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Mar 20 2006
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KinderStart Take 2
So I've now scanned the complaint (reminding me of why I left litigation). This case appears to be substantially about lost AdSense revenues:

On March 19, 2005, Plaintiff KSC�s Website kinderstart.com suffered a cataclysmic fall of 70% or more in its monthly page views and traffic. Thereafter, KSC.com�s monthly average of page views for the last 11 calendar months through February 2006 was a meager 30% of monthly levels prior to March 2005. Initially, KSC did not know why its Web traffic had dropped so dramatically � it had not been provided any notices, and certainly no advance notices, whether or why its Web traffic might decrease. Eventually, KSC realized that common key word searches on Defendant Google�s search engine no longer listed www.kinderstart.com as a result with any of its past visibility.

By April 2005, Plaintiff KSC�s monthly AdSense revenue suffered an equally precipitous fall by over 80%. With the sharp fall-off in search engine referrals from www.google.com, quite naturally and automatically click-throughs for the sponsored ads on KSC.com would drop proportionately with the actual key word search traffic sent from Defendant Google.


Here is a very quick and incomplete summary of the claims:
  1. Violation of free speech rights under the U.S. and California constitutions: By blocking KinderStart, Google allegedly denied the company its free speech rights. (I think the legal basis for this claim is very dubious: "If I don't show up on page one of Google, my free speech rights have been violated!")
  2. Violations of the Sherman Antitrust Act/abuse of monopoly power (Google's got a big market share, but it's not a monopoly and hasn't acted in an anti-competitive way; search is the most competitive of industries)
  3. Two claims of unfair competition and unfair businesses practices under California law (these claims basically allege bad faith and deceptive manipulation of KinderStart's ranking and a related breach of contract argument)
  4. Breach of implied covenant of good faith and fair dealing (this claim basically alleges that the plaintiffs allocated "precious" Web real estate to AdSense ads and Google's alleged blockage of KinderStart denied them the benefit of traffic and thus AdSense revenues)
  5. Defamation and libel (among several ridiculous claims this is one of the most ridiculous; plaintiffs are effectively claiming the absence of their site on the first page of results is tantamount to defamation)
  6. Negligent interference with prospective economic advantage (and in this claim is the most telling of all the statements: "Defendant Google owed a duty of care to Plaintiff KSC to undertake all reasonable steps and actions to allow a continuous flow of referrals from the Google Engine onto the KSC.com website." This is just an incorrect statement.)

Google has no legal duty to guarantee the placement or ranking of any site. One might argue that Google does have a duty not to unfairly punish a site that isn't violating any of its policies � and the absence of clarity/transparency about what may or may not constitute punishable behavior may be a problem and need to be clarified. Also, the complaint reflects frustration and anger over not being able to communicate with Google and rectify the situation � something that may need to be addressed internally.

I'm not an AdSense advertiser and there may be some language in the Ts&Cs of the AdSense fine print that plaintiffs can use to make some plausible claims about Google's obligations. But on the whole this complaint seems to me to be sour grapes and grasping at straws rather than making any legally enforceable claims.

At the center of all this is the question: What do search engines owe the owners of the sites they index? I would argue courts aren't going to insert themselves into this question, the answer to which is probably only "clear policies." Also, Google is not a monopoly, which the complaint seeks to argue and thus bring it under federal antitrust law.

But the biggest strike against the plaintiffs here is the fact that ruling in their favor would embolden sites whose rankings had declined to litigate. In the high-stakes cat-and-mouse game of search engine rankings, it would create a sense of "ownership" or entitlement to those rankings. Again, this would effectively kill organic search.
 
Local Media Blog
posted by  Greg Sterling at  15:37 | comments [1] | trackbacks [1]


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posted by   Lucas Morea  [ http://www.latinedge.com ] Mar 21 2006 at 16:49
Great analysis Greg!

In my opinion this was also a (very successful) publicity stunt, just look at their spike in traffic according to alexa.com.

I wonder how much it cost them in legal fees to file this, and if that amount of money could have gotten them this much exposure!
 




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