Click fraud lawsuit lodged against Google
1 July 2005
Click Defense, a pay-per-click analysis firm, is reportedly suing search giant Google for failing to protect users of its advertising program from "click fraud".
The lawsuit, filed in US District Court, alleges Google has been negligent in monitoring fraudulent clicks and claims that click fraud has cost the company at least $5 million. Click Defense is also seeking class action status in the lawsuit filed on June 24th in San Jose, California.
The lawsuit demands that Google pay $10 million in compensation to Click Defense and calls for the search engine to be required to disclose "the true extent of click fraud" and reimburse any advertisers affected by it in full.
"We believe this suit is without merit, and we will defend ourselves against it vigorously," said Google spokesman Mike Mayzel. Questioned about a similar lawsuit pending in Arkansas state court, Mr Mayzel said the same comment would apply.
Scott Boyenger, chief executive of Colorado-based Click Defense, claimed in an email that the company's tracking system has detected click fraud rates of as high as 38 per cent.
Click fraud is not "fraud" as defined under the law, but is an industry term used to describe the deliberate clicking on web search ads with no intention of doing business with the company in question and is often done to force the firm to pay large sums for pay-per-click advertising.
Advertisers pay Google's web search advertising programme a set amount per click, varying in price from pennies to as much as $95. Click fraud can leave website operators facing bills of thousands, but Google insists that it credits advertisers who have fallen prey to click fraud.
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