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Google and Fitbit proudly announced yesterday that their $ 2.1 billion acquisition has been finalized after months of regulatory review. Unfortunately for this deal, however, it may still run into legal issues as Google did not wait for approval from the United States Department of Justice (DOJ) or Australian regulators before finalizing the buyout of Fitbit.
Between the November 2019 announcement and the apparent close yesterday, Google has faced several inquiries regarding the deal. The most important was that of the EU, which gave its approval at the end of December. The DOJ also had an ongoing investigation, but never gave Google approval until yesterday’s announcement.
Ryne Hager from Android Police understood how Google was able to get around this problem. The DOJ only had a specific deadline to give its approval or disapproval of the deal, but that deadline passed without a final response. As a result, Google simply went ahead given the lack of a yes or no. At this point, it’s unclear whether the US DOJ will take legal action against Google and Fitbit.
A Google spokesperson said of the DOJ investigation:
We have complied with DOJ’s extensive review over the past 14 months, and the agreed upon waiting period has expired without their objection. We keep in touch with them and we promise to answer any additional questions. We are confident that this agreement will increase competition in the crowded portable device market, and we have made commitments that we plan to implement globally.
Where Google really jumped the gun was in Australia. There, the Australian Competition and Consumer Commission was still conducting a public inquiry into the deal slated for March of this year. The ACCC had cited competition concerns as the reason it was trying to block the deal, fearing Google would “oust” Fitbit rivals. Of course, this statement essentially ignored Apple’s monopoly in the iOS portable device market.
At this point, the ACCC is considering an “enforcement investigation” that could lead to legal action regarding the Fitbit and Google deal.
As the transaction was completed on January 14, 2021, before the ACCC completed its investigation, this matter became a completed merger enforcement investigation. No further update of the investigation will be made on this public registry.
In a statement to Android Police, ACCC further says:
“Google’s decision to acquire Fitbit before we complete our merger review means that we are currently conducting an enforcement investigation. Accordingly, and based on the results of our investigation, we will consider whether to take legal action on this matter, ”said ACCC President Rod Sims.
In December, the ACCC decided it would not accept a long-term behavioral commitment offered by Google that aimed to address competition concerns because of the significant difficulties in effectively monitoring and enforcing the commitment.
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