Google Will Pay $22M to Settle AdWords Litigation

After more than eight years of litigation, parties to a Google AdWords class action lawsuit have agreed to a multi-million dollar settlement.

Plaintiffs’ counsel filed a motion on Thursday seeking preliminary approval of the Google AdWords settlement. The settlement would require Google to set up a $22.5 million non-reversionary fund from which qualifying Class Members would receive cash payments.

This Google AdWords litigation is a consolidation of four separate Google class action lawsuits the first of which was filed back in July 2008. The plaintiffs claim that between July 2004 and March 2008, Google placed advertisements purchased through its AdWords program either on error pages or on pages with no content, known as parked domains.

In doing so, plaintiffs allege, Google failed to provide its advertising customers with the value they paid for. They claim they purchased advertising services with the understanding that Google would place their ads on “high quality” websites.

Google allegedly failed to disclose this practice to millions of its advertising customers. The class action lawsuits accused Google of violating California’s False Advertising Law and Unfair Competition Law.

Google continues to deny the plaintiffs’ allegations by saying it adequately disclosed the practice at issue.

The current Google AdWords settlement is the result of negotiation and mediation efforts that began as far back as February 2011.

According to the terms of this Google AdWords settlement, the settlement fund will cover cash payouts to Class Members, service awards of up to $5,000 to each of the named Class Representatives, costs of administering the settlement, and attorneys’ fees and expenses for plaintiffs’ counsel.

Any leftover funds will be distributed either to public interest organizations Public Counsel and Public Justice Foundation, or to Class Members with an active Google AdWords account who did not submit a claim. If the total amount of received claims exceeds the amount of the fund, payments to Class Members may be reduced on a pro rata basis.

Plaintiffs are asking the court for preliminary certification of a settlement Class that would cover “all persons or entities located within the United States who, from July 11, 2004 through March 31, 2008, had an AdWords account with Google and were charged for clicks on advertisements appearing on parked domains and/or error pages.”

This settlement Class is expected to cover about 2.3 million Class Members, according to the plaintiffs’ estimate.

A hearing on the motion for preliminary approval is planned for March 9.

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

Attorneys Robert C. Schubert and Noah M. Schubert of Schubert Jonckheer & Kolbe LLP serve as interim Class Counsel.

Other plaintiffs’ counsel includes attorneys from Chavez Law Firm PC, Foote Meyers Mielke & Flowers LLC, Gross Belsky Alonso LLP, Kabateck Brown Kellner LLP, The Kralowec Law Group, Saveri & Saveri Inc., The Law Firm of Peter L. Currie PC, and The Law Office of Peter A. Lagorio.

The Google AdWords Class Action Lawsuit is In re: Google AdWords Litigation, Case No. 5:08-cv-03369, in the U.S. District Court for the Northern District of California.

UPDATE: The Google AdWords class action settlement is now open! Click here to file a claim.