ACCC drops case against Google subsidiaries

Australia's consumer watchdog withdraws claims against Google's foreign subsidiaries, must now resubmit claims against Trading Post and Google Inc

The Australian Competition and Consumer Commission has discontinued proceedings against two of the four respondents in it's case against Google and the Trading Post Australia which alleged that Google failed to distinguish between sponsored and 'organic' search results.

At the Federal court in Sydney on Thursday, the ACCC dropped its claims against the Third and Fourth respondents in the case: Google Australia Pty Ltd and Google Ireland Ltd.

This leaves Trading Post Australia Pty Ltd and Google Inc as the remaining respondents.

When the matter was last heard before the court, Justice Allsop labeled the ACCC's original statement of claim as vague and "repetitious".

Google's Counsel, Anthony Bannon SC, successfully argued for orders that the ACCC file summaries of it's claims against each of the four parties.

In Thursday's hearing, Allsop said that the ACCC's revised claims had been expressed with "admirable clarity".

However, Bannon had previously pushed for the motions against Google Ireland and Google Australia to be dropped, as their involvement as foreign subsidiaries of Google Inc aroused complications regarding international jurisdiction.

On Thursday morning that proposal became a reality, as the ACCC's counsel discontinued it's motions against Google's Australian and Irish subsidiaries.

Justice Allsop instructed the consumer watchdog to file an amended statement of claim regarding the remaining respondents, Google Inc and the Trading Post Australia Pty Ltd, by November 8.

"The ACCC's whole case, as we understand it, is based on results being listed in specific order... how that is going to be rationalised into a sensible statement of claim, we'll wait and see," Bannon told Justice Allsop.

Bannon said the ACCC's original claim didn't distinguish between sponsored links on the right and left hand sides of the page, and that its revised claims were still unclear.

"The ACCC has flipped, now they are saying sponsored links on the right hand side of the page are misleading as well."

However, Allsop replied that the claims against Google Inc were now "fairly straightforward".

Pending the court's consideration of the ACCC's revised statement in November, Google Inc will have another opportunity to file for discontinuance of proceedings at a further directions hearing scheduled for November 16.

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