Friend v. Google LLC

Background

Donald Friend, who represented himself, invested in Dumpsters Direct LLC and had an arrangement under which the company paid him for helping acquire new customers. Friend alleged that Google allowed competitors to use false information on Google Search and Maps business profiles. He claimed those listings diverted potential customers from Dumpsters Direct and reduced his compensation. Friend brought six claims related to the allegedly fraudulent listings.

Google's Motion

Google moved to dismiss under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). It argued, among other things, that Friend lacked standing, meaning he was not entitled to pursue these claims in federal court. Friend argued that his lost income was a direct injury rather than an injury belonging to Dumpsters Direct.

Court's Analysis

The court held that Friend lacked both prudential standing and constitutional standing.

First, the court applied the rule that a plaintiff generally must assert his own legal rights rather than rely on the rights of another party. Friend's alleged injury as an investor was not separately recognizable because an injury to a company is generally not an injury to its investors. The court also held that Friend's reduced compensation was a derivative injury under Delaware law: he would lose compensation only because Dumpsters Direct allegedly lost customers and revenue. Thus, his injury depended on a prior injury to Dumpsters Direct.

Second, the court held that Friend did not sufficiently allege that Google's conduct caused his injury. Friend alleged that false listings could improve competitors' prominence and could divert customers, but he did not identify a specific instance in which a potential customer chose a competitor because of a false listing instead of working with Dumpsters Direct. The court found that the alleged causal connection remained speculative.

Disposition

The court granted Google's motion to dismiss without leave to amend. It concluded that amendment would be futile because any claim based on Friend's compensation would necessarily allege that his loss resulted from harm to Dumpsters Direct, making the injury derivative. Because the court resolved the motion based on standing, it did not address Google's remaining arguments.