Google faces £7 billion legal claim over search engine advertising

A £7 billion legal claim against Google which accuses the tech giant of exploiting its dominant position in the search engine market can proceed to trial, the Competition Appeal Tribunal (CAT) has ruled.

The multi-billion claim, brought by consumer rights campaigner Nikki Stopford, claims the US giant exploited its dominance in the search market to increase advertising costs, which were ultimately passed on to consumers.

The legal claim also accuses the company of abusing its position in the market by forcing mobile phone manufacturers who use Google’s Android operating system to pre-install apps for Google Search and the firm’s web browser, Chrome, on to handsets, and paying Apple to ensure that Google is the default search engine on its devices, including the iPhone.

As the class representative in the action, Ms Stopford will represent all UK-domiciled consumers aged 16 and over who purchased goods or services from a business selling in the UK which used search advertising services provided by Google.

The action is being brought as an opt-out collective action, meaning that everyone in the UK affected is automatically included as a claimant in the case unless they opt out.

“This green light from the tribunal is a significant victory for UK consumers,” Ms Stopford said.

“Almost everybody uses Google as their go-to search engine, trusting it to deliver quality results at no cost. But its service isn’t genuinely free because its dominance has resulted in increased costs for consumers.

“Google has been warned repeatedly by competition regulators. Yet it continues to rig the market to charge advertisers more, which raises the prices they charge consumers.

The decision is the latest setback for the tech giant, coming after the US Department of Justice proposed that the company be forced to sell its Chrome web browser, among other remedies, after a US judge ruled earlier this year that the business ran a monopoly in search.

In response to the CAT ruling, a Google spokesman said: ““We still believe this case is speculative and opportunistic – we will argue against it vigorously.

“People use Google because it is helpful; not because there are no alternatives.”