San Francisco - Uber is accustomed to getting sued. Now it’s doing the suing. And it’s partly thanks to Breitbart News.
The global ride-hailing company is taking advertising agency
Fetch Media to court for click fraud, alleging that the firm
improperly billed Uber for “fake” online ads and took credit for app
downloads it had nothing to do with. Fetch is owned by the world’s
fourth-largest advertising company, Japan’s
Uber filed the lawsuit on Monday afternoon in US District Court in San
Francisco. The company said it discovered something was amiss when it
cancelled a campaign on the conservative website Breitbart, where Fetch
was placing Uber ads.
As part of the lawsuit, Uber plans to seek at
least $40m in damages, according to people familiar with the
matter, who asked not to be identified disclosing legal plans. Fetch
didn’t immediately respond to requests for comment.
Going on the offensive in court is a rare move for Uber. The company
is a plaintiff in only two federal cases, according to data compiled by
Bloomberg. Meanwhile, it has been a named defendant in about 250 federal
cases. The data aren’t comprehensive but show Uber is usually on the
Online advertising fraud has been a problem for the industry since
the dawn of the internet. The practice has grown more sophisticated in
recent years along with the amount spent on such ads. Fetch has
acknowledged the challenge publicly and said it was working with
research firm Forensiq to “fight against mobile ad fraud.”
“One of the biggest challenges we face as digital marketers is to
reduce mobile ad fraud,” James Connelly, Fetch’s chief executive
officer, said a year ago.
Around the same time, Fetch’s global head of media, Steve Hobbs, told
Adweek that a “significant amount” of downloads in Fetch’s system are
flagged as suspicious. “Where there’s money, there is fraud,” he told
the publication. “Being 100% on top of it is an impossibility,
but we think with Forensiq’s help we can get it significantly lower.”
Uber learned of the alleged fraud when it was trying to avoid scandal
of a different kind. The company had asked Fetch not to post
advertisements on Breitbart News, a site run by President Trump’s former
Steve Bannon. But it saw ads appearing there anyway.
Fetch pulled ads from all networks that had a relationship with
Breitbart, but the move had little effect on the number of people
downloading the app, contrary to Fetch’s claims, the complaint said.
Uber pays Fetch and other ad networks a fee when a potential customer
downloads its app after seeing an ad.
Uber alleged that after further
inspection, Fetch had a widespread practice of over-billing. Uber claims
that Fetch had been attempting to claim credit for app downloads it
“With Fetch, we learned the age-old lesson ‘buyer beware’ the hard
way,” the company said in an emailed statement. “Fetch was running a
wild west of online advertising fraud.”
From 2015 to early 2017, Uber paid more than $82.5m for
advertisements overseen by Fetch, according to the complaint. Uber has
refused to pay more than $7m that Fetch has said it owes. Fetch’s
publicly traded parent company Dentsu, which has a $12bn market capitalisation, is not named in the lawsuit.
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