The UK-based Dentsu Aegis-owned mobile advertising agency Fetch Media is suing Uber Technologies Inc a reported $19.7 million that the ride-hailing company has refused to pay over claims that ads were fraudulent.
The lawsuit was filed on Tuesday, January 2, in the same California federal court where the ongoing legal row began in September.
Uber initially sought $40 million in damages from Fetch after it accused the agency of billing it for fake clicks on its online ads, with the company accusing the agency “running a wild west of advertising fraud”.
However, Uber voluntarily dismissed the original lawsuit in December, planning to pursue related claims in San Francisco, after the case was reassigned to U.S. District Yvonne Gonzalez Rogers, who has overseen other lawsuits involving Uber.
This led to speculation by Fetch that Uber didn’t have faith that its case would hold up, leading the agency to call for Judge Rogers to determine both companies’ contractual responsibilities and to direct Uber to pay the outstanding invoices that Fetch claims it is owed.
“Fetch does not believe that Uber can avoid federal-court scrutiny of its incorrect contract theories so easily,” Fetch’s counter-suit reads; “Fetch respectfully requests that the Court interpret the parties’ contract and issue a declaration regarding Fetch’s and Uber’s responsibilities under the parties’ contractual relationship.”
Fraudulent traffic
Uber initially hired Fetch to place ads to boost downloads of the Uber app but claimed Fetch has wrongly claimed credit for downloads that occurred without ads ever being clicked. Of the $82.5 million it said it had paid the agency, Uber said that Fetch’s failure to stop ad fraud contributed to at least $50 million in damages.
When that deal was made, Fetch claims both parties were aware of a click fraud problem and had agreed to work together to handle the issue, including suggesting tools that Uber could use to combat ad fraud and avoiding certain suppliers. However, it now claims the advertiser was “inconsistent” in following the advice.
In early 2017, Fetch claims Uber “suddenly changed its tune”, with a new team taking charge of the relationship and claiming it has “no prior knowledge” of the ad fraud, adding that Fetch had a duty to prevent all ad fraud with respect to dozens of suppliers.
According to Uber, the company was made aware of alleged fraud when customers began reporting the company’s ads appearing on right-wing news publisher Breitbart, despite Uber specifically indicating the site as one of those it considered “offensive or inappropriate”.
In its court hearing, Fetch dismissed the claims as accusations of a “faithless business partner”, adding that it had helped Uber to monitor ad fraud beyond its contractual obligations.
According to ad verification company Adloox, ad fraud as a result of impressions and clicks by non-human traffic was estimated to have cost businesses $16.4 billion in 2017.
