ACCC wins appeal against Google

Today the Full Federal Court unanimously upheld the Australian Competition and Consumer Commission’s appeal filed in October 2011 against Google.

The Full Court declared that Google, by publishing the four advertisements that were the subject of the ACCC’s appeal on result pages of the Google Australia website, engaged in conduct that was misleading or deceptive, or likely to mislead or deceive, in breach of section 52 of the Trade Practices Act 1974*.

The Full Court also ordered it to put in place a consumer law compliance programme and pay the ACCC’s costs of the appeal.

“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. As the Full Court said this was likely to mislead or deceive a consumer searching for information on the competitor,” ACCC chairman Rod Sims said.

The central issue for determination on appeal was whether the primary judge erred in finding that Google did not “make” the representations contained in the four advertisements that were the subject of the appeal.

“The ACCC brought this appeal because it raises very important issues as to the role of search engine providers as publishers of paid content in the online age,” Mr Sims said.

“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,” Mr Sims said.

In upholding the ACCC’s appeal, the Full Court concluded that “here Google created the message which it presents. Google’s search engine calls up and displays the response to the user’s query. It is Google’s technology which creates that which is displayed. Google did not merely repeat or pass on a statement by the advertiser: what is displayed in response to the user’s search query is not the equivalent of Google saying here is a statement by an advertiser which is passed on for what it is worth.”

The Full Court also stated that “the enquiry is made of Google and it is Google’s response which is misleading… 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.”