October 29, 2014 / 4:38 PM / 3 years ago

U.S. judge says Google settlement over pharma ads is fair

People are silhouetted as they pose with laptops in front of a screen projected with a Google logo, in this picture illustration taken in Zenica October 29, 2014. REUTERS/Dado Ruvic

OAKLAND Calif. (Reuters) - A U.S. judge said Google’s plan to create a $250 million internal program to disrupt rogue online pharmacies is a fair way to end shareholder litigation over accusations the search company improperly allowed ads from non-U.S. drug sellers.

Under the terms of the deal, Google also said it would make content about prescription drug abuse more visible and work with legitimate pharmacies to counter marketing by rogue sellers.

The settlement must be approved by a U.S. court. At a hearing on Wednesday in Oakland, Calif. federal court, U.S. District Judge Phyllis Hamilton said the programs Google would create are “satisfactory.”

Hamilton did not formally rule from the bench, but said she was prepared to preliminarily approve the settlement.

Shareholders sued Google and its board in 2011 after the company reached a settlement with the government over the issue.

Google will allocate and spend at least $50 million a year to the internal effort for at least five years under the settlement. The company has also agreed to pay $9.9 million in fees and expenses to plaintiff attorneys.

The case in U.S. District Court, Northern District of California is In re Google Inc Shareholder Derivative Litigation, 11-4248.

Reporting by Dan Levine; Editing by Alan Crosby

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