With Amazing Chutzpah Google Claims It Can’t Be Sued In UK Courts

Google legalLast year Google was embroiled in controversy over its circumvention of the Safari browser’s cookie-privacy settings (on the iPhone and beyond). As a result the company paid a $22.5 million fine to settle the case with the US FTC approximately a year ago.

The FTC summarizes the facts that lead to the settlement:

[F]or several months in 2011 and 2012, Google placed a certain advertising tracking cookie on the computers of Safari users who visited sites within Google’s DoubleClick advertising network, although Google had previously told these users they would automatically be opted out of such tracking, as a result of the default settings of the Safari browser used in Macs, iPhones and iPads. 

According to the FTC’s complaint, Google specifically told Safari users that because the Safari browser is set by default to block third-party cookies, as long as users do not change their browser settings, this setting “effectively accomplishes the same thing as [opting out of this particular Google advertising tracking cookie].”  In addition, Google represented that it is a member of an industry group called the Network Advertising Initiative, which requires members to adhere to its self-regulatory code of conduct, including disclosure of their data collection and use practices.

Despite these promises, the FTC charged that Google placed advertising tracking cookies on consumers’ computers, in many cases by circumventing the Safari browser’s default cookie-blocking setting.  Google exploited an exception to the browser’s default setting to place a temporary cookie from the DoubleClick domain.  Because of the particular operation of the Safari browser, that initial temporary cookie opened the door to all cookies from the DoubleClick domain, including the Google advertising tracking cookie that Google had represented would be blocked from Safari browsers.

Those same facts lead to a civil lawsuit in the UK by Apple users, which was filed earlier this year.

Now Google is moving to dismiss the UK case on jurisdictional grounds, arguing that it is not subject to UK privacy laws and that plaintiffs must refile their case in California where Google is based. Google argues, essentially, that UK courts have no jurisdiction over the company.

Making that claim involves a lot of chutzpah (audacity, not guts) on Google’s part.

Under US law foreign companies can be sued if they’re “doing business” in the country or a particular state. There are some additional technical requirements but basically if you’re operating in the US you’re going to be subject to US (and possibly state) laws under so-called “long arm jurisdiction” statutes.

If the tables were turned and Google were a UK company doing business in the US, it could never successfully make the argument it’s trying to make in the UK now. Google’s lawyers know this of course.

Google argues that UK nationals must come to the US and sue Google for privacy violations that happened on British soil. Would then Google argue that US and not UK law should be applied in the case as well? That’s what Google seems to be arguing.

The implications are pretty stunning. Playing them out, it would mean all international disputes involving US-based internet companies would have to be brought in the US and would be governed by US law.

For this reason there is almost zero chance that the UK court will accept and agree with Google’s argument. Doing so would be to effectively deprive UK courts of any authority over Google’s actions or policies in the country. It would, as a practical matter, give Google a sort of “diplomatic immunity” in the UK.

I would thus be shocked if the UK court went along with this.

The UK’s data protection authority apparently can only apply a fine of up to £500,000 ($782,000). The civil claimants’ counsel argues that such minuscule fines would have little impact and that a civil suit is necessary to not only compensate victims but also punish and deter Google from similar “bad behavior” in the future .

Related Topics: Channel: Industry | Google: Business Issues | Google: Cars | Google: Critics | Google: Legal | Google: Mobile | Google: Outside US | Legal | Legal: Privacy | Legal: Regulation | Top News

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  • Pat Grady

    I thought Google was in Ireland, and just leased it’s Intellectual Property to its subsidiary in the USA?

  • yolokoloswaggins

    Google will fall in less than 10 years because the new CEO, Larry Page is just a greedy tool. He’s a Steve Jobs wannabe and all he can do is just slap more ads into search results. It’s where his “innovative thinking” begins and ends – to increase number of adwords of results from 3 to 4 per page. Innovative genius – Google is where the magic happens.

  • Truthhz

    A UK civil lawsuit is completely justified. With $48 billion in bank, does anyone really think a $782,000 UK fine would deter Google’s behavior?

    Google should take it’s medicine and settle lawsuit. Legal maneuvering won’t endear them to UK or EU.

  • antifud

    you guys are so full of it that it’s amazing.

    Why don’t you admit you hate that google exists and that you have to compete with them?

    your argument has exactly zero merit. Let me copy from Groklaw the complete debunk of this entire article:

    It’s not chutzpah. It’s quite normal to make that argument in international cases. Can Google be sued in Iran under Iranian law? How about North Korea? Let’s make the question a little closer to home. Let’s say you are being sued by someone in Iran. You don’t live in Iran. You live in the US. Now how do you feel? Do you wish to be under the laws of every disparate nation in the world? As this class on jurisdiction points out, in Saudi Arabia there is a death penalty for adultery. Do you want to be liable under that law if you are a US citizen living in the US? Can Saudi Arabia come and stone you? How would the internet work if it was the law that companies are liable under each and every country’s laws, regardless of the obvious contradictions, and could enforce its rulings everywhere in the world? Would anyone set up an online business in such a situation? I wouldn’t. How about China? Shall we accept limitations that it imposes on its citizens as limitations on US citizens also?

    I know it’s popular to attack Google, but really it’s quite normal to be sued where you are in business. Terms of use, which users accept, usually, typically tell you where you can sue. There are some exceptions, such as in cases of libel, where one can argue that you want it tried where the harm was done to the plaintiff, but even then, it’s quite typical to see jurisdictional assertions at least raised. It’s not only not chutzpah to do that, it’d be malpractice not to. The first time a country asserted jurisdiction over the Internet, Australia, it was big news. That’s how unusual it was to even try to assert jurisdiction over a US company under another country’s laws. Do you want to accept Germany’s laws about not speaking about Hitler favorably? Does Germany get to annul America’s First Amendment in the US? Do you see the complexity that ensues if a company can be sued anywhere and everywhere? If a country can claim jurisdiction over another country’s territory? It is *normal* to sue where a company is headquartered. Google may or may not succeed, but it’s certainly not chutzpah to argue that it should be sued where it is located”

  • millenialkid

    Great point!

    Over the years, I also think Google thought if it didn’t charge for it’s internet services, no direct trade would occur, making it exempt from various forms of trade dress and trade law; and limiting questions of law to that of a b2b flavor.

  • Truthhz

    Surely you can make an impassioned defense of Google without invoking “Godwin’s Law”. (Hitler and stoning mentioned in one argument!)
    Google violated privacy of users. They should work to settle lawsuit. It’s the right thing to do. If you want to ask, what is the slimy corporate counsel move to take, that is another question. Executing case in UK will not bring on stonings or the rise of the Third Reich.

  • Dean Rowe

    if I wanted to do business in Iran or North Korea then I’d have to comply with their laws, including getting sued in their courts. If you don’t want to get sued in the UK courts, don’t operate in the UK. Pretty straightforward really.

  • antifud

    missing the entire point – the internet does not follow the laws of every country, and never has. What if you refuse service to china, but people still access it via VPN? Are you still responsible for complying with the laws?

    What if you *only* serve the US? Except that it’s the internet, so the entire world can access your site. Do you then have to follow their rules? Hint: no.

    I don’t think you understand how impossible it is to do so.

  • antifud

    except that this isn’t about hitler, you are pulling that out of, well, nowhere. I don’t see how this is a slimy move, either. The article is quite full of impartial views, to say the least.

    The point is, there is a lot of caselaw and fact behind that you only have to follow the laws of the country the company is based out of. That’s why people set up shop in favorable countries *such as* the US. At the moment I believe a country (china? thailand?) said that blogs can no longer be about news, or something to that effect. Say you’re in the news blogging business. Now what?

    If you followed China/thailand law then, you’d have to simply shut down your blog. Are you going to tell me that refusing to do so is a slimy move?

    How hard is that to understand?

    Example: US codifies fair use and free speech, which lets people be a lot more free with what they say. Would you rather deal with that, or the UK where you can be sued just because someone else doesn’t like what you say?

    your lack of common sense is showing.

  • Dean Rowe

    moving below

  • Dean Rowe

    :)

    If you setup a site selling a digital download and someone in Iran downloaded it and then tried to sue you then yes, I would say you have a point. (this is when a T&C’s page comes in handy).

    But if you setup a site with a uk ccTLD (oh I don’t know, like google.co.uk) then I think it’s pretty clear that your intent is to sell into that market and you should adhere to that country’s laws.

    If you don’t like those countries laws then don’t try and operate there. Simple.

  • ajay

    google and apple is now fighting like mouse and cat. If they concentrate on making some good technology both will benifited rather than fighting
    Website development company in delhi

  • antifud

    “setup a site”?

    just because you buy a domain name that ends in another country’s TLD doesn’t mean you’re operating there or subject to anything, aside from the potential whims of someone trying to seize/control that specific domain name.

    In fact, they can’t even seize/control any of your other domain names. So no, it doesn’t work that way. It’s more “thinking we can sue over anything we want”, as a result of the US’s own actions that are encouraging the rest of the world to be more litigous.

    Any aspect of “google can/should be sued here to comply with UK law” is explicitly facetious.

    Also, these issues are anything *but* simple. What happens if they sue you for more than your business makes in a country, for example? What if they find you guilty of violating some law in a country you’re not forced to follow said laws? Are they going to go after you in the US? Shades of megaupload.

  • http://www.michaelmerritt.org/ Michael Merritt

    Google has offices in the UK in what appears to be setup as a UK subsidiary. How does the law apply in that case?

  • antifud

    That’s *the* question at the core of the case, really. Not “google has chutzpah”.

  • anonimouse

    You might think that, but the argument with regard to domain names establishing jurisidiction has been used with respect to poker sites in the US. I even believe that judgements along such lines have been upheld. I think Google has a perfect right to raise this defense, but I think UK courts will tell them what to do with it

  • Dean Rowe

    But we’re not really talking about just “buying” a domain name now are we? Google have bought a .co.uk domain, AND… set up a site which auto-redirects any request from a UK IP address to that site, built offices in UK, recruited sales teams contacting UK businesses, produced UK marketing campaigns in print, on billboards, on the tubes etc, generated £395m in UK turnover in 2011… I’m pretty sure however you look at it that that classifies as “operating” in a country.

    “What happens if they sue you for more than your business makes in a country” – so what? Since when does profit override liability? If I produce an electrical appliance which doesn’t comply to a country’s safety laws, sell it in that country and it promptly burns a family home to the ground, should my liability be restricted to the £10 profit I made on it?

    If you don’t like the laws of a country, don’t operate in that country and cry foul when you’re called to account for your actions in that country’s courts of law. US laws were not voted on and approved by the people of the UK, they shouldn’t apply to companies operating in the UK. It. really. is. that. simple.

  • Truthhz

    You mention ridiculous examples to inject FUD into this argument. What UK law is so egregious that it requires Google to move case? Or is it more likely that Google’s intention is to make it harder for plaintiffs to file action? I’d say the latter.

  • Truthhz

    You mention ridiculous examples to inject FUD into this argument. What UK law is so egregious that it requires Google to move case? Or is it more likely that Google’s intention is to make it harder for plaintiffs to file action? I’d say the latter.

  • http://dragonsearchmarketing.com/ Ric Dragon

    Antifud – I’m with you on this on – it is perfectly normal for companies to go through the legal steps of asking for dismissal based on grounds of technicalities such as jurisdiction – hardly “chutzpah.”

  • http://dragonsearchmarketing.com/ Ric Dragon

    Antifud – I’m with you on this on – it is perfectly normal for companies to go through the legal steps of asking for dismissal based on grounds of technicalities such as jurisdiction – hardly “chutzpah.”

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