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Google settlement OK'd in click fraud case

An Arkansas judge Thursday approved a preliminary settlement worth up to $90 million between Google Inc. and advertisers who claimed the world's leading Web search provider overcharged them for their ads.
/ Source: Reuters

An Arkansas judge Thursday approved a preliminary settlement worth up to $90 million between Google Inc. and advertisers who claimed the world's leading Web search provider overcharged them for their ads.

Under the settlement, Google will be required to pay up to $60 million in credits for future advertising on Google, and up to $30 million is available to pay lawyers for those making claims against Google.

"We are pleased that we were able to reach an agreement and are pleased the judge has granted preliminary approval," Google's outside lawyer Daralyn Durie said.

The settlement, negotiated in March, resolves Google's part of an industrywide lawsuit alleging Web search companies overcharge some advertisers by billing them for false customer leads.

The lawsuit was filed a year ago by several plaintiffs, including Lane's Gifts and Collectibles. It covers abuse of Google's pay-per-click advertising system by outside parties.

The deal aims to resolve all outstanding claims against Google for so-called "click fraud" dating back to 2002, but similar claims against the Mountain View, California-based company are outstanding in other courts.

Lawyers for Yahoo! Inc. Lycos Inc., a subsidiary of Daum Communications Corp. , LookSmart Ltd. and Findwhat.com Inc., which is now known as MIVA Inc. , reserved the right to object to the settlement, but said they are not likely to do so.

At issue in the lawsuit is "click fraud," which is the abuse of search advertising systems for the purpose of driving up advertiser fees by repeatedly clicking on an advertising link — either manually or using robots — and so generating a commission payment with each click.