In a victory for Google, a judge this week denied class-action status to a pay-per-click advertiser who claims the company misrepresented the effectiveness of its click-fraud detection system.
The ruling allows business owner Gurminder Singh to continue proceedings against Google as an individual, but doing so is often prohibitively expensive.
The decision comes in a battle to 2016, when Singh brought a class-action complaint against Google over alleged click fraud on its display network -- including Blogger, YouTube and other sites that show pay-per-click ads. Singh said that starting in 2016, he noticed "anomalous click patterns" that suggested fraud.
U.S. District Court Judge Beth Labson Freeman in the Northern District of California originally threw out the suit, ruling that Singh couldn't show he had been harmed.
But in 2020, the 9th Circuit Court of Appeals revived Singh's claims that Google violated California state laws against unfair competition -- a broad concept that includes unfair or deceptive practices -- and false advertising. The appellate court said in its ruling that Singh's allegations, if true, could show he was economically harmed.
The appellate judges said Singh's allegations regarding his own analysis of the pay-per-click campaign charges, combined with outside studies, were “sufficient to draw the reasonable inference” that his ad campaigns “suffered higher-than-advertised rates of fraudulent clicks not caught by Google’s filters, and that he accordingly paid for more fraudulent clicks than Google advertised he would.”
Freeman said in this week's decision denying class certification that Singh wasn't representative of the advertisers he wanted to represent.
Among other reasons, Singh had opted out of Google's arbitration agreement, Freeman said.
Had Singh not done so, he may not have been able to proceed in federal court. But the fact that he opted out also distinguished him from most of the advertisers he wanted to represent as a class, according to the judge.
“The court agrees with Google that Singh is atypical because he opted out of the arbitration clause to which many or most of the putative class is subject,” Freeman wrote.
Freeman also said Singh wasn't typical of the proposed class because he hadn't shown that all advertisers saw the same Google statements regarding the effectiveness of its fraud detection system.
Singh had specifically pointed to a statement that invalid clicks average “less than 10%” of all clicks (which appeared in a 2007 Google blog post), as well as a similar estimate in the company's “Ad Traffic Quality Resource Center.”
He argued that 10% figure was too low, and that his expert estimated that click fraud accounts for 14% of clicks on online advertising platforms, including Google's.
Freeman said in her ruling that Google submitted evidence that “many” pay-per-click advertisers use agencies, and therefore wouldn't have seen the alleged misrepresentations.
Freeman also said that Singh's theories would “make Google liable for any undetected fraudulent clicks that pass through its filters.”
“The AdWords Agreement ... makes clear that Google cannot detect all click fraud, and that if an advertiser believes some click fraud has gone undetected, that it should use Google's claims process to pursue a refund,” she wrote.