Original URL: http://www.theregister.co.uk/2007/10/12/ait_sues_fpc_over_click_fraud_and_internet_defamation/

Onetime Google nemesis cranks click-fraud crusade

Among other things

By Cade Metz

Posted in Law, 12th October 2007 01:39 GMT

Advanced Internet Technologies once took Google to court over click fraud. But that was small potatoes.

Now, the Fayetteville, North Carolina web hoster is locked in litigious combat with a net-happy local newspaper that allegedly hit the company with a click scam from inside its own data center. And alleged click fraud is just a start. There's alleged online defamation too.

AIT was the lead plaintiff in a 2005 California class action suit that accused Google of doing relatively little to prevent click fraud on its AdSense advertising network. Google eventually settled a similar class action in Arkansas, and though the search giant ponied up 90 million smackers to compensate click fraud victims and their lawyers, no cash ever went to AIT - something the company is still upset about.

In short, Google paid $30m to an army of attorneys and set aside $60m in AdSense credits for companies complaining of fraud. But AIT had no interest in AdSense credits. "Imagine walking into a restaurant and getting food poisoning," CEO Clarence Briggs told The Reg. "And then the restaurant tries to make things right by giving you half a dozen coupons for more food."

Click fraud crusader

Briggs claims that his company lost up to $500,000 while advertising on AdSense, a Google-run network of third-party websites. When advertising on the network, you typically pay if someone clicks on your ad, and the fee is split between Google and the third-party site where the click occurred. But some sites have been known to rig the system, artificially boosting fees by clicking on ads themselves.

Google told us that across all of its ad systems, less than ten per cent of the clicks are fraudulent. And that dates back to 2002. Meanwhile, Briggs claims that he saw fraud rates as high as 50 to 60 per cent in 2005, and research firm ClickForenics says the rate across all "search engine content networks," including AdSense and the Yahoo! Publishers Network, is 25.6 per cent.

"There are a number of different third-party estimates out there," said Shuman Ghosemajumder, business product manager for Google's trust and safety division. "Some of them are higher than ten per cent and some of them are actually lower."

Even after handing out that $60m in credits set aside by the Arkansas settlement, Ghosemajumder told us, Google continues to credit advertisers whenever fraud is identified. But Briggs doesn't want to hear it. He says that Google refused to hand him a single credit while he was advertising on AdSense, and he vows never to use the network again.

Meanwhile, he continues to advertise on other networks, and he's still crusading against fraudulent clicks. AIT runs an anti-click-fraud site called IGeryon.com, and the company is planning a new breed of search engine designed to put a stranglehold on such scams. If you're scamming AIT, be very careful. Especially if you're doing it inside the company's data center.

Observing The Observer

In November of 2005, just before it took over as lead plaintiff in that Google class action, AIT told local police that the Fayetteville Publishing Company (FPC) - publisher of the hometown Fayetteville Observer - was running a click fraud scam against the company. From inside AIT's data center.

"[AIT] has placed and continues to place a significant amount of online advertising on the Fayetteville Observer's web site," the police complaint read. "AIT is also the technology company which provide co-location for the Observer's servers, and when AIT grew suspicious that it was being over-billed for advertising, AIT as the web-host was able to monitor web traffic to and from the Observer's web site."

In this case, AIT was advertising directly with FPC. There was no Google-like middleman. AIT claimed that up to 50 per cent of ad clicks coming from The Observer's site were "manufactured" by a server inside their data center.

"AIT received fraudulent impressions and clicks from the same IP address in rapid succession over and over, often originating from foreign countries and generated by malicious systems designed to automate and inflate clicks."

A few weeks later, FPC filed a civil action against AIT at the county courthouse, claiming that the web hoster had nabbed its servers and wouldn't give them back. Then AIT filed a counterclaim and went public with its accusations against FPC on its anti-click-fraud site.

But it gets better.

'We don't suck'

Eventually, the case was dismissed and the servers were returned to FPC. But AIT appealed and requested a restraining order to prevent FPC from tampering with the servers. The case is still up in the air. But now there's a new one.

As part of a settlement in a completely separate legal action, AIT recently nabbed control of the websites www.aitsuck.net and www.aitsucks.net.

"Just like Dell and WalMart, we were lucky enough enough to grow to the point where someone started a sucks site about us," Briggs said. "We sued and settled with the folks that were hosting these sites and got all the server logs."

Well, AIT has now filed yet another suit, claiming that FPC - including at least one Observer reporter - used these sucks sites to post defamatory comments about the company. "We were shocked and disappointed to see that a lot of the postings were done by FPC anonymously," Briggs continued. "We were able to backtrack their IP address."

When we contacted FPC about the matter, the company referred us to its lawyer, who did not return our calls. It's a shame really. We'd love to hear more. ®