Yahoo Settles Ad Placement Lawsuit

SUNNYVALE, Calif. — Yahoo Inc. has settled a class-action suit after unhappy search-advertising customers sued the company over where their pay-per-click ads were showing up.

On Tuesday, lawsuit administrator Rust Consulting, a third-party firm based in Minnesota, sent an email to members of the class that preliminary court approval of the settlement has been granted.

Yahoo customers who sued claimed that when ads they placed through Sponsored Search and Contact Match, they showed up in spyware, parked sites, typosquatting sites and other dark corners of the web. The ads were supposed to appear on "highly targeted" sites.

Yahoo’s clients sued the Sunnyvale company for breach of contract, unjust enrichment, misrepresentation, civil conspiracy, and unfair business practices.

Yahoo agreed in the accord to offer a new filtering option for ads and to modify how it handles disclosures and click-fraud investigations. It also agreed to develop and offer a way for customers to control where their Yahoo Ads appear.

Yahoo will create an Ad Placement Option for advertisers to guarantee their ads will appear only on sites owned by Yahoo or sites designated as premium partners. That feature should appear early next year but Yahoo has a deadline of Sept. 30 to provide advertisers with that option.

Advertisers also will get better tools for measuring traffic quality and potentially troubling sites bearing their ads.

Yahoo class litigants are eligible for a $20 settlement, as well. The litigants must submit a claim by March 22; those ready to sue Yahoo individually need to exclude themselves from the settlement by Dec. 14.

All told, Yahoo plans to divey out $4.3 million to its clients with the agreement. Attorney fees will reach about $4.2 million.

Yahoo Settlement Agreement

Related:  

Copyright © 2026 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More News

Pineapple Support Partners with Better Life Science's 'STD Hero'

Pineapple Support has partnered with Better Life Science brand STD Hero.

Brazil Sets Enforcement Timeline for New AV Rules

Brazil’s National Data Protection Authority (ANPD) on Friday published a timeline outlining planned steps for monitoring and enforcing age verification under the country’s Digital Statute for Children and Adolescents (Digital ECA), which took effect Tuesday.

Utah Governor Signs 'Porn Tax' and VPN Rule Into Law

Governor Spencer Cox on Friday signed into law a bill to tax adult websites and make them liable if minors circumvent geolocation.

BranditScan Launches 'White Glove' Subscription Tier

BranditScan has launched its new White Glove subscription tier for creators.

German Court: Regulator Can't Block Creator's IG Account, Only Posts

A German court has ruled that while a regional media regulatory agency may block specific Instagram posts that include material deemed harmful to minors, it cannot ban an entire Instagram account due to such a post.

Brazil Lays Out Preliminary Guidelines for New AV Requirements

President Luiz Inácio Lula da Silva on Wednesday signed a decree establishing guidelines for new regulations requiring adult websites to age-verify users located in Brazil.

Senate Committee Debates Section 230 Reform

The U.S. Senate Committee on Commerce, Science, and Transportation held a hearing Wednesday on potential changes to Section 230 of the Communications Decency Act, which protects interactive computer services — including adult platforms — from liability for user-generated content.

Pearl Industry Network Offers Free Creator Memberships

Industry trade group Pearl Industry Network (PiN) has launched its free creator membership initiative.

Sam Bird Acquires Fanblast

Sam Bird, former co-director of global talent agency Surge, has acquired creator monetization tool Fanblast and named himself CEO.

'SheHerGirls' Launches Through Paysite.com

The braintrust behind PoleVixens has officially launched a new membership site, SheHerGirls, also through Paysite.com.

Show More