« Matt Cutts announces new AdSense spam report feature | Main | Reporting publisher click fraud to Google just got easier »

July 01, 2005

Google hit with new click fraud lawsuit

Click Defense Inc has filed a lawsuit against Google, according to Reuters.

A seller of online marketing tools said on Wednesday it sued Google Inc., charging that the Web search giant has failed to protect users of its advertising program from "click fraud," costing them at least $5 million. Click Defense Inc. filed its lawsuit, which also seeks class action status, on June 24 in U.S. District Court in San Jose, California.
Click Defense claims it has detected click fraud as high as 38%, which is nearly double the commonly cited 20% click fraud rate quoted by most independent firms that track this.

Search Engine Watch also has further information, including the full filing in PDF format (18 pages) here.

So far, a Google spokeperson is only responding with "We believe the suit is without merit and we will defend ourselves against it vigorously."

Kevin Lee, chairman of search marketing firm Did-it.com discussed the issue with Christine Blank of DMNews.

"No one has fully defined when a click is 'fraudulent' versus simply a click from a poor quality source," he said. "So it is difficult to know if the firm initiating the lawsuit ... truly believes the fraud problem to be as big a deal as stated, or if they are just using the legal action for public relations."
A few things struck me as unusual immediately after this lawsuit was announced. First, the company suing is a click fraud detection company, and they have suddenly received a huge amount of media attention about the very thing their product is about - click fraud. And by citing they have discovered click fraud percentages of nearly double what is commonly quoted, they are effectively advertising the fact that their product can detect nearly double the amount of click fraud that most people believe exists. And a few news articles are reporting Click Defense as a click fraud opportunist, using it as a means to publicize their product in a way that other click fraud detection companies are not.

If a Adwords advertiser reads about the click fraud lawsuit and thinks 'Yikes, I better get something that can track my clicks better and make sure I am not being hit with nearly 40% fraudulent clicks too', which of the many services would you choose to go to? I bet Click Defense has had booming business success for their click fraud detection software since they filed.

Also, Click Defense continues to advertise with Google Adwords. It certainly raises the question of why does a company continue to advertise using a service that it believes delivers 38% fraudulent clicks?

Yes, fraudulent clicks do exist, but this case strikes me as likely being more for publicity than anything else, which I probably wouldn't have thought of if this company hadn't been promoting click fraud detection software in the first place.

Further discussion is at Search Engine Watch forums and WebmasterWorld.

Posted by Jenstar at July 1, 2005 08:44 PM

Trackback Pings

TrackBack URL for this entry:
http://www.jensense.com/mt-tb.cgi/78

Comments

Of course, Google could decline all Click Defense ads and kick them out of its index. Then, there will be no click fraud problem for them anymore...nor will there be any more clicks. :-)

The real irony here is a click fraud detection company complaining that it was a victim of click fraud. If a security company complained that its headquarters got burgled, would you be buying their services?

Posted by: bstreet at July 1, 2005 10:53 PM

Post a comment




Remember Me?