LendingTree Files Lawsuit Against Google
A lawsuit filed by LendingTree, which allows prospective borrowers to get quick offers from multiple lenders, will seek to stop Google from establishing a similar business, The Associated Press reported.
Sources say that Google plans to launch such a service later this month or in early September and LendingTree claims it has received screen shots showing a trial version of Google’s service that indicate Google will give customers loan offers and contact information for lenders.
Google said in a statement on Wednesday it is working on a small ad unit test involving a limited number of mortgage-related searches. The company acknowledged it has a number of experiments going on at any one time, but said the company does not speculate on future product development.
The Internet search leader has entered several ventures aside from its core business of selling ads alongside Internet search results. Its popular Google Maps app was altered in July to highlight its real estate search tools.
The company has also created an operating system for mobile devices, and Google Voice, which gives people an additional phone number that’s not tied to any specific phone line. Google also created PowerMeter, an app that allows it users to track energy use within their home.
Rob Enderle, an analyst for the Enderle Group, said Google’s move into the lending referral business would be one more step away from its core business.
“It could represent a solid threat to LendingTree, and a distraction for Google,” he said.
LendingTree, a unit of Tree.com Inc., announced the lawsuit on Wednesday, a day after it was filed in U.S. District Court in Charlotte, N.C., where the company is based.
LendingTree originally filed a lawsuit against Mortech Inc., which helps automate pricing by lenders who are offering loans. The lawsuit says Mortech works for lenders, not for LendingTree.
However, LendingTree argues that Mortech signed an agreement limiting its ability to make pricing searches available to other online loan aggregators. LendingTree claims Mortech has broken that agreement by giving data related to mortgage offers to Google in connection with Google’s testing.
LendingTree claims in the court papers: “In the course of its collaboration with Google, Mortech will inevitably disclose the confidential, proprietary, and secret information that it has about LendingTree.”
Neither Google nor Mortech have commented publicly on the lawsuit.
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