In a blow to gift basket company Edible Arrangements, a federal judge has sent the company's dispute with Google over search ads to arbitration.
Edible Arrangements alleged in a lawsuit filed in February that Google dupes customers who search for the phrase "Edible Arrangements" by showing them ads for competing companies. The complaint centered on "product listing ads" that appear on the righthand side of the search results pages and include small graphic images. A link above the ads takes people to a Google Shopping page.
In April, Google urged U.S. District Court Judge Michael Shea in New Haven, Conn. to send the matter to arbitration. Google argued that Edible Arrangements -- which advertises with the search company -- accepted its terms and conditions, including one that calls for arbitration of all disputes related to its ad programs.
"Google’s Terms And Conditions conspicuously and prominently disclose the arbitration provision, and its terms are reasonable," Google argued in its court papers. "They even provide an option to opt-out of the provision, which Edible Arrangements did not invoke."
Edible Arrangements countered that the dispute about the product listings ads for competitors was outside the scope of its arbitration agreement, essentially arguing that the terms and conditions applied only to disputes about its own ads on the service.
Shea rejected the gift basket company's argument on that point. He wrote that the arbitration clause applies to disputes that "relate in any way" to Google's ad programs. "The allegations underlying all of the plaintiffs' claims plainly fall within this broad scope," Shea wrote in an order issued late Friday.