Technology company Google settled with the state of Arizona to pay $85 million in a lawsuit that accused the company of violating the Arizona Consumer Fraud Act by using “deceptive or unfair act” in tracking users’ location data. Arizona is the most recent state to settle with the company, but Google faces suits from at least four other states with the same allegation.
In 2018, the Associated Press published an article that stated Google was misleading its users on how they were tracking their location data. The Associated Press found, and confirmed with computer science researchers at Princeton, that “many Google services on Android devices and iPhones store your location data even if you’ve used a privacy setting that says it prevents Google from doing so.”
Soon after this article was released, Arizona Attorney General Mark Brnovich began an investigation into the company on behalf of Arizona. Brnovich filed a lawsuit in May 2020 accusing the company of using “deceptive practices and coercive design tactics” to track users’ location data. He further claimed that the company was doing this to significantly increase its ad revenue by violating a user’s privacy.
The Arizona Consumer Fraud Act, ARS 44-1522, states that it is illegal to use a “deceptive or unfair act or practice… in connection with the sale or advertisement of any merchandise whether or not any person has in fact been misled, deceived or damaged.”
Alphabet, the parent company of Google, LLC, reported that in 2020, the year Brnovich filed the lawsuit, their total revenue was almost $183 billion with over 80%, or $147 billion, coming straight from Google’s ads business, making it their main source of income. Location data allows Google to target ads to consumers, helping their revenue increase exponentially over time.
A spokesman for Google, Jose Castaneda, told USA Today that “this case is based on outdated product policies that we changed years ago” and that the company “provide(s) straightforward controls and auto delete options for location data and are always working to minimize the data collect.”
To date, this lawsuit was one of the biggest consumer fraud lawsuits in the history of the state and is the largest amount per capita that Google has paid in a lawsuit regarding privacy and consumer fraud. But this is not the only consumer fraud lawsuit Google is currently facing.
As of January of this year, four other Attorneys General are suing Google for misleading users about tracking their location data. Washington, DC, Indiana, Texas, and Washington, a bipartisan group, all filed separate lawsuits for Google’s actions from 2104-2019. The Attorney General for D.C., Karl Racine, differentiates these lawsuits from the one filed by Arizona by focusing on “dark patterns,” or design choices made by the computer engineers to subtly move users toward the decisions the company or designers want.
The lawsuit stipulates that $77,250,000 will be transferred directly from Google to the state fund, and the other $7,750,000 to the State’s counsel. Five million dollars will be used for the Attorney General’s education programs such as funding for an accredited law school “that maintains programs for the education of attorney general staff and judges regarding consumer protection issues.” The remaining money will be put “toward education, broadband, and Internet privacy efforts and purposes” to be available after the State appropriates accordingly.
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