A class action lawsuit has been filed against Ask Jeeves (Ask.com) parent company IAC Search & Media Inc. over failing to prevent “click fraud” on advertisements purchased from the company.
Put simply, “click fraud” occurs where a person or program clicks on an advertisers sponsored listing in an attempt to defraud an advertiser who pays a CPC (cost-per-click) each time the listing is clicked on.
Details of the class action lawsuit are revealed below in an email send to ask advertisers:
“If you purchased online advertising from IAC Search & Media, Inc. and/or Ask Jeeves, Inc. (collectively “Ask”) between August 1, 2005 and the present, you may be a class member in a class-action lawsuit, Lane’s Gifts and Collectibles et al. v. Ask Jeeves, Inc. et al., Case No. CV-2005-52-1, in the Circuit Court of Miller County, Arkansas. This notice advises you of your legal rights.
You should review the detailed Settlement Notice as soon as possible, as there are several important deadlines that you must meet to take certain actions in connection with a proposed settlement of the class action lawsuit. Your legal rights are affected whether you act or do not act. The deadline for filing an objection or excluding yourself from the proposed settlement is February 2, 2008, and the last day to file a claim under the proposed settlement is February 2, 2008. For further information, please refer to the Settlement Notice.
The Settlement Notice informs you of the Court’s certification of a class for settlement purposes; the nature of the claims alleged; your right to participate in, or exclude yourself from, the class; a proposed settlement; and how you can claim an award of advertising credits under the settlement or object to the settlement.
The proposed settlement will provide advertising credits to class members who certify that they were the victims of “click fraud” or other invalid or improper clicks on online advertisements purchased from IAC Search & Media, Inc. and/or Ask Jeeves, Inc. on or after August 1, 2005.
The proposed settlement will resolve claims that IAC Search & Media, Inc. and/or Ask Jeeves, Inc. breached its contracts with advertisers and violated other laws by failing to adequately detect and stop “click fraud” or other invalid or improper clicks on online advertisements.
If you are a member of the class, your legal rights are affected by whether you act or do not act.
For a copy of the Settlement Notice, click on the link, or visit the case website at www.AskSettlement.com.
To file a claim for your award of advertising credits under the settlement, click on the following link: AskSettlement.com/claim. Each advertiser will be allowed one claim per account.”
According to Wikipedia, “Lane’s Gifts and Collectibles” also raised a successful suit against Google in March 2006 in which Google agreed to a $90m settlement fund in a class action filed by the company.
This legal challenge may act as a wake up call to other advertising networks over the need to proactively prevent and detect click fraud in their advertising programs. If the case affects you, we’d love to hear your thoughts via our blog comments.