagner's job is definitely as full-time -- and prime-time -- as it gets. The fresh-faced, 33-year-old lawyer is in charge of defending Google against the increasingly intense scrutiny of antitrust regulators.
In September, the Department of Justice threatened to sue Google over its monopoly on search advertising unless it dropped an ad-sharing deal with rival Yahoo Inc. The DOJ is now probing a settlement that angry critics say gives the search engine a monopoly power over digitizing some out-of-print books. The Federal Trade Commission is investigating whether there's an unsavory tie between Google's and Apple Inc.'s boards. And the DOJ's looking into claims that tech companies like Google agreed not to hire from competitors.
"He has got a tough job because Google's got a big target on its back," observes Daniel Wall, an antitrust partner with Latham & Watkins who represented Yahoo in the ad-sharing deal.
Wagner has never been easily daunted. He was a young chess whiz who finished high school at 16. He graduated top of his class from the University of California, Berkeley, at the age of 20 with a double major in economics and comparative literature before heading to Yale Law School.
Colleagues at the DOJ, where he used to be the youngest San Francisco federal prosecutor, say he was a quick study in both the antitrust department and the U.S. attorney's office. He was seen as a consummate strategist, but defense attorneys never saw him as a hard-boiled prosecutor.
Wagner, with his smarts, affable nature and dorky sense of humor (for this story, he asked more than once not to be made to look like a "goober"), seems in his element at Google. He's a broad-strategy guy, often working with the company's outside antitrust lawyers at Wilson Sonsini Goodrich & Rosati and Cleary Gottlieb Steen & Hamilton.
Latham's Wall, who was cooped up with Wagner and DOJ lawyers working on the Yahoo deal, said the young lawyer grasped the big picture.
"He seems to be always looking beyond the immediate matter to the broader ramifications of what's going on with Google's business," said the 25-year antitrust veteran. "I have been impressed that he takes a broader view of things."
THE GOOD FIGHT?
Observers say that aside from a few confounding missteps, Google's approach to the government's antitrust concerns has been measured. Lately, that's included a charm offensive, led by Wagner, telling the media its side of the story: Google is big (it controls two-thirds of the Internet search market) but not bad.
"They've handled the whole situation very skillfully -- they're doing everything they can to get their point across," observed Gary Reback, a Silicon Valley veteran at Carr & Ferrell who has just penned a book on antitrust law called "Free the Market." "They haven't picked fights, and they've known when to back off gingerly, for the most part."
That's a contrast to Microsoft Corp., antitrust regulators' last big tech target, observers say.
"Microsoft's approach to the problem was, 'We're going to do what we want and we'll hire the lawyers to clean up the mess afterward and everybody be damned,'" said Robert Lande, co-founder of the American Antitrust Institute. "Google is trying to be very much the opposite."
But both Lande and Reback were surprised when Google CEO Eric Schmidt shot back at the recent FTC investigation into overlapping directors at Apple and Google. Schmidt said that resigning from Apple's board hadn't even "crossed his mind" and he pooh-poohed the assertion that Apple and Google are competitors.
Reback said that kind of attitude got Microsoft in trouble with regulators.
"I was surprised by that," he said. "You don't taunt the government."
It's unclear how much Wagner had to do with this decision, since Walker, the general counsel, spoke to reporters on the issue. Wagner reports to Deputy General Counsel Nicole Wong, though he says he has plenty of direct contact with Walker. On the Schmidt issue, he'd only say that the company is "talking to the FTC and doing our best to answer their questions."
With the Yahoo deal, the somewhat sleepy Bush-era antitrust regulators leaped into action, worried that the partnership would let the rivals jack up ad prices. The Justice Department was hours from filing a suit alleging "that Google had a monopoly and that [the advertising pact] would have furthered their monopoly," Sanford "Sandy" Litvack, a Hogan & Hartson partner who worked on the case for the DOJ, told Recorder affiliate The Am Law Daily.
Yahoo was ready to fight, but Google wasn't. Lawyers familiar with those negotiations say Wagner was also insistent that Google would never accept a consent decree to allow the deal to go forward. He wouldn't comment on the negotiations, but said that a consent decree, which allows the government to monitor a deal, would be "a hard pill to swallow" -- and that a fight would have to be well worth it.
"If you are going to have a big public dispute with a regulator, it should be over something that's very important to you as a business," Wagner said, "and where you have a very strong pro-user, pro-partner message where you're really wearing the white hat and they're in the wrong -- otherwise you'd have to think very carefully about it."
DRUGS AND CRIMINALS
As a prosecutor, Wagner was seen at once as a sure success and an awkward fit.
His supervisor, Marc Siegel, who's now the director of criminal enforcement in antitrust, said Wagner was something of a prodigy.
"As soon as he arrived here, you could tell he was destined for big things," Siegel said. "He was always the youngest guy in the room."
But Robert Waggener, a criminal defense lawyer, said Wagner never fit the profile: "I always thought he shouldn't be a prosecutor -- too nice a guy."
Waggener represented a Mexican woman who worked at a pot-growing operation. He said Wagner prosecuted the case well, but he could see his heart wasn't in it.
"Dana was the sort of guy, he was a good soldier, he had marching orders, but you got the idea that he wasn't necessarily happy with what was going on," Waggener said.
Wagner agreed, saying, "Without going into my personal views on marijuana laws, sometimes it's clear to the defense attorney that this is a guy who doesn't think the book should be thrown at the client for a marijuana offense, but he's got this statute and he's constrained by it."
Wagner worked on white collar, organized crime and drug cases, and though he's now dealing with the department's civil side, Siegel said the DOJ experience helps.
"I always think it's good for defense counsel to have a good relationship with the government," he said. "In this business, your word is everything."
Wagner said he always felt better about the white-collar cases, putting executives away who "chose to break the law out of pure greed."
Yet now he works for one of the corporate world's biggest success stories -- but he insists he wouldn't be an antitrust lawyer for just any company.
"I wouldn't be a competition attorney for Halliburton, right?" Wagner said. "Google's not intrinsically a public-interest corporation, but they care a lot about doing the right thing and their competition philosophies are very sound and good for consumers."