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Australian Court Finds Google Guilty of Deceptive Ad Tactics

An Australian court this week found that Google engaged in deceptive advertising practices with a series of ads on Google Australia.

April 3, 2012

An Australian court this week found that Google engaged in deceptive advertising practices with a series of ads on Google Australia.

The decision came after a lower court found that Google was not guilty of such tactics, prompting an appeal from the Australian Competition and Consumer Commission (ACCC). Today, the Full Federal Court found in favor of the commission.

At issue are sponsored links that show up in search results. "Google's conduct involved the use by an advertiser of a competitors name as a keyword triggering an advertisement for the advertiser with a matching headline," ACCC chairman Rod Sims said in a statement. "As the Full Court said this was likely to mislead or deceive a consumer searching for information on the competitor."

If a user searched for "iPad," for example, the sponsored link would say "Apple iPad," but if someone clicked on it, it might take them to the website for Amazon's rival Kindle Fire tablet.

Last year, an Australian judge found that this was not Google's problem because the search giant did not "make" the representations in the ads. The Full Court, however, found that "Google created the message which it presents."

"The enquiry is made of Google and it is Google's response which is misleading," the court said. "Although the key words are selected by the advertiser, perhaps with input by Google, what is critical to the process is the triggering of the link by Google using its algorithms."

"This is an important outcome because it makes it clear that Google and other search engine providers which use similar technology to Google will be directly accountable for misleading or deceptive paid search results," said ACCC's Sims.

In a statement, a Google spokesperson said the company is disappointed by the ruling.

"Google AdWords is an ads hosting platform, and we believe that advertisers should be responsible for the ads they create on the AdWords platform," Google said. "We're committed to providing an advertising platform that benefits both advertisers and users. We investigate complaints about violations of our policies and terms and conditions, and if we are notified of an ad violating our terms and conditions we will remove it. We are currently reviewing our options in light of the court's decision."

According to the ACCC, Google will be required to implement a consumer law compliance program and pay the cost of the ACCC's appeal.

The ACCC recently went after Apple over complaints related to the new iPad's 4G LTE connectivity, prompting Apple to .