The program, known as "Project Bernanke," wasn't disclosed to publishers who sold ads through Google's ad-buying systems. It generated hundreds of millions of dollars in revenue for the company annually, the documents show. In its lawsuit, Texas alleges that the project gave Google, a unit of Alphabet Inc., an unfair competitive advantage over rivals.
The documents filed this week were part of Google's initial response to the Texas-led antitrust lawsuit, which was filed in December and accused the search giant of running a digital-ad monopoly that harmed both ad-industry competitors and publishers. This week's filing, viewed by The Wall Street Journal, wasn't properly redacted when uploaded to the court's public docket. A federal judge let Google refile it under seal.
Some of the unredacted contents of the document were previously disclosed by MLex, an antitrust-focused news outlet.
The document sheds further light on the state's case against Google, along with the search giant's defense.
Much of the lawsuit involves the interplay of Google's roles as both the operator of a major ad exchange -- which Google likens to the New York Stock Exchange in marketing documents -- and a representative of buyers and sellers on the exchange. Google also acts as an ad buyer in its own right, selling ads in its own properties like search and YouTube via these same systems.
Texas alleges that Google used its access to data from publishers' ad servers -- where more than 90% of large publishers use Google to sell their digital ad space -- to guide advertisers toward the price they would have to bid to secure an ad placement.
Google's use of bidding information, Texas alleges, amounted to insider trading in digital ad markets. Because Google had exclusive information about what other ad buyers were willing to pay, the state says, it could unfairly compete against rival ad-buying tools and pay publishers less on its winning bids for ad inventory.