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California Court Gives Green Light to Suit Against Yahoo, Google, Others for Alleged Illegal Involvement in Internet Gambling Ads

June 3, 2005

Defendants, including Yahoo, Google, FindWhat and other major search engine websites lost their motion to strike core allegations in plaintiffs’ complaint in the case of Cisneros et al v. Yahoo et al (San Francisco County Superior Court). These allegations ask the Court to provide a remedy against the search engine’s alleged illegal advertisement of Internet gambling. The Court made a ruling that allows the case to move forward.

Plaintiffs’ complaint, filed last August in California Superior Court in San Francisco, alleges that Yahoo, Google, Overture, Ask Jeeves, LookSmart, AltaVista, Terra Lycos, Jupiter, FindWhat, Kanoodle, Business.com, and Sex.Com all aided and abetted illegal gambling websites and violated California law by providing paid advertisements in violation of California Penal Code provisions and the Unlawful Business Practices Act. Californians, including minors, the elderly, and the poor, according to the complaint have lost millions of dollars to unscrupulous internet gambling websites.

“The search engines, such as Yahoo and Google, attempted to convince the court that they could advertise Internet gambling with immunity – the court rejected that notion and allowed the case to proceed” said Reed Kathrein, an attorney for the plaintiffs.

“We are pleased that the Court denied the search engine defendants’ motions to dismiss and strike allegations and we are optimistic that the Court will find that the defendants were involved in an unlawful business activity when they actively advertised for a fee illegal internet gambling and that the Court will enjoin such activity” said Ira Rothken, an attorney for plaintiffs.

Plaintiffs allege that the defendants made enormous revenues actively supporting Internet gambling. For example, it was alleged that defendant Yahoo (through its Overture subsidiary) recently made as much as $12.97 (or more) per “click-through” for directing its users to illegal internet gambling websites. “The Court’s ruling now clears the way for plaintiffs to investigate defendants’ net gambling activities in the discovery process and learn the magnitude of their alleged wrongdoing” said Stan Mallison an attorney for the plaintiffs. Plaintiffs are requesting in the complaint injunctive relief, a declaration from the court that such behavior is illegal, and the restoration to the general public of defendants’ ill-gotten gains.

View the complaint.

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