Google Targeted in New Ad Lawsuit With Potential Damages in the Billions

A lawsuit has been brought against Google to collect compensation for lost income sustained by publishers for £3.4 billion ($4.2 billion).

Charles Arthur, a former technology editor at The Guardian, has reportedly filed a lawsuit against Google, alleging that the company exploited its dominating position in internet advertisements to unfairly decrease the revenue publications received from these ads.

Google has pledged a forceful defense against the "speculative and opportunistic" suit.

The first comparable case was filed in November 2022, making this the second. At the time, it was filed by Claudio Pollack, a former director of Ofcom, seeking up to £13.6 billion ($16.8 billion) in damages from the internet giant.

The Ad Tech

According to BBC News, the advertising technology, or ad tech, at issue in these lawsuits determines in a fraction of a second which ads users view, how much they pay, and how much money publishers get from those ads appearing on websites.

Notably, the majority of websites' revenue comes from online display advertisements.

The Competition and Markets Authority (CMA), the UK's competition regulator, is looking into Google's monopoly in the advertising tech industry.

Arthur filed the case on Thursday, Mar. 30. He alleges that Google exaggerated the cost of ad tech services and illegally cut publishers' ad sales income as a result of abusing their dominant market position.

The CMA is looking into Google's anti-competitive behavior in ad tech, but they cannot force them to pay out damages to individuals who have been harmed.

Class Actions

Both lawsuits filed by Arthur and Pollack request that the court (the Competition Appeal Tribunal) deem them "opt-out," meaning that all relevant publishers would be included in the case unless they opt out.

It was not until 2015 that British courts would accept what is known in the US as a class action or a group of people filing a lawsuit against a common defendant. BBC said class actions may result in substantial compensation for victims since the case is filed on their behalf.

If Arthur and Pollack do not agree to work together, the tribunal will have to choose who will serve as the representative plaintiff in the class action lawsuit.

Stiff Competition

Google informed the BBC that its advertising products, and those of its numerous ad tech rivals, help millions of websites and applications support their content and allow companies of all kinds to efficiently reach new consumers.

Google was determined to be the dominant player in three of the most important subsets of ad tech by the CMA, although the company insists it faces stiff competition. According to the company, its ad tech prices are competitive or cheaper than the market standard.

Nevertheless, in a lawsuit initiated in January, the US Department of Justice called Google an industry giant that "corrupted legitimate competition in the [ad tech] industry by engaging in a systematic campaign to seize control of the wide swath of high-tech tools used by publishers."

On Tuesday, Mar. 28, Google filed a motion to have the lawsuit dismissed, claiming that the US government exaggerated its market dominance.