In a possible blow to Yahoo Inc.’s hopes for an advertising partnership with Google Inc., the Justice Department has hired an antitrust litigator to review evidence for what could become a legal challenge to the deal.
The Wall Street Journal reported Tuesday that the attorney is Sanford Litvack, a former vice chairman at Walt Disney Co. and chief of the Justice Department’s antitrust division during the Carter administration.
Litvack is reviewing evidence the department has gathered in what could become an antitrust case focused either on Google itself or on the search advertising partnership it announced with Yahoo in June, the Journal reported. That deal was part of Yahoo’s attempt to ward off a takeover attempt by Microsoft Corp.
A Justice Department spokeswoman declined to comment on the report.
But Yahoo said in an e-mailed statement, “We have been informed that the Justice Department, as they sometimes do, is seeking advice from an outside consultant, but that we should read nothing into that fact. We remain confident that the deal is lawful.”
Blair Levin, a regulatory analyst at Stifel Nicolaus, said in a note to clients that the hiring of an outside lawyer such as Litvack is a “rare” move by the department that likely indicates a legal challenge against a company or transaction.
“The stakes are … far higher for Yahoo,” Levin wrote, because Google has “already succeeded in keeping Yahoo out of the arms of Microsoft.”
The partnership between the two companies would allow Google to sell some of the ads displayed alongside search results on Yahoo’s Web site. Yahoo and Google have insisted the deal would benefit consumers and advertisers, but they have delayed it until early October to give the Justice Department time to review it.
“We are confident that the arrangement is beneficial to competition, but we are not going to discuss…