Thursday, Nov 18, 2004    Text size: 

The case, filed in Santa Clara County Court, also alleges that Houston, Texas-based Auctions Expert International were in breach of their contract with Google for intentionally manipulating the advertising program.

AdSense allows for “unobtrusive and context-sensitive advertising,” according to Google, by linking a web user’s queries with similar advertising.

“The advertiser pays Google for the user’s click and Google, in turn, pays the majority of the money it receives back to the website author,” Google said in its legal filing.

The AdSense agreements, though, expressly bar any company from clicking on its own sites in order to create ad revenue or to pay other people to click on the company’s sites.

“[Auctions Expert] flagrantly abused the AdSense Online service by artificially and/or fraudulently generating ad clicks,” the complaint stated. “These clicks were worthless to advertisers because they generated significant and unjust revenue for the defendants, who were paid by Google as if the clicks were legitimate.”

Pay-per-click fraud has been a hot topic recently for Google over the past year.

In March, 32-year-old Michael Bradley was arrested by the FBI after he developed a piece of software called “Google Clique” that roamed the Internet, clicking on AdSense advertisements.

Bradley first tried to sell his software to the search company for $100,000, and then, when Google failed to respond, threatened to release the program to the “top 100 spammers.”

Google also mentioned the subject in its April IPO filing with the SEC as a potential threat to its stock viability.

“We have regularly paid refunds related to fraudulent clicks and expect to do so in the future,” said Google. “If we are unable to stop this fraudulent activity, these refunds may increase.”

Calls to Google attorney David H. Kramer, with Wilson Sonsini Goodrich & Rosati in Palo Alto, were not returned as of this posting.

The case is Google Inc. Vs. Auction Expert International L.L.C., et al., CV030560.