Google Sued For Breach Of Contract?

Google, the online search giant, seems to be in the news these days for some very negative reasons. The recent of such is a lawsuit filed in a US Court a few days ago. In the lawsuit ActiveCast Media, a subsidiary of Web Integrated Net Solutions and headquartered in the British Virgin Islands, is suing Google for breach of contract.

Google Sued by ActiveCast Media for Breach of ContractAccording to ActiveCast Media, they were contracted to send traffic to Google advertisers as part of its contract agreement with Google DoubleClick AdExchange (AdX). However, in June Google flagged ActiveCast’s account for invalid activity and retroactively put a hold on their payments which totaled a little more than $1 million! ActiveCast, claiming the traffic was not invalid has therefore slammed a suit for about $1.3 million for breach of contract and loss of expected revenue on Google. Click here for details on the case.

It will interest you to know that Google DoubleClick AdExchange (AdX) is a real-time marketplace “that helps ad networks, agency holding companies, and emerging third-party technology providers maximize ROI across millions of sites.” It is a real-time marketplace partnered with the Google Display Network for buying and selling advertising.

Of course, this lawsuit has brought up some of the very questionable issues that borders on transparency in the world of online traffic acquisition through advertising networks like Google’s DoubleClick AdExchange. As many of us do know Google is very secretive when it comes to what it considers invalid clicks. For example, if you running Google adsense on your sites and your account happened to be flagged by Google at any time for invalid clicks, it will take the grace of the almighty God for you to convince Google otherwise. The decision to re-activate your account will only be at the mercy of Google!

It is therefore not surprising that many industry experts are already doubtful if ActiveCast Media will be able to prove their case. Of course, their publisher clients may have purchased the traffic from reputable companies like CNN and Fox News as claimed by ActiveCast Media but will they be able to prove their case since Google alone hold the data to prove which clicks are invalid and which are not.

As Chris Zaharias, CRO at Triggit, an FBX partner puts it,

“The court will decide the matter, but the bigger picture is that Google is the judge, jury and executioner when it comes to paying AdX publishers. No one but Google knows the three things necessary to assess ActiveCast’s claims: whether or not traffic was invalid; which advertisers paid what amounts for that traffic; and whether Google’s TAC reduction strategy affects its conduct.”

Indeed this may be a major hurdle for ActiveCast Media but beyond the case at hand, I see this as a possible attempt at making things a little more open in this market. If Google allows the suit to proceed and not opt for an outside court settlement, Google will have no option than to prove its case against ActiveCast Media and doing so will warrant Google showing some figures and how they were able to arrive at such figures.

There is no doubt that doing this will definitely remove some of the secrecy about Google operations and of course helping industry experts to, at least, have a glimpse of what Google is doing behind the scene!

Given that scenario I personally do not see Google going on with the case because I don’t see them allowing this to happen. Google’s desire to continue to keep such things secret will definitely overrule and a possible out of court settlement will be negotiated in the coming days!

Or what do you think will be the outcome of this lawsuit against Google?