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LinkedIn is facing a class-action lawsuit for overcharging advertisers for video ads. The basis of the case is that the professional networking platform, through developer errors, inflated the number of impressions and/or views that advertisements on their site were actually getting. Charging small businesses for ad space is one of LinkedIn’s largest revenue streams and, in total, more than 418,000 customers were affected by this inaccurate data.
LinkedIn themselves broke this story with the release of a post on their marketing blog. In it, LinkedIn says that their developers had discovered an error in the way that impressions and views were calculated for advertisements on their platform. They also state that 90% of the affected advertisers lost no more than $25 due to the error. Doing the math on that one, the up-front monetary loss across all affected advertisers is likely to be anywhere between $375,000 and upwards of $9 million.
Allow us to dive deeper into the actual issue at hand. Aside from your run-of-the-mill bot users, the programming issue found by LinkedIn’s developers apparently counted video views and ad impressions for offscreen advertisements that had already been scrolled past by users. This allowed ad views to rack up without anyone actually viewing anything.
After that blog post was released, a complaint was filed by Topdevz, LLC and Noirefy, Inc individually and on behalf of the class. The complaint alleges that the aforementioned LinkedIn ad metrics “are systematically distorted to benefit LinkedIn” and that these distortions “have increased the price of LinkedIn advertising for years” (In Re Linkedin Advertising Metrics Litigation, 2020).
This lawsuit was originally filed on the basis of fraud, but that was shot down in early August by U.S. Magistrate Judge Susan van Keulen. However, the case was allowed to continue on the grounds that, “based on the theory that bot traffic, errant clicks, and fraudulent clicks inflated the metrics they relied on when buying LinkedIn ads” (Stempel, 2021).
The plaintiffs are seeking unspecified damages and restitution. LinkedIn released a statement saying they were looking forward to proving that they had not broken the law. Shortly after, Warren Postman, one of the plaintiff’s lawyers, released his own statement saying that he was looking forward to proving that LinkedIn had, in fact, broken that law.
With both sides still ramped up and ready to go, you’re going to want to stay updated on this case. Make sure to check in at our blog (https://certificateclearing.com/index.php/blogs/) and follow Certificate Clearing Corporation on Twitter and LinkedIn for continued coverage of this case and many more.