California’s own Attorney General Jerry Brown has decided that his office ought to investigate the proposed monopoly-enhancing Yahoo-Google revenue-sharing ad deal too.

Brown’s letting the Justice Department do his legwork and is reviewing documents the agency collects, according to the San Francisco Chronicle.

The DOJ of course appears to getting ready to challenge the arrangement and has hired outside litigator Sandy Litvack, a former US antitrust chief and past Disney vice-chairman, to put the case together.

A couple of weeks ago Google CEO Eric Schmidt, who has consistently maintained with Clintonesque logic that the Microsoft-thwarting deal was pro-competitive, was making noises close to “Damn the regulators, full speed ahead.”

We’ll see how his bravado holds up – or whether he folds his tents.

He’s already facing rebellion from the ad base.

The Association of National Advertisers (ANA), which represents 400 household names that do $100 billion worth of ads a year, has told the DOJ that the “partnership will likely diminish competition, increase concentration of market power, limit choices currently available and potentially raise prices to advertisers for high-quality, affordable search advertising.”

Presumably, Carl Icahn, who now controls three seats on the Yahoo board, is loving this. If the government stops Yahoo from collapsing into Google’s arms, it will create an opportunity for Microsoft to claim at least some of the remains.

Currently the Yahoo-Google plan is to throw the switch on their deal next month. Wonder if that means the DOJ will go directly for an injunction.