From the folks who brought you the Apple (AAPL)’s new-iMac-isn’t-cool-enough lawsuit, it’s a new class action, this one filed against Google (GOOG) for “ad program fraud:”
GOOGLE SUED FOR AD PROGRAM FRAUD
Google is deceiving its customers into paying for ads they dont want, according to a federal class action lawsuit filed today by Kabateck Brown Kellner, LLP in U.S. District Court, Northern District of California in San Jose.
“This debunks Google’s carefully cultivated image,” said Brian Kabateck, who is lead counsel on the case and Managing Partner of Kabateck Brown Kellner. “Google is hurting its customers on two fronts. Google is not only taking money out of customers’ pockets, its derailing their advertising strategies as well.
Kabateck recently won a multi-million dollar settlement from Yahoo! and was part of an earlier $90 million settlement from Google on behalf of advertisers who were victimized by “click fraud” to which the company turned a blind eye.
AdWords is Google’s primary advertising program and is the main source of its revenue. AdWords ads appear on Google.com as well as on Google partner sites like Ask.com. AdWords ads, however, may also appear on third-party Web sites, which use AdSense, the other side of the Google advertising model.
Google charges its advertising customers when someone “clicks” on one of their ads. During the sign-up process, users tell Google the maximum that they are willing to pay per “click.”
During this process, users encounter two adjacent boxes. Into the first, customers enter the amount they wish to pay per “click” of an ad displayed on Google.com. The second box is marked “optional.” Into this box, a user can enter the amount they would be willing to pay per “click” of an ad appearing on a third party web page. But leaving the box blank does not prevent ads from appearing on third-party sites. (NOTE: a screen cap is available upon request.)
Instead, Google places the ads on third-party sites anyway. And users are automatically charged per click based on the amount they entered into the first box. This suit arises from the fact that both actions occur without the user being informed.
Ads on third-party sites are widely-acknowledged to be far less effective (and therefore less valuable to the advertiser) than ads on Google.com. Google, of course, still profits greatly from these ads.
People go to Google hoping that some of its magic will rub off on them, Kabateck added. Instead, Google’s sleight of hand deception is making their money disappear.”
Kabateck Brown Kellner, LLP is one of the nation’s foremost consumer law firms. Its clients have won more than $750 million against Coca Cola, Farmer’s Insurance, Eli Lilly and other major corporations. As a plaintiff’s-only firm, Kabateck Brown Kellner is always on the consumers’ side.
Business Insider Emails & Alerts
Site highlights each day to your inbox.