Google Judge Says She May Approve $22.5 Million FTC Deal

A federal judge said she may approve Google Inc.’s $22.5 million agreement with the U.S. Federal Trade Commission over claims the company improperly planted cookies on Apple (AAPL) Inc.’s Safari Internet browser.

Advocacy group Consumer Watchdog opposes the accord, saying it lets Google off too easily and suggests that a separate government antitrust enforcement action against the world’s largest search engine company may lack teeth.

U.S. District Judge Susan Illston said at a hearing today in San Francisco that her “preliminary view” is to approve the proposed settlement, under which Google would pay a fine and expire the cookies without admitting wrongdoing. She said the penalty appeared “adequate” and that she will issue a final ruling soon.

“It implicates the procedure that will be used to resolve the antitrust case,” Gary Reback, an attorney for Consumer Watchdog, said in an interview after the hearing. “A consent decree will be weak, it won’t really make Google do anything.”

The record $22.5 million fine is the FTC’s first for an alleged violation of Internet privacy. Google deceived consumers and violated terms of a 2011 consent decree when it bypassed Apple software’s privacy settings and planted cookies on Safari, which allowed it to track users Internet browsing behavior, the FTC alleged.

Denies Wrongdoing

Google denies wrongdoing, according to filings in federal court in San Francisco. Software cookies are files residing on computers that help websites and browsers identify users.

A separate probe by the FTC into whether Google is abusing its dominance of the Internet has been under way for almost 20 months, and the agency is prepared to sue if the operator if Google fails to make an acceptable proposal, two people familiar with the matter said this week.

Consumer Watchdog says the cookie settlement allows Google to keep and use the data it collected, thus letting the company continue to profit from its misconduct. Google collected data from as many as 190 million users whose browsers’ privacy settings were overridden by the cookies, the group said in court filings.

The group also faulted the settlement because it doesn’t include an admission of wrongdoing by Mountain View, California- based Google.

Cookie Information

David Kramer, Google’s attorney, told Illston that Consumer Watchdog’s concerns are “neither realistic or practical” because the company doesn’t retain cookie information identifying users and their Internet addresses change over time.

Adrienne Fowler, a Justice Department attorney, told Illston that Google garnered very little data on users and most of it came from other legal methods not at issue in the FTC case.

“Any data collected would really be a drop in the ocean,” Fowler said.

The company signed a consent decree with the FTC last year to settle allegations that it used deceptive tactics and violated its own privacy policies in introducing the Buzz social-networking service in 2010.

The 20-year agreement bars Google from misrepresenting how it handles user information and requires the company to follow policies that protect consumer data in new products.

The case is U.S. v. Google Inc. (GOOG), 3:12-cv-04177, U.S. District Court, Northern District of California (San Francisco).

To contact the reporter on this story: Karen Gullo in San Francisco at kgullo@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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