A recent federal court ruling found that Google isn’t required to refund users who fall victim to scams involving Google Play gift cards (h/t: Ars Technica).
The case, brought by Judy May, highlights a common scam where people are tricked into buying gift cards under false pretenses. In 2021, May lost $1,000 in a fake government grant scam after being told to pay “processing fees” with Google Play gift cards. When she asked for a refund, Google declined, citing its policy against refunding gift card transactions.
According to the Federal Trade Commission, from 2018 to 2021, 20% of all reported gift card scams involved Google Play, with losses over $17 million. May argued that Google should do more to warn customers, such as by adding clearer card warnings.
Judge Beth Freeman mostly sided with Google, dismissing May’s claims. She noted that the harm came from third-party scammers, not any misleading actions by Google, stating, “May suffered economic harm because of third-party scammers’ fraudulent inducement, not Google’s omission or misrepresentation.”
May also argued that Google indirectly profits from these scams, taking a 15-30% commission on Play Store purchases made through gift cards. However, the judge dismissed this argument, saying May’s losses were due to misuse of the gift cards, not any actions by Google.
The judge also denied May’s request for triple damages, explaining that her awareness of the scam lessened her chances of being tricked again. However, Freeman gave May 45 days to revise certain parts of her complaint.
Google’s policy on gift card refunds is similar to that of major retailers like Walmart and Target, which also don’t offer refunds for scammed gift cards. This industry standard likely supported the judge’s decision, suggesting that Google’s policy aligns with others.
This ruling raises questions about Google’s responsibility to protect its users, especially as these scams are well-known. Although scammers are the main problem, Google’s limited response raises ethical concerns. The case also shows the limits of consumer protections with gift card scams, reminding people to stay cautious. If something seems too good to be true, it probably is.
