Google Avoids $2B Penalty in User Data Lawsuit

Key Ruling Overview

A U.S. federal court has denied a request to impose an additional $2.36 billion penalty on Alphabet's Google. This ruling is a significant development in a class-action lawsuit concerning the company's collection of user app activity data.

Case Background and Details

In a prior verdict from September, a jury found Google liable for collecting data from users who had disabled the 'Web & App Activity' setting, awarding plaintiffs approximately $425 million in damages. Following this, the plaintiffs sought the disgorgement of an estimated $2.36 billion in profits Google allegedly gained from the practice.

Financial and Legal Implications

Chief U.S. District Judge Richard Seeborg rejected the penalty, stating the plaintiffs failed to demonstrate irreparable harm and that their profit calculations were insufficiently supported. This decision averts a substantial financial blow to Google and prevents a permanent injunction that could have disrupted its ad-related data practices. Google maintains it will appeal the original jury verdict.

Summary and Outlook

While Google has successfully avoided this multi-billion dollar penalty, the company still faces the initial $425 million verdict, pending its appeal. The case underscores the increasing legal and financial risks associated with data privacy practices for major technology corporations, a trend that investors and regulators are monitoring closely.

FAQ

Q: What was the lawsuit against Google about?
A: The lawsuit accused Google of secretly collecting app activity data from millions of users who had turned off a specific tracking feature in their account settings.

Q: Did Google have to pay any penalties?
A: A jury previously ordered Google to pay about $425 million in damages, which the company plans to appeal. The recent ruling only rejected an additional penalty of over $2 billion.

Source: Investing.com