8 Feb 2013

Google not responsible for misleading conduct by advertisers

Submitted by Troy Rollo

Google v ACCC [2013] HCA 1

ACCC accused Google of misleading conduct because of ads on the search engine that inserted keywords from the user's search into the link for the ad, including in some cases competitor trademarks. It was not disputed that the ads were misleading. Google one at first instance. On appeal to the full court, the appeal was unanimously allowed, with the full court saying that because the software written by Google constructed the ad, Google was engaging in the misleading conduct. The High Court unanimously allowed the appeal to it, ruling that Google did not engage in misleading conduct.

French CJ, Crennan J and Kiefel J found that Google's software did not author the ads (apparently echoing Acohs v UCorp), and so Google did not make the representations alleged. That being the case, it was left to consider whether Google adopted or endorsed the representations. As the trial court found that Google user would understand the ads to be ads and would not construe Google as endorsing or adopting, they found there was no misleading conduct by Google.

Hayne J found that Google did not make any representation, because Google users would understand the representations to be those of the advertiser. He then went on to say that Google might have engaged in misleading conduct by publishing the ads, but as ACCC pleaded representations the appeal had to be allowed.

Heydon J found the proposition that Google could be liable for misleading content served up as ads unless it could make out the publisher defence to be an unacceptably extreme position, and that as users understood the ads were ads, there was a necessary implication that Google did not adopt or endorse them. He also seemed to find the proposition that Google could be liable for misleading conduct, because the advertiser chose to abuse the keyword insertion feature, to be preposterous, and to think that if Google was liable for misleading conduct in ads, it might also be liable for misleading conduct in its automatically generated search results.