Google has agreed to pay $500 million (£370m) over 10 years in a major revamp of its structure for ensuring regulatory compliance in a settlement of a legal action that alleged the company was exposing shareholders to antitrust action.

The consolidated derivative litigation, as it is called, originated in 2021 and is led by two Michigan pension funds who along with other plaintiffs accused company executives and directors of endangering the Google’s future through “prolonged and ongoing monopolistic and anticompetitive business practices” that exposed it to regulatory action.

The lawsuit involved Google’s search, ad technology, Android and app distribution businesses, all of which have been the subject of regulatory antitrust lawsuits.

Additional oversight

The preliminary settlement, which names chief executive Sundar Pichai, Google co-founders Sergey Brin and Larry Page and others, requires approval by US District Judge Rita Lin in San Francisco.

Under the deal Google agrees to create a dedicated board committee to oversee regulatory compliance and antitrust risk, reporting directly to the chief executive, and to make reforms allowing employees to identify potential legal risks before they affect the company.

Google parent Alphabet would create a committee at the senior vice-president level to address legal and compliance issues, also reporting to the chief executive, and a compliance committee of Google product team managers and internal compliance experts.

The firm also said it would preserve internal communications, an issue that recurred regularly in its recent antitrust cases, where judges criticised its use of chats that automatically deleted themselves.

Google denied wrongdoing in agreeing to the deal.

“To avoid protracted litigation we’re happy to make these commitments,” the company stated.

The plaintiffs’ lawyers said the actions, which must remain in place for at least four years, amounted to a “comprehensive overhaul of Alphabet’s compliance function” that would mean “deeply rooted culture change”.

Antitrust exposure

The lawyers are seeking up to $80m in legal fees on top of Google’s promised expenditures.

US District Judge Amit Mehta is expected to rule by August in the remedies phase of a trial in which Google was convicted last year of maintaining an illegal monopoly in general search.

In 2023 Google lost an antitrust lawsuit brought by Epic Games related to its Android app distribution business and this year it lost another competition lawsuit related to its advertising tech business.