B4| Friday, September 13, 2019 ** THE WALL STREET JOURNAL.
TECHNOLOGY WSJ.com/Tech
Mr. Hood, whose probe had
drawn support from other
state attorneys general,
dropped his subpoena, al-
though his battles with Google
have continued on other
fronts.
Eric Goldman, a Santa Clara
University law professor and
co-director of the High Tech
Law Institute, cited Google’s
lawsuit against Mr. Hood as
“an example of Google’s will-
ingness to fight if it feels it
has to.”
He described the subpoena
from the Texas attorney gen-
eral as overreaching and “afishing expedition,” although
more targeted than the Missis-
sippi investigation a few years
ago.
Scott Cleland, founder of
Precursor Research LLC, an in-
dependent investment-re-
search boutique specializing in
internet regulation, said:
“Google has no peer in slow-
rolling and minimizing gov-
ernment accountability with a
smile; it’s a core competency.”
Google also has battled
with state attorneys general
over the scope of federal legal
protections for online plat-
forms.The company’s share of the U.S. digital-ad market will be 37% this year.JUSTIN SULLIVAN/GETTY IMAGESThis year, Google’s share of
the total U.S. digital-ad market
will be 37%, according to
eMarketer, a research firm.
The subpoena was sent
Monday, the same day that 50
attorneys general announced
their antitrust investigation
that is being led by Texas. The
Wall Street Journal reviewed a
copy Thursday through a pub-
lic records request.
While Google has pledged
to cooperate with the probe,
some legal observers believe
Google could feel compelled to
start fighting back at some
point if it believes the investi-
gation is overreaching. When
Mississippi’s attorney general,
Jim Hood, sent a broad sub-
poena to Google a few years
ago, the company responded
with a federal lawsuit seeking
to quash the effort.
Google initially secured an
injunction to block Mr. Hood’s
investigation. A federal ap-
peals court eventually sided
with the Mississippi attorney
general, but not before Google
had tied up the state investi-
gation for months.Continued from page B1Digital
Ads Under
Scrutiny
Chip makerBroadcomInc.,
hard hit by U.S.-China trade
tensions and export restrictions
toHuawei TechnologiesCo.,
on Thursday said it believes its
core semiconductor business
has bottomed out but isn’t
quite in recovery mode yet.
Chief Executive Hock Tan,
speaking during a conference
call with analysts, said he is
confident the bottom of the
down cycle has been reached
but said it is too early to speak
of a turnaround.
“We are managing the busi-
ness with an expectation that
we will continue to operate in a
very low growth, uncertain
macro environment for the
foreseeable future,” Mr. Tan
said.
Broadcom maintained a rev-
enue target of $22.5 billion for
the year ending Nov. 3, includ-
ing $17.5 billion from semicon-
ductor solutions and $5 billion
from infrastructure software.
Huawei, blacklisted by the
U.S. over national-security con-
cerns, accounted for around
$900 million, or 4.3%, of reve-
nue last year.
Apple Inc. is Broadcom’s
largest customer and accounted
for about one-quarter of reve-
nue last year.
Mr. Tan, who built Broadcom
through a series of acquisitions,
last month struck a roughly
$10.7 billion deal to buy Syman-
tec Corp.’s enterprise-security
business. The deal, along with
the 2017 acquisition of Brocade
Communications Systems Inc.
and the 2018 acquisition of CA
Technologies are part of a big
and costly bet around infra-
structure software.
Executives said the company
would maintain its dividend
policy of paying investors half
of its free cash flow from the
previous fiscal year but would
focus on paying down debt,
rather than repurchase shares.
The company reported third-
quarter profit dropped to $715
million, or $1.71 a share, from
$1.2 billion, or $2.71 a share, a
year earlier, as operating ex-
penses surged 69% to $2.17 bil-
lion.BYMARIAARMENTALBroadcom
Says Chip
Rebound
Not Ready
higher-ups for permission—on
topics such as workplace diver-
sity and compensation, regard-
less of whether Google views
such topics as inappropriate for
the workplace.
The settlement was ap-
proved by an agency director
this week, according to a docu-
ment. It is slated to go into ef-
fect after an appeals period.
The NLRB action is the sec-
ond formal reminder to Google
in a week to stay within the
law. Last week, Google’s You-
Tube unit settled an investiga-
tion into alleged violations of
child-privacy law with a $170
million fine and an admonish-
ment from regulators not to
track the internet activity of
children under age 13.
Google, a unit ofAlphabet
Inc., also is in the early days of
separate investigations from
the Justice Department and a
group of state attorneys gen-
eral into its dominant online
advertising platform.
Private employers have the
ability to limit certain speech in-
side their workplaces, and
Google has done so indepen-dently of the NLRB investigation.
Late last month, Google moved
to prune office debates among
its more than 100,000 full-time
employees, adding guardrails for
discussions of nonwork topics
and encouragement to avoid po-
tentially disruptive conversa-
tions. Among the new rules:
“Discussions that make other
Googlers feel like they don’t be-long have no place here.”
Federal law protects activity
like forming a union and conver-
sations about improving pay,
among other types of conduct.
Still, current and former em-
ployees have said Google has
overreached, or at times not
done enough to protect their
speech inside the workplace.
The NLRB settlement saysGoogle must actively notify
employees that the search gi-
ant killed rules that clamped
down on employees sharing
certain confidential informa-
tion with one another, or with
the media. The settlement
doesn’t spell out exactly what
those rules covered.
Right-leaning employees say
that expressing their beliefs
can make them lepers among
Google hiring managers, while
left-leaning staff have been
stymied in attempts to protest
YouTube’s evolving policies on
hate speech, among other is-
sues. Some of the more outspo-
ken staffers were later offered
pay packages to leave the com-
pany, these staffers say.
One complainant, ex-Google
engineer Kevin Cernekee, has
said he was fired for express-
ing unpopular right-leaning po-
litical beliefs to fellow employ-
ees on the company’s
freewheeling internal message
boards. Google says he was
fired for misusing company
equipment. President Trump
tweeted support for Mr. Cerne-
kee after The Wall Street Jour-nal wrote about the former
employee’s allegations of bias
last month.
In a statement, a Google
spokeswoman said, “Under the
settlement, we have agreed to
post a notice to our employees
reminding them of their
rights.” The other complainant,
a current employee whose
identity remains private, al-
leges he was punished for
posting unflattering opinions
about a high-level Google exec-
utive on a Facebook page.
The NLRB’s settlement is a
victory for Google in that it
doesn’t make a formal determi-
nation about whether Google
was in the wrong. Mr. Cerne-
kee had asked to be reinstated,
with back pay. He will receive
neither under the settlement
terms.
The NLRB is ordering
Google to withdraw Mr. Cerne-
kee’s final warning letter,
which said he had violated the
company’s code of conduct. At-
torneys for the complainants
objected in writing to the set-
tlement, saying they deserve a
hearing to air their views.Federal regulators have or-
dered Google to assure employ-
ees they are allowed to speak
out on political and workplace
issues, people familiar with the
matter said, as part of a settle-
ment of formal complaints that
the search giant punishes those
who do just that.
The National Labor Relations
Board’s move offers Google an
escape hatch from a thorny issue
that has roiled the business in
recent years. Though Google ex-
ecutives have long bragged
about having a workplace culture
designed to encourage open de-
bate, current and former em-
ployees across the political spec-
trum have complained that they
were retaliated against for rais-
ing concerns about equality and
freedom of speech.
The NLRB’s settlement comes
in response to a pair of com-
plaints about Google’s reaction
to workplace dissent. The settle-
ment orders Google to inform
current employees that they are
free to speak to the media—
without having to ask GoogleBYROBCOPELANDGoogle Told to Let Workers Speak
Workers in San Francisco protested the company’s handling of sexual-misconduct allegations against certain executives, in an employee walkout lastyear.ERIC RISBERG/ASSOCIATED PRESS
Settlement doesn’t
make determination
if search engine was
wrong.Pact to Pay France
$1.1 Billion Is SetGoogle is paying more than
$1 billion in fines and back taxes
to settle a pair of tax disputes
in France, where it has faced
years of investigations into
whether it has properly declared
all of its activity in the country.
France’s financial prosecutor
said a court hasapproveda
€500 million (about $550 mil-
lion) fine theAlphabetInc. sub-
sidiary agreed to in a settle-
ment of a tax-related criminal
probe. The prosecutor has beeninvestigating Google for aggra-
vated tax evasion since 2015,
after a complaint from the
French tax authority related to
the four previous years.
Google confirmed the agree-
ment, and said it had previously
agreed to pay €465 million in
back taxes to France’s tax au-
thority, which has for years ar-
gued that it was underpaying.
The settlements, which
prosecutors said were related,
were a surprise because a
French court two years ago
threw out an earlier €1.11 billion
tax bill that the tax authority
had issued the company for the
years from 2005 to 2010. Inthat bill, the tax authority had
alleged that Google had de-
clared too little revenue and
profit in France.
But Google says it wanted
to settle its pending cases and
move forward. “We have now
settled tax and related disputes
in France that have persisted
for many years,” a Google
spokesman said, adding that
the prior settlement with the
authority was already substan-
tially reflected in Alphabet’s re-
sults.
The settlements amount to
2.9% of Alphabet’s revenue last
quarter.
—Sam Schechner
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