LinkedIn has agreed to pay $6.625 million to settle a proposed class action lawsuit accusing the Microsoft subsidiary of cheating advertisers by inflating the number of viewers of video ads on its platform.
A preliminary settlement was filed late Thursday in federal court in San Jose, California, and is subject to approval by U.S. Magistrate Judge Susan van Keulen in San Jose, California.
LinkedIn denied any wrongdoing. The company also agreed to use reasonable efforts for two years to engage a third-party auditor to review its ad metrics.
Advertisers such as Sacramento, Calif.-based TopDevz and Chicago-based Noirefy accused LinkedIn of inflating ad metrics by counting “views” of video ads from users’ LinkedIn apps, even when the videos were only playing off-screen because users scrolled past them.
The litigation began two weeks after LinkedIn announced in November 2020 that its engineers had fixed software bugs on the business-focused social media platform that may have led to more than 418,000 overpayments, most of them under $25.
LinkedIn has issued credits to almost all affected advertisers.
Thursday’s settlement affects U.S. advertisers who purchased ads on LinkedIn between January 2015 and May 2023.
Neither LinkedIn nor Microsoft immediately responded to requests for comment on Friday.
LinkedIn is based in Sunnyvale, California, and Microsoft is based in Redmond, Washington. Microsoft’s profit was $66.1 billion for the nine months ended March 31.
Judge van Keulen dismissed the lawsuit in December 2021. The advertisers appealed but stayed the appeal so that both sides could settle the dispute.
Advertisers’ attorneys may seek up to $1,656,250, or 25 percent of the settlement amount, for attorneys’ fees.
The case is In re LinkedIn Advertising Metrics Litigation, U.S. District Court for the Northern District of California, No. 20-08324.
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