Google on Trial: Privacy, Italian Style

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If Google falls into the second category, which includes media outlets such as newspapers and magazines, then the search giant may be subject to prosecution under Italian law—as well as in other jurisdictions worldwide—for data protection violations linked to user-generated content.

"I don't see substantial differences among EU and Italian legislation currently in force [about these issues]," says Rocco Panetta, a partner at Italian boutique law firm Studio Legale Panetta and formerly an official at the Italian Data Protection Authority.

The Italian case isn't the first time Google has faced accusations that it's more of an Internet content provider than service provider. In 2006, a Belgian publishing group called Copiepress successfully sued Google for excerpting copyrighted headlines in its Google News service. The next year media conglomerate Viacom (VIA) sued Google for $1 billion for "massive intentional copyright infringement" related to pirated content uploaded to YouTube. The case is still pending. And French fashion retailer Louis Vuitton (LVMH.PA) won a lawsuit against the search giant in France last year for trademark infringement linked to Google's AdWords advertising system. Google has appealed that case to the European Court of Justice in Luxembourg.

"No Smoking Gun"

"The Viacom lawsuit and now this Italian case certainly could be precedent-setting," says an intellectual-property lawyer who declined to be quoted.

What's also unusual about the Italian case is that the charges relate to Google executives and not the company. Google declined to comment, but media reports say the four managers on trial are Drummond; Google's former chief financial officer, George Reyes; its global privacy counsel, Peter Fleischer; and Arvind Desikan, who is responsible for Google Video in Europe. None of the accused men apparently is in Italy now, but the case can proceed without their presence, sources say.

It's not clear why the Italian prosecutor singled out the four executives because none was directly involved with the offensive video. The IAPP's Hughes reckons it will be difficult to prove intent without evidence linking the men to the case. "There's no smoking gun," he says. "Prosecutors must prove they [the execs] had knowledge of the video, which they didn't."

Yet the mere fact that Google employees face criminal charges, adds Hughes, marks a warning shot for other companies' executives and their liabilities toward privacy violations. Most data protection lawsuits are brought against corporations, but there are laws on the books—particularly in Europe—that hold individuals criminally liable. "There's a sense of complacency that criminal sanctions will never be used," Hughes says. "This case might make people think twice."

Scott is a reporter in BusinessWeek's London bureau .