Google is facing a class action complaint accusing it of illegally intercepting personal income tax returns filed online through companies that use its web tracking technology.
Named plaintiff Mary Smith, through the Walnut Creek office of Bursor & Fisher, filed a complaint July 14 in federal court in the Northern District of California. Other law firms involved include George Feldman McDonald, of Croton-on-Hudson, New York; Lockridge Grindal Nauen, of Minneapolis; and Hoda Law Firm and Foster Yarborough, both of Houston.
The complaint identifies online tax filers like H&R Block, TaxAct and TaxSlayer, all of which Smith said use an embedded “tracking pixel” from Google Analytics, which she alleged constitutes illegal wiretapping and disclosure of tax return information without consent. Smith, a resident of DuPage County, Illinois, wants the court to certify a nationwide class and an Illinois subclass for people who filed taxes online as far back as 2018.
“The significance of the information gathered for targeted advertising cannot be understated and Google understands this well,” Smith alleged. “In 2020, Google generated $104 billion through advertising (71% of Google’s entire revenue for that year). Google’s revenue from advertising is expected to reach $201.05 billion by 2024.”
The pixel tool, a default feature that uses JavaScript, gives detailed information about how people use websites, according to Smith, including where they click, scroll and search. She said the most recent Google Analytics release includes the Reporting Identity feature, through which Google’s customers can identify website users from the collected data. Further, she said, “Google Analytics offers advertisers machine learning technology to surface and predict new user insights such as their behavior and creates new audiences of users likely to make a purchase.”
Smith said Google not only markets the pixel to customers but benefits from its use because the resulting information can “power its algorithms, providing it insight into the habits of users across the internet. Indeed, the data obtained allows Google to amass huge amounts of data in a detailed dossier, or digital fingerprint, that it keeps on its users and other website visitors. To the benefit of Google, Google Analytics also includes the feature to integrate with other Google data collecting products such as Google Ads, Google Data Studio, Google AdSense, Google Optimize 360, Google Ad Manager and Google Search Console.”
According to the complaint, Smith used H&R Block to file her taxes online as far back as 2018. But she cited a recent U.S. Senate investigation in which “TaxAct revealed that dollar amount of adjusted gross income and refund amounts were disclosed to Google.” She further alleged TaxSlayer, which processed 10 million state and federal returns in 2022, has used a Google pixel since March 2011.
“Google would have known, or at best recklessly turned a blind eye, to the fact that it was collecting vast amounts of confidential tax information,” Smith said, alleging the Google Analytics customers could’ve tracked sensitive information. “Evidence obtained as part of the recent Senate investigation appears to indicate that Google ‘failed to implement adequate safeguards to prevent the transfer of taxpayers’ sensitive personal and financial information, despite their contentions that they did so.’ ”
The complaint said Google didn’t get consent to receive private tax data, while also falsely representing it didn’t collect sensitive information. Formal allegations include violations of the California Invasion of Privacy Act and Federal Wiretap Act along with common and state law invasion of privacy protections and intrusion upon seclusion.
In addition to class certification and a jury trial, Smith seeks statutory damages, with interest, and injunctions and legal fees.