• by Wendy Davis  @wendyndavis, September 26, 2013

In a major defeat for Google, a federal judge has refused to dismiss a lawsuit alleging that its Gmail service infringes privacy by scanning emails in order to surround them with contextual ads.

The lawsuit, filed in 2010, alleges that Google violates wiretap laws by interception people's emails in order to serve them ads that match the keywords in messages. Google argued that the case should be dismissed for several reasons, including that users consent to the scans. The company says that Gmail users consent by accepting the company's terms of service. Google also argues that non-Gmail users who send messages to Gmail accounts “implicitly” consent.

U.S. District Court Judge Lucy Koh in the Northern District of California disagreed with Google on both counts. “The Court finds that it cannot conclude that any party -- Gmail users or non-Gmail users -- has consented to Google’s reading of email for the purposes of creating user profiles or providing targeted advertising,” Koh wrote in a 43-page decision issued on Thursday.