Google defeats part of US shareholder class action over digital ads
March 25 (Reuters) - Alphabet's Google (GOOGL.O), opens new tab convinced a federal judge in San Francisco to dismiss part of a lawsuit that accused the tech giant of misleading investors about its digital advertising practices and user privacy protections.
In a ruling, opens new tab on Monday, U.S. District Judge Rita Lin said the shareholders in their proposed class action did not adequately support their claim Google made false statements on its website about its practices.
Lin said the plaintiffs could move ahead with their claim that a 2020 written statement that Alphabet chief executive officer Sundar Pichai made to Congress was false.
The shareholders, who sued Google in 2023, contend Google had rigged online advertising to favor bids from Google-owned platforms or through a network agreement that Meta's (META.O), opens new tab Facebook had with Google.
The lawsuit alleged Google committed securities fraud through public statements that characterized the ad market and its auction-based system for selling ads as highly competitive.
Lawyers for the plaintiffs did not immediately respond to a request for comment.
Google in a statement on Tuesday said it "runs a fair first-price auction, no matter where the bid comes from." The company has denied, opens new tab any wrongdoing.
Monday's order said the investors had not proven Google acted with the necessary 'state of mind' in some statements.
Lin said a company does not commit securities fraud 'every time there is a significant error somewhere on its website that is inconsistent with facts known to the CEO.'
'Under plaintiffs' theory, Pichai's role as CEO makes him the de facto 'maker' of every single statement on Google's website. This is not the law,' Lin wrote.
Google is defending against other lawsuits challenging its digital advertising practices.
A U.S. judge in Virginia presided over a trial last year in a case brought by the U.S. Department of Justice and a group of states, but has not yet ruled. Google has denied the allegations.
The case is AMI – Government Employees Provident Fund Management Company v. Alphabet Inc. et al, U.S. District Court, Northern District of California, No. 3:23-CV-01186-RFL.
For plaintiffs: Jeremy Lieberman and Emma Gilmore of Pomerantz
For defendants: Boris Feldman and Doru Gavril of Freshfields
US drops bid to make Google sell AI investments in antitrust case
Google asks US appeals court to overturn app store verdict
Google must face part of US consumer lawsuit over search dominance
Google's US antitrust trial over online ad empire draws to a close
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Daily Mail
2 hours ago
- Daily Mail
Hertz faces boycott over AI scanners that can slap $400 fines in minutes
By Published: | Hertz is facing a wave of online backlash. Critics are taking aim at the rental company after multiple customers say they were billed hundreds of dollars for minor damage flagged by new AI inspection scanning systems. On Reddit and Facebook, car renters are now calling for a boycott, accusing the rental giant of using AI to detect trivial damage and charge steep fees — all while making it difficult to speak with a live agent. 'I'm just not comfortable with the new technology that can flag dirt or something that can be rubbed off as damage,' A customer posted on Reddit. Another Reddit user wrote: 'The flagging is half of the problem. The other problem is Hertz using AI to file the claim. What about traditional smaller-than-the-size-of-a-golf-ball dents or bill-size scratches? I can't even speak to a live agent.' This week, the company confirmed to it had charged a driver $440 for a one-inch scratch on a wheel. The scuff, commonly caused when a driver brushes a curb while parallel parking, was flagged by the scanner. The bill included $250 for the damage, $125 for processing, and a $65 administrative fee. Another driver claimed they got a $195 fee for a tiny dent when returning a Toyota Corolla. Each driver's experience is part of a larger tech rollout at Hertz, which recently partnered with UVeye , a startup that builds high-speed automated vehicle inspection systems. Renters drive their cars through the scanners twice: once when they pick up the vehicle, and again when it's returned. Drivers will receive a copy of previously-scanned damage, the company confirmed to Hertz wants to use the scanners at 100 rental locations by the end of the year. In April, the rental firm told that it was rolling out the tech to enhance vehicle safety, not charge customers for minor cosmetic damage . The company said its policy hasn't changed, despite the $440 and $195 charges. It says most drivers who have used the UVeye scanners haven't received a charge. 'Over 97 percent of cars scanned with this technology have not detected any billable damage, proving a vast majority of rentals are incident-free,' a spokesperson for the company said. 'Vehicle damage has long been a common pain point across the car rental industry for customers and companies alike. 'At Hertz, we're using this technology to address this friction head-on and our goal is to always improve the customer experience while ensuring customers are not charged for damages they did not cause and by bringing greater transparency, precision, and speed to the process when they do.' In April, the company also told that the systems will ensure their customers always receive safe cars. UVeye's scanners can more accurately assess underbody damage and tire tread degradation than human inspectors. But independent analysts worry the tech solution isn't inspiring a ton of human trust. 'A line is crossed when AI applications become overly aggressive and prioritize efficiency over customer fairness and satisfaction,' David Linthicum, an AI analyst, previously told 'Customers value fairness and human interaction.' Hertz declined to comment on this article. Instead, the company pointed to its loss damage waiver, which typically costs between $20 and $30 per rental day, as a way to avoid surprising fees.
Daily Mail
4 hours ago
- Daily Mail
Trade war escalates: Canada hikes duties as Trump halts negotiations
The response came hours after Trump posted on Truth Social about how Canada is a 'very difficult country to trade with.' His reason for suspending trade negotiations came down to a tax Canada is set to impose on major tech companies starting Monday. 'Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately,' Trump wrote, adding that the levy 'is a direct and blatant attack on our Country.' Last week, the finance minister said he would not delay the implementation of the digital services tax, which applies to any firm making more than $15 million from Canadian internet users. The three percent tax will strike at the heart of American companies like Amazon, Google, Meta, Uber and Airbnb. And because the tax is retroactive back to 2022, one tech lobbying group said American firms will soon have to pay up to $3 billion directly into Canada's treasury. Canada has not ruled out further action to strike back at Trump for ending negotiations, with the government saying it 'remains prepared to take additional steps as needed.' How Canada's hike on US steel imports will affect the industry, which has been struggling for years, is yet to be seen. US Steel Corporation, once one of the most valuable companies in the world, just merged with Japan's Nippon Steel earlier this month after years of declining sales. Canada is also hugely impacted by Trump's 50 percent tax on steel and aluminum imports, as the country is largest foreign supplier of those materials to the US. Canada's steel industry has laid off a staggering 1,000 workers since the first US tariffs in March, Reuters reported. It has also been impacted by the 25 percent duties Trump has levied on foreign-made vehicles and parts.
Telegraph
4 hours ago
- Telegraph
‘Stop hiring humans': Customer service under threat as robots take hold
Workers commuting on the London Underground have been confronted with a terrifying message in recent weeks. Scrolling digital adverts, displayed on the Tube's escalators, have urged businesses to 'stop hiring humans' and use artificial intelligence (AI) robots instead. The spooky messages are the work of Artisan, an artificial intelligence (AI) start-up, which launched the guerrilla-marketing campaign to promote its AI software. But the ads have hit a nerve with London's commuter class, tapping into deep-seated fears that fake human workers are coming for their jobs. Hundreds of businesses across the country are now deploying AI workers instead of people. But instead of a brave new world of efficient robotic workers, there are mounting fears that the increased use of AI and chatbots will simply make things worse for customers and workers. Daniel O'Sullivan, a customer service analyst at Gartner, says consumers have justifiably had concerns about the rise of AI because 'chatbots have historically sucked'. Lisa Webb, a consumer law expert at Which?, says: 'Not all chatbots are built equally. While some can be helpful, others can send customers round in circles and make it difficult for them to get their issues resolved.' Replacing drudge-work For managers looking to cut costs, the pitch to replace human workers with AI software is compelling. On Artisan's website, it pitches 'your future colleagues' – Aria, Ava and Aaron – and promises customers they can get results 'without increasing headcount'. For now, Artisan is targeting the drudge-work of business sales, helping companies to automate outbound cold emails and the initial conversations with potential clients, work normally done by a very junior sales worker. The start-up is not yet dealing with consumer-facing customer service roles, which Jaspar Carmichael-Jack, Artisan's 23-year-old founder, says raise 'more issues' and risks. In the context of a business transaction, there may be little to lose with using AI to automate and personalise thousands of cold call pitches, job adverts or PR emails which may never get opened. But when it comes to interactions with consumers, 'the error rate is too high across the board', Carmichael-Jack says. 'That is why people have this anti-AI sentiment.' That has not stopped hundreds of businesses using AI worker and experimenting with AI customer service, whether the public wants it or not. Dozens of technology businesses have promised AI helpers that can smooth over customer service functions. These include AI bots from start-ups like the UK's PolyAI, which bills its technology as the 'most lifelike' voice agents, to tech giants such as Salesforce and its 'Agentforce' bots. High-profile businesses such as Klarna, the buy now, pay later provider, have already raced to replace jobs once taken by humans with AI bots. A question of quality But so far, these fake humans have produced mixed results. In some cases, companies have completely reversed course. At Klarna, Sebastian Siemiatkowski, the chief executive, went all in on AI chatbots such as ChatGPT, seeking to swap human-led customer service for AI, dramatically cutting jobs. However, in an interview earlier this year, the Swedish company's boss admitted this AI zeal had not worked out. 'What you end up having is lower quality,' he told Bloomberg, adding that 'investing in the quality of the human support is the way of the future for us'. So far, the public is not sold on the idea that AI agents are going to lead to an improvement in customer service. A survey from Gartner, published last year, found that 64pc of people would prefer it if companies did not use AI in customer service interactions at all, and 60pc feared it would make it harder to speak to a human – putting up an AI middleman. And there are plenty of examples of early attempts at AI-powered customer service getting it wrong. In 2024, a DPD chatbot swore when prompted by users and told customers that 'DPD is useless' and 'don't bother calling them'. In April this year, an AI support bot called Sam for the code editor app Cursor went rogue. After users found a bug within Cursor's service that booted them out when they tried to log in from multiple machines, Sam told customers that this was part of a new policy. Users were not aware that Sam was a bot, leading some to threaten to cancel their subscriptions. And last year, Air Canada was forced to honour a refund after its website's chatbot invented a policy when interacting with a customer. Generative AI-powered chatbots, which are trained to speak in plain English, suffer from a problem known as 'hallucination', whereby the AI will sometimes simply make up information if it does not know the answer. These bugs in customer service bots risk driving consumers away. A survey from customer service firm Acquire Intelligence found that 70pc of consumers would take their business elsewhere if they were let down by a bot. Such errors and risks mean that some companies that were among the first movers to try out AI agents as a replacement for human workers are already winding back. In a survey published this month, Gartner found that half of companies that were planning to replace their customer service staff with AI were considering abandoning the plans. 'AI agents' However, O'Sullivan predicted that rapidly advancing technology and changes in customer expectations mean the shift to AI workers is unlikely to stop completely. 'Perceptions here are changing very quickly,' he says. 'Even in the space of one year, we have people becoming more accustomed to using AI.' He added that when it comes to customer service woes, people want their problem solved, and the 'means through which they solve the issue is not necessarily the most important thing to them'. If bots get more effective than a human, consumers could quickly decide they prefer them to speaking to a real person. If the tech industry is to be believed, this shift is just around the corner. Increasingly advanced 'AI agents' – big tech's latest buzzword – are supposed to be able to take on ever more complex tasks from human workers. While customer support bots once could only provide basic question and answer functionality, agents will be able to draw information from across a business and function more autonomously. 'Customer frustration with traditional chatbots has typically stemmed from the tools' limited capabilities,' says Heidi O'Leary, a partner at Deloitte Digital. 'Agentic AI goes a step further, allowing these assistants to take actions on a customer's behalf – for example, initiating a return or refund without human intervention.' For now, she says the most successful uses of AI in customer service have kept humans in the loop, using AI as a tool to boost the performance of human staff, for instance, by quickly drafting emails or notes. Artisan's Carmichael-Jack says AI bots are 'not currently as effective as a human in a lot of use cases'. But this is rapidly changing, with tech companies building more accurate AI bots and attempting to instil 'reasoning' in them. He expects perceptions of AI employees to 'shift over the next couple of years because we know it is going to get it right'. In the near future, he expects that people would 'rather be put through to AI than to an offshore call centre. People will want to speak to an AI agent and you will be that annoyed if you are put through to a human'.
