Arizona Alleges Consumer Fraud In Lawsuit Against Google

Google owner Alphabet Inc. GOOGL GOOG is being sued by the state of Arizona, which is alleging the use of “deceptive” and “unfair” practices.

What Happened

Arizona’s Attorney General Mark Brnovich took to Twitter to announce the filing of the lawsuit on Wednesday, saying, “Today we filed a consumer fraud lawsuit against Google for deceptive and unfair practices used to obtain users’ location data, which Google then exploits for its lucrative advertising business.”

Brnovich said the state’s action was spurred by a 2018 Associated press article that spelled out how users are “lulled into a false sense of security, believing Google provides users the ability to actually disable their Location History.”

In a statement provided to Reuters, a Google spokesman offered a rebuttal saying, “The Attorney General and the contingency fee lawyers filing this lawsuit appear to have mischaracterized our services. We have always built privacy features into our products and provided robust controls for location data.”

Why It Matters

The lawsuit demands unspecified damages and alleges that Alphabet’s Android operating system deceives smartphone owners regarding protections available to their personal data, reported Reuters.

In February, New Mexico sued Google accusing the tech giant of violating Children’s data privacy. 

Arizona’s attorney general noted that last year over 80% of Google’s revenues, $135 billion out of $161 billion,  were derived from advertising. He tweeted, “Google collects detailed information about its users, including their physical locations, to target users for advertising. Often, this is done without the users’ consent or knowledge.”

Price Action

On Wednesday, Alphabet class A shares traded mostly unchanged at $1,420.28. The company’s class C shares traded 0.13% lower at $1,416 in the after-hours session. The shares had closed the regular session, mostly unchanged at $1,417.84.