SAN JOSE (CN) - A federal judge Thursday dismissed without prejudice a class action accusing Google of denying payment to website owners who participate in its AdSense revenue-sharing program.
U.S. District Judge Beth Freeman dismissed claims that included breach of contract, bad faith, unjust enrichment and unfair competition.
Free Range Content filed the class action in May 2014, claiming Google runs its AdSense program in a way that pays website owners nothing.
But Judge Freeman said Free Range will have to "plead additional facts demonstrating defendant's alleged bad faith beyond that of simply exercising a contractual right to terminate accounts and withhold payment."
Free Range also must demonstrate that it did not waive its right to payment by not disputing Google's payment withholding, as required by the AdSense terms of service, the judge wrote.
Free Range, of San Francisco, claimed that Google intentionally closes AdSense accounts to deny full payment to website owners. Account terminations can cost website owners and publishers anywhere from a couple hundred dollars to tens of thousands of dollars each year in lost revenue, according to the complaint.
In its motion to dismiss, Google said it had every right to close Free Range's AdSense account and that the company's complaint would "turn contract law on its head."
"After enjoying the benefits of participating in the AdSense program for a year-and-a-half, plaintiff, by its own admission, breached several explicit terms of that contract," Google said in its motion to dismiss.
"Google then did exactly what it said it would do in the contract - it closed plaintiff's AdSense account, did not make a payment to plaintiff that, pursuant to numerous contract provisions, plaintiff had no right to receive, and refunded the withheld payment (along with Google's revenue share) to advertisers."
Google AdSense pays website owners and publishers a percentage of revenue from ads that appear while people browse their sites. When visitors view the ads or click on them, Google is supposed to pay the website owners a portion of revenue from those ads.
Freeman gave Free Range until March 5 to file an amended complaint.
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