A David and Goliath battle is set to take place in the Federal Court of Australia. The ACCC on Wednesday instituted legal proceedings against Google and the Trading Post claiming the two companies have engaged in misleading or deceptive conduct.
Specifically, the ACCC alleges that Trading Post Australia Pty Ltd, Google Inc, Google Ireland Limited and Google Australia Pty Ltd contravened sections 52 and 53(d) of the Trade Practices Act 1974 in 2005 when the business names of Newcastle, NSW-based car dealerships Kloster Ford and Charlestown Toyota appeared in Google search.
Rather than appearing at the top of a search page when the business names were entered into the search engine, users were first greeted with the Trading Post URL instead.
According to the ACCC, unsuspecting customers would click on the Trading Post link, unaware that it was not the site they were after.
"Further, the ACCC is alleging that Google, by failing to adequately distinguish sponsored links from "organic" search results, has engaged and continues to engage in misleading and deceptive conduct in breach of section 52 of the Act," said a statement on the ACCC site.
According to the statement on the ACCC site, the watchdog is seeking:
- declarations that Trading Post contravened sections 52 and 53(d) of the Act
- declarations that Google contravened section 52 of the Act
- injunctions restraining Trading Post from representing through sponsored links in association, sponsorship or affiliation with another business where one does not exist
- injunctions restraining Google from publishing sponsored links of advertisers representing an association, sponsorship or affiliation where one does not exist
- injunctions restraining Google from publishing search results that do not expressly distinguish advertisements from organic search results
- orders that Trading Post and Google implement trade practices compliance programs
- an order that Google publish a notice on its website outlining the above, and costs.
"Google Australia believes that these claims are without merit and we will defend against them vigorously. They represent an attack on all search engines and the Australian businesses, large and small, who use them to connect with customers throughout the world," said Google Australia spokesperson Rob Shilkin.
A Directions Hearing in Sydney is set for August 21 in front of Justice Allsop.