Mobile advertising startup Unlockd won a temporary injunction from the Federal Court Thursday barring Google from blocking its app in Australia until further hearing, in the first case to test revamped misuse of market power laws.
During an emergency hearing in Melbourne Thursday morning, Justice Mark Moshinsky said he would make the interim order against Google Asia Pacific, to stay in effect until an interlocutory injunction hearing scheduled for the week of June 25.
The interim injunction covers the Australian company’s Unlock Rewards app, which allows the eight million members of Wesfarmers’ Flybuys scheme to earn points for viewing ads.
Unlockd filed a competition and consumer case against Google in the court on Wednesday, after Google notified the Lachlan Murdoch-basked company that it was planning to block Unlockd’s app from its Play Store and AdMOb advertising marketplace in Australia.
The case alleges misleading and deceptive conduct under the Australian Consumer Law and accuses Google of misusing its market power in violation of section 46 of the Competition and Consumer Act. It is believed to be the first case to test the new effects test under the Act, which took effect in November.
Unlockd’s barrister Michael O’Bryan, QC, told Judge Moshinsky on Thursday that the company was seeking the interim relief against Google Asia Pacific, as well as ex-parte interim relief against US parent company Google LLC. Unlockd is also seeking court approval to serve Google LLC, which is named as the second respondent in the case, under the Hague Convention.
Google’s barrister, Michael Borksy, QC, told the court the search engine giant had agreed in discussions with Unlockd to be bound by an interim injunction covering just the Rewards app and enjoining only Google Asia Pacific. He urged Judge Moshinsky to issue that more narrow order.
“One would strive to order the minimum necessary to maintain the status quo,” Borksy said.
The Australian lawsuit comes after Unlockd won an injunction in the UK High Court blocking Google from removing Unlockd’s UK app from Play Store and AdMob. The company filed the case against Google in the UK after the company there threatened to remove it from its Play Store and AdMob marketplace. Unlockd was forced to pull its planned initial public offering in response. A trial in the UK is scheduled to start on September 24.
Google says Unlockd’s apps violate its terms and conditions. The court heard Thursday that Google’s chief complaint is that the apps do not have sufficient content apart from advertising as required under its policies.
The Unlockd apps provide targeted advertising to users when their phones are unlocked in exchange for points that can be redeemed on things like mobile credit and data, entertainment or loyalty points.
Unlockd argues Google is abusing its market power and using anti-competitive tactics to shut down a potential competitor that could threaten its advertising revenue.
“There is a course of conduct we say is problematic,” O’Bryan said. “Google’s actions threaten its survival.”
Both parties are seeking an expedited trial in the case, the court was told, but Google wants the case to be heard before the UK trial and Unlockd says the UK trial should take precedence.
Unlockd is represented by Minter Ellison.
Google is represented by Ashurst.
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