Robert Besser
06 Jun 2025

MOUNTAIN VIEW, California: To settle a major shareholder lawsuit, Google is writing a US$500 million check — not for damages, but to overhaul its compliance systems.

The technology giant has agreed to spend that amount over 10 years to revamp its handling of legal risk, according to a preliminary settlement filed late last week in U.S. District Court in San Francisco. The deal is part of a derivative lawsuit targeting officials at Google parent Alphabet, including CEO Sundar Pichai and co-founders Larry Page and Sergey Brin.

The litigation, led by two Michigan pension funds, accused Alphabet's leadership of breaching fiduciary duties by exposing the company to antitrust liability in areas like its search engine, ad technology, Android, and app distribution.

As part of the settlement, Alphabet will establish a dedicated board-level compliance committee, separate from its audit board. A new senior executive committee reporting to Pichai will also be created to oversee regulatory risk. In addition, Google will form a compliance group made up of internal experts and product team leads.

"Over the years, we have devoted substantial resources to building robust compliance processes," Google said in a statement Monday. "To avoid protracted litigation, we're happy to make these commitments." The company denied any wrongdoing.

The compliance reforms must stay in place for at least four years. Shareholders won't receive direct compensation, but their attorneys plan to seek up to $80 million in legal fees.

"These reforms, rarely achieved in shareholder derivative actions, constitute a comprehensive overhaul of Alphabet's compliance function," the shareholders' lawyers wrote, calling it a "deeply rooted culture change."

Patrick Coughlin, a lawyer for the plaintiffs, said the board failed to act on early warnings of antitrust exposure. "There are things it could have done, and should have done, earlier," he said.

The deal was disclosed the same day another federal judge, Amit Mehta, wrapped up hearings on how to remedy Google's monopoly in search following a landmark ruling last August. The U.S. Justice Department has proposed forcing Google to sell its Chrome browser and share search data with rivals.