THE travel industry – among the biggest users of search engine marketing – will be closely watching legal action the Australian Competition and Consumer Commission is taking against Google and Trading Post.
The ACCC alleges the companies engaged in "misleading and deceptive conduct" during a paid search campaign designed to direct take business from websites competing with Trading Post.
It alleges that Trading Post contravened the Trade Practices Act in 2005 when the business names "Kloster Ford" and "Charlestown Toyota" appeared in the title of Google sponsored links to Trading Post’s website.
By allowing this to happen, Google has also been accused of breaching the act, while the ACCC also claims the search giant, by failing to adequately distinguish sponsored links from "organic" search results, has engaged and continues to engage in misleading and deceptive conduct.
The ACCC 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 an 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 pay costs
The matter has been listed for a directions hearing in the Federal Court, Sydney, on 21 August 2007 before Justice Allsop.
This is the first action of its type globally. Whilst Google has faced court action overseas, particularly in the United States, France and Belgium, this generally has been in relation to trademark use.
Although the US anti-trust authority the Federal Trade Commission has examined similar issues, the ACCC understands that it is the first regulatory body to seek legal clarification of Google’s conduct from a trade practices perspective.
Travel Trends: July 20, 2007