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Case ID: 4327 | Technology | 10/18/2005
Click Defense, Inc., a seller of online marketing tools, sued Google Inc., on June 24, 2005 in U.S. District Court, in San Jose, California. Click Defense, Inc. alleges the Web search giant has failed to protect users of its advertising program from "click fraud," costing them at least $5 million. The lawsuit seeks class action status.
Click fraud is not "fraud" as defined under the law. Rather, it is an industry term used to describe the deliberate clicking on Web search ads by users with no plans to do business with the advertiser. Rival companies might employ people or machines to do this because the advertiser has to pay the Web search provider for each click. Users of Google's popular Web search advertising program pay a set amount -- varying from pennies to well over $1 -- for each click, though in rare instances, the payment is as much as $95. Click fraud can run up thousands of dollars in advertiser costs or benefit a Web site operator that gets a cut of advertising revenue from Internet search providers. Google, which had first-quarter 2005 net revenue of $1.3 billion, makes virtually all of its money from search ads. Google representatives have declined to say what percentage of clicks would fall under click fraud. The figure most cited by independent firms that track the practice is around 20 percent. Click Defense, which advertises on Google.com, is among a new crop of companies that aim to help identify and stop click fraud. Scott Boyenger, chief executive of Colorado-based Click Defense, said in an e-mail that his company's tracking system has detected click fraud rates of as high as 38 percent. The company sells software to prevent click fraud. Google and Yahoo, let advertisers set per-click pricing by allowing them to bid on key words that launch ads when Web users enter matching search queries. For example, when Web users type "laptop computer" into Google.com, they will see search results as well as a section of ads from laptop makers or sellers. Google has said it credits advertisers who have fallen prey to click fraud, but Click Defense charges that the company has not done enough to warn advertisers about the risks it presents or to protect them against it.
At Lawcash.com, it is our goal to keep you informed about important legal cases, class actions and settlements. Our lawyers offer free legal evaluations in tort cases, class actions, personal injury, and other lawsuits because we are dedicated to helping you resolve your legal complaints. Other Technology Cases of Interest A class action has been filed against the online movie rental service Netflix, Inc. and certain of its officers and directors by stockholders who purchased the company’s common stock between October 1, 2003 and July 15, 2004. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company’s securities. The stockholders seek to recover compensatory damages for the loss of value of their stock. Federal law prohibits the use of fax machines for sending unsolicited advertisements. The class has been certified in a class action filed against car wash company Carnett’s, Inc. on behalf of up to 73,500 persons who received advertisements over their fax machines in violation of the federal Telephone Consumer Protection Act. The action seeks between $500 and $1500 damages per fax sent as allowed by the Act. All persons who received such an ad should contact attorneys for the class. A right-of-way agreement gives a company the right to come on some part of your land to conduct part of its business operations. A class action has been filed against utility Entergy Technology Holding Company and related companies on behalf of Arkansas, Texas, Louisiana, and Mississippi property owners who allege that the power utility placed fiber-optic cables on easements on their land without permission to do so in violation of state contract law.
Networking manufacturer NetGear said that it would add a disclaimer to its packaging, offer a 15 percent discount on its online store, and pay $700,000 in legal fees in order to settle a class-action lawsuit over misrepresentation of the speed of its wireless products. In some areas of the country, DSL Internet service has gotten off to a slow, rocky start. The class has been certified in an action filed against Bell Atlantic Corporation (now known as Verizon Communications, Inc.) on behalf of New York customers who subscribed to the telephone company's high-speed Internet service. The action alleges that the company violated New York's consumer protection statutes by mis-advertising its Digital Subscriber Line, or DSL, service. The action seeks unspecified compensatory and punitive damages.
A national class action has been filed against eBay, Inc., on behalf of eBay auctioneers who allege that they were charged twice the amount they actually owed eBay after the online auction house launched a new payment processing system in February 2004. The action alleges that the company violated California consumer protection laws when it overcharged these and other individuals who sell items on its site. |
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