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Google Class-Action Denial Can Be Appealed

22 Aug, 2012 By: Doug McPherson

SAN FRANCISCO – Marketers suing Google might be able to move forward with a class-action lawsuit after all.

Earlier this year, U.S. District Court Judge Edward Davila (in the Northern District of California) rejected the marketers’ motion for class-action status. Davila ruled that a class action would be inappropriate because “individualized issues of restitution permeate the class claims.”

But last week, MediaPost reported that a federal appellate court has agreed to decide whether the marketers can proceed against the search giant.

The report noted that several pay-per-click marketers – including container company JIT Packaging, law firm Pulaski & Middleman and retailer RK West – alleged in potential class-action lawsuits that ads on Google’s AdSense for Domains and AdSense for Errors programs result in fewer purchases than ads on Google’s search results pages. The marketers also claimed that ads on parked domains “could damage their brands.”

The Ninth Circuit Court of Appeals didn’t explain why it was accepting the case, but MediaPost reported that the move is consistent with the court’s decision last month in a case involving Facebook, where the court agreed to consider whether pay-per-click marketers suing the social networking service may proceed with a similar class-action suit.

With Facebook, marketers Fox Test Prep and Steven Price (who operates are seeking to overturn U.S. District Court Judge Phyllis Hamilton’s decision rejecting their motion for class-action status. Hamilton ruled this spring that the marketers hadn’t shown that “common questions predominate” – a necessary condition for class actions.

But the marketers say Facebook charged them for invalid clicks. In 2010, a U.S. District Court judge ruled Facebook’s contract with marketers disclaimed liability for clicks that were “fraudulent” in the sense that the clicker had dubious intentions. But the judge ruled that Facebook’s disclaimer didn’t apply to clicks that were “invalid” – such as when technical problems kept users from reaching landing pages.

In Hamilton’s ruling denying class certification, she said the marketers hadn’t shown a “uniform method” for distinguishing “invalid” clicks from “fraudulent” ones.

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