On June 2, 2025, Alphabet Inc., Google’s parent company, announced a preliminary settlement in a shareholder derivative lawsuit, agreeing to invest at least $500 million over the next decade to overhaul its global compliance systems. The lawsuit, filed in 2021 by Michigan pension funds, alleged that Google executives breached their fiduciary duties by failing to disclose antitrust risks related to the company’s dominance in online search, advertising technology, Android, and app distribution. The settlement, which requires approval from U.S. District Judge Rita Lin in San Francisco, aims to resolve these claims without the company admitting wrongdoing.
As part of the settlement, Alphabet has committed to establishing a standalone board committee dedicated to overseeing regulatory issues and compliance matters. Additionally, a new senior executive committee will be formed to address regulatory and compliance issues, reporting directly to CEO Sundar Pichai. A compliance committee consisting of Google product team managers and internal compliance experts will also be created. These reforms are set to remain in place for at least four years. The shareholders involved in the lawsuit will not receive monetary compensation; however, their lawyers plan to seek up to $80 million in legal fees and expenses.
This settlement comes amid heightened scrutiny of major tech firms by regulators worldwide, as governments seek to address concerns over market concentration and consumer privacy. The U.S. Department of Justice has previously found Google to have violated federal antitrust laws to maintain dominance in the search market. The settlement’s proposed compliance reforms are seen as a significant transformation in Alphabet’s compliance culture, aiming to prevent future legal and regulatory challenges.
The outcome of this settlement may have broader implications for other tech companies facing similar regulatory scrutiny. It underscores the growing importance of robust compliance structures and transparency in addressing antitrust concerns in the tech industry. As the legal landscape continues to evolve, companies may increasingly be held accountable for their market practices and their impact on competition and consumers.
