U.S. tech giant Alphabet’s (GOOGL) shares edged lower on Wednesday after Google agreed to pay $135 million to settle a class action lawsuit over alleged unauthorized cellular data collection on Android mobile devices.
Claim 50% Off TipRanks Premium
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Stay ahead of the market with the latest news and analysis and maximize your portfolio's potential
The case dates back to November 2020, when users dragged Google to court over allegations of “conversion,” that is, secretly harvesting cellular data without permission since 2017, while devices were idle. However, a court document filed on Tuesday at the U.S. District Court in San Jose, California, shows both sides have agreed to a preliminary settlement.
Google Agrees to Let Users Disable Data Transfers
The settlement still requires court approval and could be presented before Judge Virginia K. DeMarchi as soon as February 17. However, Google, with the proposed settlement, does not admit any wrongdoing.
As part of the settlement, the American tech giant is required to notify Android mobile device users of the allegations behind the case and obtain “express consent” to track their cellular data. The company is also expected to make changes to the terms of its Google Play Store service, and make it possible for users to stop the transfer of such data.
The settlement marks the latest such compromise in cases accusing the tech giant of unauthorized data collection. It comes several months after a jury in California in a separate case hit Google with a $314.6 million settlement verdict to Android smartphone users over similar allegations.
Similarly, Google last year was ordered to pay $1.4 billion to settle claims made by Texas against the company in 2022. For instance, Texas alleged that Google illegally collected geolocation, incognito search, and biometric data of users in the state.
Is Alphabet a Good Stock to Buy?
On Wall Street, analysts continue to hold a Strong Buy consensus rating on Alphabet’s shares based on 26 Buys and seven Holds issued over the past three months.
At $347.70, the average GOOGL price target implies about 4% upside potential.
