Judge dismisses Chegg's and Penske's AI Overviews cases: an expectation is not an agreement

A federal judge has dismissed the antitrust cases that Chegg and Penske Media brought against Google over AI Overviews, and one line carries the ruling. "But an expectation is not an agreement," Judge Amit P. Mehta wrote of the search traffic the publishers said they were owed. "It is simply how a general search engine works."

Google's own title card for an earlier Gemini release. The opinion names AI Overviews and Gemini as the two generative products at issue. Image: Google

The 41-page memorandum opinion, signed on September 30 in the US District Court for the District of Columbia, grants Google's motions to dismiss in both actions in full. Chegg sued over educational content, Penske Media over titles including Rolling Stone, Billboard, Variety, The Hollywood Reporter and Deadline, and both argued that Google uses its search monopoly to make publishers hand over their work free for snippets, AI Overviews and Gemini.

Without an agreement there is no reciprocal dealing

Both complaints rest on reciprocal dealing: the claim that Google conditions the sale of search referral traffic on publishers supplying content for nothing. Under Section 1 of the Sherman Act that requires a "meeting of the minds", and the court says the publishers pleaded none.

They "allege no communications between Plaintiffs and Google from which mutual assent to engage in a transaction could plausibly be inferred", the opinion says, and no negotiated quantity, duration or exclusivity. What they pleaded instead was an expectation of traffic.

The same gap sinks reciprocal dealing under Section 2, because it "is, by definition, a two-sided practice" that presupposes a dealing relationship. Google's other three wins each rest on different ground. The monopoly maintenance counts go because the publishers have not pleaded antitrust standing in general search, where their alleged injuries are at most "incidental" or a "byproduct" of Google's conduct. Penske Media's tying claim goes because Google Search and AI Overviews are not plausibly separate products "as opposed to an integrated search experience". The attempted monopolisation and leveraging counts go because the publishing markets they depend on were not plausibly defined, Penske Media's "Online Publishing" market, covering essentially all digital text, being "implausibly overbroad".

The unjust enrichment claims were never decided

With every federal claim gone, the court declined to exercise supplemental jurisdiction over the state law unjust enrichment counts under 28 U.S.C. 1367(c), dismissing Chegg's Count VI and the Penske plaintiffs' Count VII without reaching their merits. California law would have governed them.

This is a dismissal at the pleading stage, not a finding that AI Overviews are lawful in every respect. The court took the publishers' factual allegations as true throughout, as it must on a motion to dismiss, and still found no claim it could hear. "A final, appealable order accompanies this Memorandum Opinion", the opinion says, so an appeal is open to both sets of plaintiffs.

Mehta points publishers at Congress instead

The judge set the limit out himself. "The court does not treat Plaintiffs' alleged harms lightly," he wrote. "Nor is it unsympathetic to the situation publishers now find themselves in, and the knock-on consequences to journalists, educators, and other online creators whose content Google takes and repurposes without compensation."

The antitrust statutes, he continued, are not "in any sense a substitute for [a] legislative body addressing questions of . . . economic dislocation caused by new innovation", and to the extent the case highlights any deficiency in the law, "that is an issue for Congress [or regulators] to consider".

The court accepted the publishers' description of the squeeze as true for the motion, and after this ruling it remains an allegation. On their account, AI Overviews are "AI-powered snapshot[s] in response to user queries", sometimes "a machine-made essay consisting of multiple paragraphs" built from the same publisher content a reader might otherwise have visited, and they can paraphrase results "without linking those sources in the AI Overviews panel". Blocking snippets to escape that is, they say, "a Hobson's choice", because "[v]irtually no digital publishers can afford to take such drastic action".

Antitrust is one front of several. In the copyright courts, which turn on entirely different law, news publishers have asked a judge to reject OpenAI's fair use defence. Mehta rejected a near-identical antitrust theory on March 20, in Helena World Chronicle v. Google, and says the publishers gave him no persuasive reason to change course. The remedy he names for them is not the Sherman Act.