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People walk near the Google offices on July 04, 2022 in New York City.

John Smith | View Press | Getty Images

Google‘s parent company Alphabet has stacked its legal team with former Department of Justice employees as it fights two separate antitrust lawsuits from the agency, public profiles show.

Former DOJ employees make up both its in-house team and members of outside counsel firms it employs. The company has hired three former DOJ officials into regulatory roles since May 2022, and one before that in 2021, according to public information including social media profiles. Google also uses four different outside counsel firms loaded with nearly 20 former DOJ officials, many of whom worked in the Antitrust Division at various times.

Such hiring to its internal regulatory team is a reflection of the intense scrutiny Google is facing from governments around the world. It can be a signal that a company anticipates dealing with regulatory challenges in years to come, even if it doesn’t know exactly what form it’ll take yet, according to two former government officials.

“When companies find themselves under intense scrutiny from regulatory authorities, antitrust law or otherwise, they make moves like this,” said Bill Kovacic, a former Federal Trade Commission chair who now teaches antitrust law at George Washington University.

Google now faces two antitrust challenges from the DOJ, both to its search and ad tech businesses, and additional challenges from a slew of state attorneys general. Regulators around the world, including in Europe and Australia, have also presented policy and enforcement hurdles.

Google’s hiring is not surprising for a company under such a microscope, according to Doug Melamed, a former acting assistant attorney general at the DOJ Antitrust Division who’s now a scholar-in-residence at Stanford Law School.

The company had already been fighting one complex antitrust case that would likely require a team of 10 to 15 lawyers alone, according to Melamed, when the Department brought its second antitrust challenge against the company earlier this year.

“They don’t have the capacity to handle a case like that just sitting idle,” Melamed said. “They’ve got to now think about well, what outside lawyers are available that have to have the time and expertise to handle this case? And then, do I have the in-house capability to support it and supervise it?”

The added threat of new legislation targeting Google’s business, and that of other tech firms, looms. In the near term, it appears that a massive lobbying campaign by the industry has successfully delayed the most disruptive reforms. But the possibility of renewed energy around that legislation still hangs over the industry, and a company like Google “can take nothing for granted now,” Kovacic said, adding that’s likely a reason for the company to build out its regulatory forces.

“New entrants and new innovations are driving competition and delivering value for America’s consumers, publishers, and merchants,” a Google spokesperson said in a statement for this story. “We’re proud of our services and we look forward to making our case in court.”

Revolving door hiring

Alphabet now has at least five former DOJ staffers on its legal team, including Google’s director of competition Kevin Yingling, who’s been with the company for more than a decade and worked as a trial attorney at the Department of Justice from 2000 to 2005, according to his LinkedIn.

The company hired Kate Smith as counsel for Alphabet’s regulatory response, investigations and strategy unit in February 2021, according to LinkedIn. Smith was a trial attorney in the DOJ’s Civil Frauds division from September 2015 until January 2021.

In May 2022, according to LinkedIn, Alphabet hired Mike Kass, a former trial attorney in the DOJ’s Civil Fraud section, as its regulatory and litigation counsel for products.

A month later, the company hired Seema Mittal Roper as counsel on its regulatory response team. Mittal Roper worked as an assistant U.S. attorney for the DOJ in Maryland from 2013 to 2018, according to LinkedIn.

Most recently, the company hired Jack Mellyn as strategy counsel on its regulatory team. Mellyn was previously an attorney advisor and then acting assistant chief in the DOJ’s competition policy and advocacy section, according to a previously available social media profile.

It’s not clear which employees are working on the specific matters before the DOJ and Kass’ role appears focused outside of antitrust. It’s likely these employees never worked on Google-related matters they’re dealing with now during their time in government, given their dates and areas of previous employment, as well as federal ethics rules that bar certain conflicts.

But experts say this kind of hiring, which is common among businesses faced with regulatory scrutiny, can still be beneficial to a company because of the unique insight, touch or credibility that an ex-government attorney might hold when it comes to their former colleagues.

“There are lots of lawyers out there. But only alumni of an office really understand how that office works,” said Jeff Hauser, executive director of the Revolving Door Project, which tracks the business ties of executive branch officials. “That means its strengths and weaknesses, that means the tendencies of people in that office. And they can therefore give much more concrete intelligence and better-informed advice to their client.”

Hauser said this may mean the lawyers could advise a client or employer to flood the agency with information rather than comply with a certain document request, knowing that the enforcers don’t have the capacity to deal with it. Or, they might suggest strategies to approach a deposition, knowing the government staffer conducting it.

A lawyer who’s had experience in the government doesn’t bring information about the specific matters of the companies involved, but rather brings a general perspective about how the agency is approaching these kinds of problems,” Melamed said.

Enforcement agencies also often have to trust whether they believe the target of an investigation has complied with its requests. Hauser said the agencies may be more inclined to take the word of their former colleagues, compared to a more removed attorney.

A recent event shows what can happen when that trust is broken. The DOJ last month accused Google of destroying chat messages it should have kept under a litigation hold related to the investigation. The DOJ made the accusation in a legal filing after Epic Games raised the concern in its own antitrust litigation against Google.

A Google spokesperson said in a statement at the time of the DOJ’s filing that they “strongly refute the DOJ’s claims.”

Google also works with outside counsel firms on its antitrust cases, including Axinn, Freshfields, Ropes & Gray and Wilson Sonsini, based on reports, statements and legal filings. Those firms collectively have around 20 former DOJ employees on their staff, many of them working in antitrust. Though these attorneys may not all work on Google matters, the firms themselves often tout the benefit of former government officials in bringing a helpful perspective to clients.

For example, Freshfields says on its website that its “deep bench of former DOJ and FTC trial attorneys gives us unique insight into how the enforcement agencies approach enforcement in general and litigation in particular.”

Kovacic said agency experience is something companies look for in hiring outside firms.

“In deciding who to retain, what law firm to retain or what economic consultancy to retain, they would place a lot of weight on how many former government officials are in those firms,” Kovacic said.

Freshfields attorneys Julie Elmer and Eric Mahr have led Google’s defense against an advertising technology monopolization case brought by a group of states led by Texas, The New York Times reported in 2021. And Bloomberg Law reported this year that Mahr will also lead its defense in the ad tech case brought by the DOJ.

Mahr was director of litigation for the DOJ Antitrust Division from 2015 to 2017, according to the Freshfields site, and Elmer worked as a trial attorney in the Antitrust Division from 2015 to 2020, according to her LinkedIn profile.

Revolving door hiring goes both ways between the public and private sectors, with government officials often working for previous employers or clients who become relevant in their work. For example, DOJ antitrust chief Jonathan Kanter previously worked for clients including Microsoft and Yelp which have complained of Google’s allegedly anticompetitive behavior.

Ultimately, however, Kanter was cleared to work on cases and investigations involving Google, despite the company’s suggestion that his past work should cast doubt on his ability to be fair in such matters.

The DOJ and Wilson Sonsini declined to comment. The three other firms mentioned did not immediately provide a comment for this story.

Limits for former government employees

There are limits on what former government officials can work on under federal ethics and Bar rules.

For example, the DOJ’s website says that former employees can’t represent someone before the government on an issue involving parties they “personally and substantially” worked on during their time in government. For two years after leaving the Department, a former employee also cannot represent anyone before the government in a matter involving parties they know “was pending under his official responsibility for the last year of government service and in which the U.S. is a party or has a substantial interest.”

And for one year after leaving the agency, former senior employees cannot represent someone before the agency “with the intent to influence” the DOJ on a pending matter or one in which it has an interest.

Personal and substantial work on a matter within government doesn’t depend on the length of time devoted to it, but the role a person played in potentially influencing the outcome or direction, according to Virginia Canter, the chief ethics counsel at Citizens for Responsibility and Ethics in Washington (CREW) who previously advised government officials on ethics at agencies including the Securities and Exchange Commission and the Treasury Department.

But even if a former government official can’t work on a specific matter they were privy to during their earlier employment, their insight might still be useful to a company.

“You can read about it, but when you’re actually part of dealing with these cases, you know that there are certain factors that are going to either act as mitigating or … that are going to more favorably incline you to bring a case,” Canter said. “It’s just your general knowledge and experience.”

When companies hire former government officials, they may also have the idea that those employees will be viewed more favorably by the current regime.

“Maybe there’s just this general impression that they’re trying to surround themselves with what will be perceived by their former colleagues as the good guys,” Canter hypothesized.

Some might argue that experience could be beneficial to the government in some cases, Canter noted. A former government employee might have a deeper understanding of the importance of compliance or providing certain information to officials, for example, having seen up close what could be at stake if they don’t.

Hauser said it’s unlikely DOJ leadership, especially Kanter, who has made a point to bring more aggressive cases in the tech space and overall, would be overly swayed to view things Google’s way in ongoing matters. But, he said, the impact of former DOJ staff employed by Google could be more influential in an emerging issue, where there’s an opportunity to leave a first impression on senior leadership about it.

The degree of this kind of influence may be relatively small on the level of an individual case, Hauser said, but for a company under such a high degree of regulatory scrutiny, it could add up.

“You’re talking about billions and billions of dollars of potential implications for Google’s net worth,” Hauser said. “Relatively small changes in the scope of the investigation, the timeframe of the investigation, can be very big, even if they don’t go to the overall question of will there be any lawsuits by the Justice Department against Google.”

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Tesla launches refreshed Model Y in China to fend off domestic rivals

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Tesla launches refreshed Model Y in China to fend off domestic rivals

Tesla launched a revamped version of its Model Y in China.

Tesla

Tesla on Friday announced a revamped version of its popular Model Y in China, as the U.S. electric car giant looks to fend off challenges from domestic rivals.

The Model Y will start at 263,500 Chinese yuan ($35,935), with deliveries set to begin in March. That is 5.4% more expensive than the starting price of the previous Model Y.

A spokesperson for Tesla China said that the new Model Y is only open for pre-sale in the Chinese market, rather than being launched globally.

Tesla’s Model Y refresh comes after the auto giant this month reported its first ever annual decline in overall deliveries for 2024.

Elon Musk’s electric vehicle firm is facing heightened competition around the world, from startups and traditional carmakers in Europe. In China, the company continues to face an onslaught of rivals from BYD to newer players like Xpeng and Nio.

Jason Low, principal analyst at Canalys, notes that the Tesla Model Y was the best-selling EV in China in 2024 and that the popularity of the car “remains high.” However, he noted that the competition in the sports utility vehicle (SUV) segment with vehicles priced between 250,000 yuan and 350,000 yuan “has been fierce.”

“Tesla must showcase compelling smart features, particularly a unique but well localized cockpit and services ecosystem,” as well as “effective” semi-autonomous driver assistance features “to ensure its competitiveness in the market,” Low added.

Tesla is offering a number of incentives for customers to buy the Model Y including a five-year 0% interest financing plan.

The new Model Y can accelerate from 0 kilometers per hour to 100 kilometers per hour in 4.3 seconds, Tesla said, exceeding the speed capabilities of the previous vehicle. The Model Y Long Range has a further driving range on a single charge versus its predecessor.

Tesla has not introduced a new model since it began delivering the Cybertruck in late 2023, which starts at nearly $80,000.

Investors have been yearning for a new mass-market model to reinvigorate sales. Tesla has previously hinted that that a new affordable model could be launched in the first half of 2025.

Despite Tesla’s headwinds, the company’s stock is up nearly 70% over the last 12 months, partly due to CEO Musk’s close relationship with U.S. President-elect Donald Trump.

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World’s biggest chipmaker TSMC posts record 2024 revenue as AI boost continues

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World's biggest chipmaker TSMC posts record 2024 revenue as AI boost continues

The logo for Taiwan Semiconductor Manufacturing Company is displayed on a screen on the floor of the New York Stock Exchange on Sept. 26, 2023.

Brendan Mcdermid | Reuters

Taiwan Semiconductor Manufacturing Co. posted December quarter revenue that topped analyst estimates, as the company continues to get a boost from the AI boom.

The world’s largest chip manufacturer reported fourth-quarter revenue of 868.5 billion New Taiwan dollars ($26.3 billion), according to CNBC calculations, up 38.8% year-on-year.

That beat Refinitiv consensus estimates of 850.1 billion New Taiwan dollars.

For 2024, TSMC’s revenue totaled 2.9 trillion New Taiwan Dollars, its highest annual sales since going public in 1994.

TSMC manufacturers semiconductors for some of the world’s biggest companies, including Apple and Nvidia.

TSMC is seen as the most advanced chipmaker in the world, given its ability to manufacture leading-edge semiconductors. The company has been helped along by the strong demand for AI chips, particularly from Nvidia, as well as ever-improving smartphone semiconductors.

“TSMC has benefited significantly from the strong demand for AI,” Brady Wang, associate director at Counterpoint Research told CNBC.

Wang said “capacity utilization” for TSMC’s 3 nanometer and 5 nanometer processes — the most advanced chips — “has consistently exceeded 100%.”

AI graphics processing units (GPUs), such as those designed by Nvidia, and other artificial intelligence chips are driving this demand, Wang said.

Taiwan-listed shares of TSMC have risen 88% over the last 12 months.

TSMC’s latest sales figures may also give hope to investors that the the demand for artificial intelligence chips and services may continue into 2025.

Foxconn, which assembles Apple’s iPhones, reported its highest-ever fourth quarter revenue this week, as it notched strong demand for AI servers.

Meanwhile, Microsoft this month said that it plans to spend $80 billion in its fiscal year to June on the construction of data centers that can handle artificial intelligence workloads.

CNBC’s Jordan Novet contributed to this report.

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Supreme Court set to hear oral arguments on challenge to TikTok ban

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Supreme Court set to hear oral arguments on challenge to TikTok ban

Tik Tok creators gather before a press conference to voice their opposition to the “Protecting Americans from Foreign Adversary Controlled Applications Act,” pending crackdown legislation on TikTok in the House of Representatives, on Capitol Hill in Washington, U.S., March 12, 2024.

Craig Hudson | Reuters

The Supreme Court on Friday will hear oral arguments in the case involving the future of TikTok in the U.S., which could ban the popular app as soon as next week.

The justices will consider whether the Protecting Americans from Foreign Adversary Controlled Applications Act, the law that targets TikTok’s ban and imposes harsh civil penalties for app “entities” that continue to carry the service after Jan.19, violates the U.S. Constitution’s free speech protections.

It’s unclear when the court will hand down a decision, and if China’s ByteDance continues to refuse to divest TikTok to an American company, it faces a complete ban nationwide.

What will change about the user experience?

The roughly 115 million U.S. TikTok monthly active users could face a range of scenarios depending on when the Supreme Court hands down a decision.

If no word comes before the law takes effect on Jan. 19 and the ban goes through, it’s possible that users would still be able to post or engage with the app if they already have it downloaded. However, those users would likely be unable to update or redownload the app after that date, multiple legal experts said.

Thousands of short-form video creators who generate income from TikTok through ad revenue, paid partnerships, merchandise and more will likely need to transition their businesses to other platforms, like YouTube or Instagram.

“Shutting down TikTok, even for a single day, would be a big deal, not just for people who create content on TikTok, but everyone who shares or views content,” said George Wang, a staff attorney at the Knight First Amendment Institute who helped write the institute’s amicus briefs on the case. 

“It sets a really dangerous precedent for how we regulate speech online,” Wang said.

Who supports and opposes the ban?

Dozens of high-profile amicus briefs from organizations, members of Congress and President-elect Donald Trump were filed supporting both the government and ByteDance.

The government, led by Attorney General Merrick Garland, alleges that until ByteDance divests TikTok, the app remains a “powerful tool for espionage” and a “potent weapon for covert influence operations.”

Trump’s brief did not voice support for either side, but it did ask the court to oppose banning the platform and allow him to find a political resolution that allows the service to continue while addressing national security concerns. 

The short-form video app played a notable role in both Trump and Democratic nominee Kamala Harris’ presidential campaigns in 2024, and it’s one of the most common news sources for younger voters.

In a September Truth Social post, Trump wrote in all caps Americans who want to save TikTok should vote for him. The post was quoted in his amicus brief. 

What comes next?

It appears TikTok could really get shut down, says Jim Cramer

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