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Google Being Sued Under Organized Crime Laws

Google, as well as Yellowbook and Ziplocal, are being sued by a locksmith who does business in Northern Virginia and Maryland.  The locksmith is citing multiple state and local laws, including the RICO Act (Racketeer Influenced and Corrupt Organizations) in the lawsuit, which is claiming $8.4 million in lost earnings and profit.

The main points made in the suit revolve around the fact that in both Maryland and Virginia all locksmiths are required to hold a license in order to do business.  There are a total of 150 locksmiths in Maryland and 425 in Virginia.  Despite this fact, Google and the other defendants allow non-licensed individuals and businesses to purchase ads on their sites.

The suit claims that this is done to help drive up the cost of the advertisements, which then requires licensed locksmiths to either pay higher rates for the ads, or lose business to the unlicensed advertisers.

Specifically, it says that the defendants, “knew [they were] publishing the names of hundreds of illegal locksmiths in Virginia and Maryland and deriving revenue, directly or indirectly, by doing so.”  In addition to just depriving the plaintiff of revenue and causing marketing costs up, the suit claims that running these ads has also harmed the public.

When someone is searching for a local locksmith, the plaintiff claims, they will assume that anyone advertising on one of these sites will be a legal locksmith.  The fact that Google and the other defendants display ads for unlicensed locksmiths puts residents in danger of hiring someone who may defraud them or be unqualified to do the job.

There is no court date set for this case yet.  In addition, Google has not released a statement on this matter.  They may end up trying to settle out of court to potentially save money and a bad reputation.  Whatever the case, this is another example of why anyone who runs ads on their site needs to be careful of what is claimed in the ads.

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Pesach Lattin

Pesach "Pace" Lattin is one of the top experts in interactive advertising, affiliate marketing. Pace Lattin is known for his dedication to ethics in marketing, and focus on compliance and fraud in the industry, and has written numerous articles for publications from MediaPost, ClickZ, ADOTAS and his own blogs.

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