Microsoft Sues Family for Alleged Advertising Click Fraud

Microsoft has acted to stop what it says is an illegal family advertising scheme. The software giant filed suit in U.S. District Court for Western Washington against three Canadian family members, accusing the trio of massive click fraud.

Click fraud is committed when a person, computer program, or automated script imitates a Web surfer by clicking on an online ad to get a fraudulent “charge per click” without any interest in the ad’s link, according to Tim Cranston, Microsoft’s associate general counsel for Microsoft Internet Safety Enforcement.

“With this legal action we can aim to seek an injunction to help stop this particular activity, recover damages as well as send a message — both to perpetrators of fraud and to the online advertising community — that Microsoft does not tolerate click fraud and will take action to protect its network and advertisers,” Cranston said.

Microsoft alleges that Eric Chuen Lam, working with his brother, Gordon Lam, and mother Melanie Suen, as well as Super Continental US, committed click fraud on online ads related to both auto insurance and World of Warcraft, a multiplayer online role-playing game. Along with the injunction, Microsoft is seeking $750,000 in damages.

“Today’s action is one more step to expand that effort by utilizing the legal system to combat click fraud,” Cranton said. “Enforcement can play a critical safety role, supplementing technology and industry best practices, by using lawsuits and criminal prosecutions to stop the most egregious violators and hold them accountable for the fraud they commit.”

Microsoft said the family members benefited from the fraud in two ways:

By repeatedly clicking on a sponsored site through what the industry refers to as a click farm, where users continuously click on a competitor’s ad to deplete the competitor’s ad budget and lower the placement of the competitor’s sponsored…

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