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Los Angeles – More than 40 online advertisers alleging that the nation’s top search engines conspired to overcharge them have filed objections in the past few weeks to unravel a recent $90 million proposed settlement with Google Inc. The online advertisers are potential class members of the Google settlement who allege in a nationwide lawsuit that the search engines did not do enough to prevent “click fraud,” which is the practice of running up advertisers’ bills by clicking repeatedly on their online advertisements. The proposed settlement, reached in March, would have ended the majority of click fraud-related liability claims against Google, which denied the plaintiffs’ allegations. Lane’s Gifts and Collectibles LLC v. Google Inc., No. CV-2005-52-1 (Miller Co., Ark., Cir. Ct.). Objectors say the proposed settlement is unfair and inadequate because it includes poor calculations, excessive attorney fees and e-mailed class notices that look like spam. “We’re in the midst of a heated campaign where we’ve exchanged everything short of gunfire to blow that settlement out,” said Darren Kaplan, a partner at Atlanta-based Chitwood Harley Harnes, who represents two objectors. A fairness hearing is set for July 24. ‘Unprecedented’ settlement Filed in February 2005, the class action alleges that Google, its business partners and other search engines charged two advertisers for fraudulent clicks in pay-per-click advertising programs. Although Google agreed to settle the case, claims still are pending against other defendants, including Yahoo! Inc.; Time Warner Inc.’s America Online; and Ask Jeeves, now Ask.com, which is owned by IAC Search & Media, a wholly owned subsidiary of IAC/InterActiveCorp. Kaplan said about 40 potential class members have objected to the settlement, which applies to advertisers claiming fraudulent clicks from 2002 to the final settlement date. Under the settlement, class members who contributed 10% of Google’s billions of dollars in revenue by paying for fraudulent clicks would receive compensation based on only 10% of the $60 million fund, or $6 million, he said in court papers. Such an undervalued settlement is “unprecedented,” he said. Irwin B. Levin, managing partner at Indianapolis-based Cohen & Malad, which filed an objection on June 15, said a better method of calculating the settlement would have been to base each class member’s individual settlement award on a standard presumptive percentage of clicks that were fraudulent. He noted that the settlement also paid potential class members in advertising credits, not cash. Google’s lawyer, Daralyn Durie, a partner at San Francisco-based Keker & Van Nest, referred calls to Steve Langdon, a spokesman for Google who did not return a request for comment. Calls to the half-dozen law firms that drafted the $90 million settlement with Google were not returned or were referred to lead lawyer George L. McWilliams, a partner at Patton, Roberts, McWilliams & Capshaw in Texarkana, Texas. McWilliams did not return calls. Kaplan and another lawyer representing an objector, Brian Kabateck, a partner at Los Angeles-based Kabateck Brown Kellner, said they would like to see a settlement more like the one they drafted in a separate click fraud class action case against Yahoo in California. Checkmate Strategic Group Inc. v. Yahoo! Inc., No. 05-cv-04588 (C.D. Calif.). The proposed Yahoo settlement, which a judge preliminarily approved on June 28, includes cash rebates to advertisers who have allegedly suffered from click fraud since January 2004. Kabateck said that class members would get reimbursed 100 cents on the dollar, and the attorney fees were less than $5 million. But according to papers filed earlier this month in the Google case, plaintiffs’ lawyers are seeking contempt orders and sanctions against the attorneys for objectors who also drafted the Yahoo settlement. They say those attorneys secretly negotiated the California settlement while Yahoo, which is also a defendant in the Google case, was in mediation with the plaintiffs’ lawyers. Kabateck responded, “That is one of the most outrageous groups of lawyers I’ve ever encountered. The Google settlement was considered to be one of the worst class action settlements in the history of the U.S.” He defended the Yahoo settlement, saying “we prevented them from settling the Yahoo case.” A Yahoo spokeswoman and Yahoo’s lawyer, Larry McFarland, a partner at Beverly Hills, Calif.-based Keats McFarland & Wilson, did not return calls.

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