Google's "Don't Be Evil" mantra gets more ironic by the minute. The Federal Trade Commission is reportedly due to slap the search giant and its leaders with a subpoenas this week as part of an antitrust investigation. The mere mention of "antitrust" and the FTC sparks flashbacks to the Microsoft debacle over a decade ago or even the massive lawsuit in the 1970s that led to the breakup of AT&T. Then, presumably a direct result, Consumer Watchdog sent a letter to the White House on Thursday demanding the president distance himself from Google and stop inviting Eric Schmidt to galas. Whether or not the administration is actually condoning preferential treatment for Google as the watchdog group insinuates, the swirl of accusations don't look particularly good for either party.
Consumer Watchdog points to one thing in particular: The White House invited Schmidt and Google vice president Marissa Mayer to attend the most recent state dinner, when the company was under criminal investigation by the Department of Justice. From Consumer Watchdog's letter:
As you may know, Google is under criminal investigation into allegations that it profited from selling online ads to illegal pharmacies. These illicit pharmacies may violate U.S. law by peddling expired or counterfeit prescription medication, or selling medicine without a physician's prescription. Before the State Dinner Google had begun negotiating a settlement of the charges and had filed notice with the Securities and Exchange Commission that it was setting aside $500 million – roughly one-sixth of its 2011 first-quarter revenue – to resolve the case. This is no minor matter.
Scolding the White House for "an inappropriate conflict of interest" is old hat for Consumer Watchdog, but the circumstances are especially embarrassing for Obama. Consumer Watchdog frames its complaint as an administration thing, pointing out how Eric Holder could have been more diligent in handling the prescription drug ad investigation, but the letter can also be read as an attack on Obama's longstanding friendship with Eric Schmidt.