Gambling lawsuit filed against top Web content sites

A handful of leading online content providers, including Yahoo Inc. and Google Inc., are being sued for accepting advertisements for illegal Internet gambling, a class-action lawsuit filed yesterday states. The lawsuit alleges that the companies are accepting money to promote illegal Internet gambling sites on their search engines through paid or sponsored entries. The lawsuit, filed in the Superior Court of California, names as defendants Yahoo, Google, Overture Services Inc., Ask Jeeves Inc., Looksmart Ltd., CNet Networks Inc., AltaVista Inc., Terra Lycos Inc., Jupitermedia Corp., FindWhat.com, Kanoodle.com Inc., Business.com Inc. and Sex.com Inc. "We can't comment on this pending litigation," a Yahoo spokeswoman said. "Yahoo nor Overture, nor Altavista, nor any other Yahoo network [property] accepts paid listings for online gambling, " she said. Overture and AltaVista are separate units of Yahoo. Internet gambling companies are prepared to pay highly to get sales leads from these search engines, the lawsuit alleged. "Under the search term 'Internet gambling,' the highest price per lead was an astounding $12.97 per click through. ... The next four highest price click throughs (also gambling sites) were all at or above $12 per click through," the lawsuit noted. "The defendants conspired with the Internet gambling Web sites to create and provide Internet advertisements to areas such as California in which Internet gambling is illegal with the knowledge and intention of persuading and directing California residents to visit these illegal gambling Web sites so as to illegally gamble in California," the lawsuit states. The lawsuit alleges that Internet gambling sites avoid a 15% tax on gambling revenues that would otherwise go to the state coffers and that Internet gambling deprives California's indigenous Indian tribes of revenue from gambling that was guaranteed to them under a deal signed on June 21 with Gov. Arnold Schwarzenegger. Ratifying that deal, Schwarzenegger said, "The new agreement respects the tribes' sovereignty. It protects their exclusive gaming rights and it begins a new financial partnership between the tribes, local communities and the great state of California." The lawsuit asked for a permanent injunction against the alleged wrongdoing and for "restitution for all illegal gambling proceeds" received by the defendants and/or the Internet gambling operations, including state taxes and fees.