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Google Agrees To Pay 90 Million In Click Fraud SuitGoogle Agrees To Pay 90 Million In Click Fraud SuitSubjects > Computers > Internet > Search Engine News > Google
Google said on Wednesday March 8, 2006, it would pay as much as $90 million to settle it's share of a class action settlement in an industry wide lawsuit over alleged "click fraud" committed by search companies charging advertisers for false customer leads.
Plaintiffs in the case filed a year ago include Lane's Gifts and Collectibles, and covers problems dating back to 2002.
Click fraud is the malicious clickig of advertising links to generate inflated commissions. It can be done manually, or by automatic, robotic, means.
The class action suit argues that companies like Google benefit by not strongly battling click fraud.
$90 million settle will cover legal fees, and advertising credits, and will not involve any cash payments. In other words, Google has turned this settlement into a clever marketing tool to keep advertisers using their service. This kind of settlement terms has been used by other companies such as Western Union who settled a class action regarding misstatement of currency exchange rates by offering affected customers future rebates on using their cash transfer services.
Other defendants include Yahoo Inc., and lesser players Walt Disney Co., Lycos Inc., LookSmart?Create Ltd. and Findwhat.com Inc., which is now known as MIVA Inc..
Google's associate general counsel Nicole Wong said advertising customers would need to apply for reimbursement for ad clicks they believe are invalid. Normal policy gives advertisers 60 days to recover any such losses. Reimbursement is only given as credits for purchase of future advertising. The total claims under the program, including an unspecified amount of attorneys fees, "will not exceed $90 million".
Attorneys get the dough, and Google customers get the chance to waste their reimbursement on more click fraud.
Pay per click revenues account for approximately 97 percent of Google's current revenues. Google's revenue during their first 15 months as a public company were more than $7 billion dollars.
Yahoo is still pursuing a vigorous defense in the case. "We stand firmly by our proprietary click protection and look forward to vigorously defending our position in court," said Gaude Paez, Yahoo spokeswoman.
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