Google Ads Lawsuit Hits Small Business Over Ad Costs
The digital advertising landscape that once promised small businesses affordable access to potential customers has become increasingly treacherous terrain. For suburban Chicago business owner Tim Chesney, what began as a standard Google Ads campaign to promote his construction business evolved into a financial nightmare, culminating in a lawsuit that highlights growing tensions between small enterprises and tech giants.
Chesney, who runs a modest construction firm in Naperville, claims Google’s advertising platform charged him over $40,000 for clicks that generated zero actual business. “I kept seeing the charges pile up, but the phone never rang,” Chesney told me during our interview at his workshop last week. “It was like throwing money into a digital black hole.”
The lawsuit, filed in Cook County Circuit Court, alleges Google’s advertising platform misrepresented the effectiveness of its targeting capabilities while obscuring the true costs associated with the ad campaigns. Chesney’s attorney argues that Google failed to provide adequate transparency regarding how ads were being served and to whom.
This case emerges amid growing scrutiny of Google’s digital advertising practices. The Department of Justice and several state attorneys general have pursued antitrust actions against the company, arguing it has created a monopolistic ecosystem that harms both advertisers and publishers. A recent Federal Trade Commission report indicated small businesses face disproportionate challenges when navigating complex digital advertising platforms.
“What we’re seeing is asymmetric information in the marketplace,” explains Dr. Eleanor Phillips, digital economics professor at Northwestern University. “Small businesses lack the technical expertise to fully understand or optimize these platforms, creating vulnerability to excessive charges with limited recourse.”
Google, which generated approximately $224.5 billion from advertising in 2022 according to their financial reports, maintains that their platform provides clear cost controls and performance metrics. In response to this case, a Google spokesperson stated: “We provide advertisers with transparent tools to manage their campaigns and budgets, including daily spending limits and performance reporting.”
However, for business owners like Chesney, these tools proved insufficient. His case details how despite setting a daily budget of $100, his account frequently exceeded this limit, sometimes by hundreds of dollars per day. The lawsuit further alleges the platform’s default settings steered him toward higher-cost bidding strategies without adequately explaining the financial implications.
The economic impact of potentially misleading digital advertising practices extends beyond individual cases. A recent Chamber of Commerce survey found that 68% of small business owners report difficulty controlling their digital advertising costs, with 42% saying they’ve experienced unexpected charges.
Digital marketing consultant Serena Washington, who specializes in helping small businesses navigate advertising platforms, describes a troubling pattern: “Many of my clients come to me after being burned by automated campaigns. The platforms are designed for sophisticated users with deep pockets, not mom-and-pop operations with limited budgets.”
For Chesney, whose construction business operates on tight margins, the advertising expenses represented nearly a quarter of his annual revenue. “I’m not against paying for advertising that works,” he explained, pointing to a weathered ledger showing his business accounts. “But I expected some return on that investment. Instead, it nearly bankrupted me.”
The case has attracted attention from small business advocacy groups, including the Illinois Small Business Alliance, which has filed an amicus brief supporting Chesney’s position. Their statement notes that “transparent and fair digital advertising is essential to the survival of local businesses in an increasingly online marketplace.”
Legal experts suggest this case could have broader implications. “While individual lawsuits rarely reshape tech giants’ practices, the accumulation of similar cases can create pressure for systemic change,” notes consumer protection attorney Marcus Reynolds. “This fits into a larger pattern of scrutiny regarding how digital advertising platforms operate.”
Google’s dominance in the digital advertising space—controlling approximately 28.8% of all digital ad spending according to eMarketer—gives it enormous leverage over businesses seeking online visibility. The lawsuit argues this power imbalance creates conditions where small businesses have little choice but to participate in Google’s ecosystem under terms that heavily favor the platform.
The Federal Reserve Bank of Chicago recently published research indicating that small businesses spend between 10-20% of their marketing budgets on digital advertising, with many reporting difficulties measuring return on investment. This research suggests Chesney’s experience, while perhaps extreme, reflects widespread challenges.
As this case progresses through the court system, it serves as a reminder of the complex relationship between technology platforms and the small businesses that rely on them. For entrepreneurs like Chesney, the promise of digital advertising—targeted reach at reasonable costs—remains unfulfilled.
“I just want fair treatment,” Chesney said as we concluded our conversation. “If they’re going to take my money, I should get something real in return.”
The outcome of this case could signal whether courts are willing to intervene in the digital advertising marketplace or if small businesses must continue navigating these waters largely on their own.
