LinkedIn to face lawsuit for overcharging advertisers

LinkedIn

A U.S. judge dismissed much but not all of a lawsuit accusing Microsoft Corp’s LinkedIn of inflating the number of people who watch video ads on the networking platform, allowing it to overcharge hundreds of thousands of advertisers.

U.S. Magistrate Judge Susan van Keulen on Tuesday rejected fraud-based claims and an unfair competition claim, saying the plaintiff advertisers did not show that LinkedIn made specific misrepresentations or that its conduct hurt the public at large.

But the San Jose, California-based judge also let the advertisers pursue claims based on the theory that bot traffic, errant clicks and fraudulent clicks inflated the metrics they relied on when buying LinkedIn ads.

The advertisers said LinkedIn was counting video ad “views” from users’ LinkedIn apps, even when the videos were playing only off-screen because users had scrolled past them.

The advertisers sued after LinkedIn said on Nov. 12 that its engineers had three months earlier found and then fixed software bugs that may have led to more than 418,000 overcharges.

LinkedIn said more than 90% of the overcharges were less than $25, and that it provided credits to virtually all affected advertisers.

In their lawsuit, the advertisers said the overcharges left them with less money to spend elsewhere, including on ads. They are seeking unspecified damages and restitution.

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