August 23, 2012

Consumer Watchdog Group Fights FTC Settlement With Google

Enid Burns for - Your Universe Online

Google reached a settlement agreement with the FTC to pay $22.5 million based on charges the search giant misrepresented privacy assurances to Safari users. A consumer watchdog group wants to block the agreement. The group alleges that if Google pays the settlement fees, it absolves itself of any wrongdoing.

"The Commission is proposing to let Google buy its way out of trouble for an amount that is less than the company spends on lunches for its employees and with no admission it did anything wrong," said John M. Simpson, Consumer Watchdog's Privacy Project director. "Corporations need to be held accountable when they willfully violate a consent agreement."

Attorneys Gary Reback and Robert J. Yorio, of the law firm Carr & Farrell filed the motion in U.S. District Court in San Francisco. Attorneys filed the motion on behalf of the nonprofit, nonpartisan public interest group. The motion asks Judge Susan Illsten to grant Consumer Watchdog friend-of-the-court status, and allow the group to submit briefs opposing the settlement. The group also asks for a hearing on the proposed deal, and that Consumer Watchdog will be allowed to appear at the hearing.

Consumer Watchdog believes the settlement concerning the "Buzz Consent Agreement" is inadequate. The group alleges that it allows Google to deny that it violated an earlier privacy consent agreement. "The motion notes that Commissioner J. Thomas Rosch dissented from the agreement because the proposed settlement allows Google to deny any violation of its 'Buzz Consent Agreement.' He further argued that the proposed $22.5 million civil penalty does not justify the denial of liability because it is such a small amount of Google's profit or revenues," a statement from the Consumer Watchdog group reads.

The group filed a brief, which stated, "The question of whether federal courts should accept consent settlements between government agencies and private companies in which the companies continue to deny liability is currently an issue in two other prominent pieces of litigation." The brief cites two cases between the SEC and Citigroup Global Markets.

The FTC may have its eye on bigger issues. Former FTC Chairman William Kovacic spoke on a panel at the Technology Policy Institute this week advising against the FTC pursuing an unfair competition lawsuit against Google, saying it would be "an uphill battle for his former agency," CNET reports. Kovacic is currently a law professor at George Washington University. He believes the FTC may be embarking on just such an endeavor, against Google and possibly other companies.

"If I were Mount Google or Mount Apple, I'd be really worried about being scaled today," Kovacic was quoted by CNET saying during a panel discussion on antitrust at a Tech Policy Institute conference.

The FTC may be going after more than just Google. A Computerworld article , "7 reasons the FTC could audit your privacy program," outlines the reasons the FTC is targeting search giant Google and other internet companies for their privacy policies.

Google isn't sitting back on this one. ZDNet reports Google is building a privacy "red team" of experts to monitor and possibly clean up any privacy bugs and risks in Google products.