Google Sues Search Engine Marketing Firm For False Advertising

Google has sued the search engine marketing and optimization company Local Lighthouse for allegedly misrepresenting to customers that it's affiliated with Google.

Local Lighthouse's staff allegedly "harassed" its customers by repeatedly making misleading telemarketing calls, Google alleges in a complaint filed on Wednesday in U.S. District Court for the Northern District of California. The lawsuit accuses Local Lighthouse of false advertising, trademark infringement and unfair competition.

Google says that Local Lighthouse told customers it could guarantee placement in the first page of Google's search results. Specifically, Local Lighthouse's sales representatives allegedly made statements like “We’re working for Google," and promised customers that their listings "will show up multiple times on the front page and get what’s called ‘Front Page Domination.’”

Google says in its complaint that Local Lighthouse's practices are causing confusion, spurring consumers to complain to Google, and also to sue Local Lighthouse.

Court records show that Local Lighthouse is currently facing several lawsuits, including at least one by a marketer who alleges the company made "untrue and materially misleading statements" regarding its relationship with Google. That matter, a potential class-action filed in July by New Jersey resident Eddie Sitts, is pending in U.S. District Court in Trenton.

Local Lighthouse has a statement on its Web site reading "Local Lighthouse is not Google." Visitors who click through land on a disclaimer that describes Lighthouse as "an independent third party for Google AdWords."

It's not yet how strong Google's case is, according to Santa Clara University law professor and online advertising expert Eric Goldman. Much could depend on facts that have yet to emerge.

Goldman says that a search engine marketing company should be allowed to use the word "Google" to describe its business when that company helps marketers to manage their presence on Google.

"There might be a kernel of truth to each of these statements," he says, referring to the statements allegedly made by Local Lighthouse's representatives. "And businesses are allowed to tell that truth."

On the other hand, Goldman says, a search engine marketer that gives the false impression that it has "unique ties" to Google might be duping its customers. "That's a problem for Google and for the duped business," he says.

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