Justice Talks With Rivals, Clients of Yahoo, Google

Justice Department staff reviewing Google Inc.'s online-advertising deal with Yahoo Inc. met this week with customers and competitors and scheduled a final round of meetings with the two companies next week, amid signs the government may be preparing to recommend an antitrust challenge to the deal.

Thomas Barnett, assistant attorney general for antitrust, hasn't made a final decision and still could allow the deal to proceed. But he recently hired a special counsel, the veteran litigator and former Walt Disney Co. Vice Chairman Sanford Litvack. Mr. Litvack has been asked to review evidence and build a case if a decision is made to challenge the deal.

Photo illustration by Getty Images

Last week, authorities in Canada hired David Kent, a Toronto litigator and an antitrust expert, lawyers close to the matter said. Canadian officials declined to comment. A U.S. Justice Department spokeswoman also declined to comment.

Google and Yahoo expect to hear back from the Justice Department by early October, according to people familiar with the matter.

This week, 10 members of Congress weighed in, sending a letter to the Justice Department, expressing concern and urging a careful review.

David Hantman, Yahoo's vice president of global public policy, in a letter Thursday to Rep. Steve Chabot (R., Ohio), a signer of the letter, said the agreement would "in no way result in one company controlling 90 percent of any part of the online advertising market," as critics of the deal had claimed. "In fact, since our plan and intent is to increase our search-advertising share over time -- not cede any of it to Google -- this deal will make us a stronger competitor in search and display advertising."