A lawsuit filed Tuesday against Google accuses the tech titan of engaging in widespread fraud by canceling AdSense accounts just before they were due to pay out.
The suit relies in part on recent anonymous accusations that Google developed an AdSense fraud scheme in 2009 to prevent publishers from collecting money that Google owed them. AdSense is a major advertiser partner network for Google that accounts for about a quarter of Google's annual revenue. In 2013, Google earned $57.86 billion in revenue.
"Google's actions constitute breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, and violation of the California Unfair Competition Law," the filing with the US District Court for the Northern District of California states. The lawsuit is seeking class action status so that it can represent all US-based AdSense users whose accounts were disabled or terminated with their Google refusing to pay them their final payment.
The case was filed by Hagens Berman Sobol Shapiro on behalf of Free Range Content, the California-based owner of Repost.us, which had been using AdSense to display ads. Free Range Content alleges that it first noticed an unusual jump of $40,000 in its AdSense earnings this past February. The company says that it reported the anomaly to Google, and was scheduled to speak with an AdSense representative on March 6 when Google disabled their account two days before the call. Google, the suit alleges, refused further contact with Free Range Content.
The anonymous accusation from the end of April alleged that Google had an internal policy that included a color-coded plan detailing when to block or approve different kinds of AdSense subscribers, called AdSense Quality Control Color Codes.
"We were told to begin banning accounts that were close to their payout period (which is why account bans never occur immediately after a payout). The purpose was to get that money owed to publishers back to Google AdSense, while having already served up the ads to the public," read the accusation, which had been posted on PasteBin and reposted Reddit.
Matt Cutts, the executive in charge of Google's Web spam team, decried the claims as a "conspiracy-laden fake, from the typos to wrong terminology to untrue policies to the lack of specific names of people."
However, Google did not respond to a request for comment on the lawsuit.