Facebook Asks 9th Circuit To Rule Against Pay-Per-Click Marketers


Facebook is asking an appeals court to uphold a ruling against two pay-per-click marketers who tried to bring a class-action lawsuit against the social networking service.

The marketers -- Fox Test Prep and Steven Price, who operate the car site DriveDownPrices.com -- argue that Facebook violated its contract with pay-per-click marketers by charging them for invalid clicks. Fox Test and Price are attempting to bring a class-action on behalf of all pay-per-click marketers on Facebook.

U.S. District Court Judge Phyllis Hamilton in the Northern District of California ruled last year that Fox Test and Price could not proceed with a class-action. She allowed the marketers to continue individually, but doing so tends to be prohibitively expensive.

The marketers recently asked the 9th Circuit Court of Appeals to reverse Hamilton's ruling. They argue that the lawsuit raises questions that are common to all of Facebook's pay-per-click marketers, and therefore should be certified as a class-action.

But Facebook counters that Hamilton's decision was correct. Among other arguments, the social networking service contends that the type of overcharging allegations made by Price and Fox don't lend themselves to class actions. "Facebook will have idiosyncratic defenses with respect to each plaintiff based on their unique server data," the company says in its brief, which was made publicly available earlier this month.

Facebook also says that Fox Test and Price aren't good class representatives because neither marketer disputed the charges within 30 days, as is required by contract. Therefore, Facebook argues, it has defenses to claims by Fox and Price that might not apply to other marketers.

The case dates to 2009, when Price, Fox Test and other pay-per-click marketers sued the social networking service after noticing discrepancies between their server logs and their bills from Facebook. The marketers alleged that they were billed for clicks that didn't correspond to visits to their sites.

U.S. District Court Judge Jeremy Fogel in San Jose, Calif. ruled three years ago that Facebook's contract with marketers disclaimed liability for clicks that were "fraudulent" in the sense that the clicker had dubious intentions. But Fogel ruled the disclaimer didn't apply to "invalid" clicks -- such as clicks by users who couldn't reach the landing page due to technical problems.

In denying the motion for class certification, Hamilton ruled that the marketers hadn't shown there was a uniform method for determining which clicks were invalid.

Facebook argues that Hamilton's conclusion on that point is correct. "Plaintiffs presented no specific methodology for parsing the data ... in a way that separates out the supposedly 'invalid' clicks at issue in plaintiffs’ claims from 'valid' clicks and 'fraudulent' clicks," the company says.


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