Google Settles Click Fraud Case for $90 Mln

By Geoff Duncan Published July 28, 2006

Seems like Google‘s online advertising juggernaut might be a spoke or two short of a wagon-load: a circuit court judge in Texarkana, Arkansas, has approved a $90 million settlement in a class action lawsuit brought against Google by Lane’s Gifts.

Under the terms of the settlement (PDF), Google will give advertising credits equivalent to $3.80 on oever $1,000 spent on its online advertising systems during the last four and half years. Google isn’t giving any cash to anybody, except the lawyers: they’ll collect $30 million straight out of Google’s corporate checkbook.

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The suit alleges that Google billed advertising customers for fraudulent “clicks” on ads appearing on Google’s advertising systems, and thse clicks did not correspond to real people, and that Google overstated the nature of its efforts to prevent so-called “click fraud.” Google, for its part, admits to no wrongdoing—and goes to some effort to convince advertisers that it weeds out most click fraud before it ever hits customers’ statements. Advertisers interested in how the settlement applies to them can file claims through August 4, 2006.

The settlement gets Google out from under the Lane’s Gifts suit; however, other Internet companies like Yahoo, Netscape, Ask.com, Go.com, Lycos, LookSmart, and AOL are still named parties.

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