Google Sued for "Click Fraud"

Pay-per-click analysis firm slams Google in federal suit, alleging the search giant profits from ‘click fraud.'

Google profits from the manipulation of its pay-per-click advertising service by others, and hasn’t done enough to end the practice, according to a lawsuit filed by pay-per-click analysis firm Click Defense.

The lawsuit, filed in U.S. District Court as a potential class action, alleges Google has been negligent in monitoring fraudulent clicks, at a loss to its advertisers and a gain to its own bottom line.

In addition to more than $10 million, the suit asks that Google be required to disclose “the true extent of click fraud” and to return any money to advertisers that resulted from the practice.

“We believe this suit is without merit, and we will defend ourselves against it vigorously,” said Google spokesman Mike Mayzel. The case is similar to a suit pending in Arkansas state court, and Mr. Mayzel said the same comment would apply in that case.

While Google’s AdWords program does have a process for click fraud refunds, “the protocol is changing by the week,” according to Scott Boyenger, CEO of Click Defense. “When you’re bringing in a billion dollars a quarter, you’re going to protect that nut.”

Advertising is far and away Google’s main source of revenue. The company reported revenue of $1.256 billion in the first quarter, including $462 million in traffic acquisition costs that it shares with its partners.

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