• by Wendy Davis  @wendyndavis, January 20, 2012

Two North Carolina entrepreneurs have filed a potential class-action lawsuit against Google over its defunct “Google Tags” program, which allowed business owners to beef up their local listings with photos, coupons or other information.

In a complaint filed last week in the Northern District of California, Rachel Frezza and Mauro Rodriguez allege that Google misrepresented the terms of a free one-month trial of the program. They say that Google unexpectedly placed charges on their credit cards during the free trial period.

“We think this is an example of where Google has made a mistake in the way it ran a promotion,” says Chicago lawyer Joseph Siprut, who represents the entrepreneurs.

The complaint alleges that Google offered business owners the opportunity to try Google Tags for free for a 30-day period, after which they could cancel without incurring charges. “In reality, however, Google charged merchants during the 30-day period and then asserted that the trial offer consisted merely of a $25 discount,” the complaint alleges.

The service, which Google discontinued last year, cost $25 per month, per listing.

Rodriguez, who runs a car dealership, says in the complaint he signed up for the program on Nov. 18, 2010, and canceled less than 30 days later. Nonetheless, he alleges, Google billed his credit card for $52. It wasn't clear from the complaint whether he promoted his business with more than one tag.

Frezza, who says she operates a “small holistic healing business,” alleges that she signed up for the free trial without realizing that Google would charge her credit card, which it already had on file.

Frezza and Rodriguez don't say in their complaint whether they obtained refunds from Google. Siprut declined to answer questions about that topic.

Both entrepreneurs allege in their complaint that the company refused to delete their billing information. They argue that California law requires merchants to delete financial data upon request when it's no longer needed. They also allege that Google's retention of the data places them “at a heightened risk of identity theft, fraud and catastrophic financial loss.”

Google declined to comment other than to say it hadn't yet been served with a copy of the complaint.