Google Wins Legal Challenge by Australian Regulator Over Use of Paid Links
Google Inc. (GOOG), the world’s biggest Web search company, defeated a legal challenge by an Australian regulator over its use of paid ads in search results.
The Australian Competition & Consumer Commission sued Google in 2007, in the first claim of its kind in the world, according to the regulator, and alleged that Google broke the country’s Trade Practices Act when paid links appeared in search results, making it appear competitors were associated with the search request.
Justice Antony Nicholas in Sydney Federal Court dismissed the ACCC complaint against Google today.
When people searched for Trading Post, an online site for people looking to buy or sell cars, motorbikes, boats and other motorized vehicles, they were offered links to Kloster Ford and Charlestown Toyota, Trading Post’s competitors, the ACCC said.
“I am satisfied that Google did not know and had no reason to suspect that the publication of the Kloster Ford advertisement or the Charlestown Toyota advertisement would amount to a contravention” of the Trade Practices Act, Nicholas wrote in his 106-page ruling released today.
Google said in an e-mailed statement today that its guiding principle has always been that advertising should benefit both advertisers and users.
Nicholas found Trading Post breached the act by suggesting with its link that it was affiliated with the car dealerships. Nicholas ordered Trading Post to pay A$28,000 ($28,070) to the ACCC to cover its legal costs.
Current searches for Trading Post don’t showcase the paid links.
The case is Australian Competition and Consumer Commission v. Trading Post Australia Ltd. NSD1323/2007. Federal Court of Australia (Sydney).
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