This week, the High Court unanimously ruled in favour of Google after a six-year legal battle with the ACCC over the display of certain internet search results.
The ACCC claimed that particular “sponsored links” conveyed misleading and deceptive representations, and that by publishing or displaying those links, Google was engaging in such conduct in contravention of the Australian Consumer Law. Advertisers paid Google to display advertising text in the sponsored links, and direct users to a website of the advertiser’s choosing. For example, a search for Honda Australia would show a paid advertisement for a Honda competitor, CarSales. The ACCC alleged the ads were deceptive, as they suggested CarSales was linked to Honda, and that Google was responsible.
The High Court, disagreeing with the Full Court of the Federal Court, held that Google did not create the sponsored links that it published or displayed, that ordinary and reasonable users would have understood that the representations were those of the advertisers, and would not have concluded that Google adopted or endorsed them.
The decision is positive for technology companies, as it limits their liability for actions by users of their technology; Google was found not liable for the misleading advertisements run through AdWords despite the fact that the ads were put up by Google and were created using Google’s tools. The advertisements were still deemed misleading and deceptive, but that Google was not responsible – it remains the case that all businesses involved in placing advertisements on search engines must take care not to mislead or deceive consumers.