A recent court ruling in Russia has seen almost 2 billion rubles seized from the accounts of a Google contractor, signaling growing legal tensions between the tech giant and its advertising partners in the region.
The Arbitration Court of St. Petersburg and the Leningrad Region decided on March 18, 2025, to seize 1.78 billion rubles from Sphere LLC, a subsidiary of the Realweb advertising agency. This legal action came as part of a lawsuit filed by Google LLC against Sphere LLC. The substantial amount included 1.36 billion rubles owed for advertising services and 416 million rubles accumulated in interest for the use of borrowed funds.
According to representatives from Google LLC, Sphere partially acknowledged these claims but has yet to repay any debt, leading the court to act in favor of the tech company. "Sphere LLC has almost no liquid assets that could be recovered at this time," stated a Google representative. This lack of available resources prompted the court to impose this seizure. The court noted that failing to take such interim measures could make it difficult or impossible to enforce any favorable ruling in the future.
As of December 31, 2023, records indicated that Sphere LLC had fixed assets valued at just 168.3 million rubles, against a staggering 2.6 billion rubles in total liabilities. This disparity raises concerns about the company's ability to meet its financial obligations. In light of these numbers, it’s understandable why the court felt compelled to seize the funds.
Despite these developments, Sphere LLC has contested the court ruling. The agency's lawyer, Vladimir Efremov, suggested that the seizure would not hinder their operations, claiming, "The arrest of funds will not affect the company's activities because its own reserves significantly exceed the amount of debt." This assertion, however, seems to contrast sharply with the court's findings regarding the company's overall financial situation.
The court's decision also follows a broader pattern in which Google LLC has initiated over 70 lawsuits against various Russian advertising firms since February 2024 due to non-payments related to advertising contracts. Legal expert and lawyer Leonid Ustin pointed out that Google typically presents well-documented cases in court, supported by service agreements and project completion reports, indicating that these disputes more often center around the size of penalties than on denial of debt itself.
Financial audits reveal that the net profit of IA Realweb LLC for 2023 was 355 million rubles, with revenues reaching 13 billion rubles. This context intensifies the scrutiny around Sphere LLC's financial management and its ability to settle its debts.
Adding to Google LLC's legal troubles, a recent ruling from a Moscow court on March 7, 2025, has limited the accrual of judicial penalties (known as astringents) against the company. This ruling stated that the penalty period would only apply up until October 18, 2023, the date that Google LLC was declared bankrupt. As a result, Google cannot be held liable for penalties accrued after that date, which had previously reached astronomical levels of 91.5 quintillion rubles before the limitation was set in place.
The courts stated that all demands for financial recompense from television channels could only be enforced up until the declaration of bankruptcy, underscoring the complex nature of the situation surrounding Google's financial responsibilities in Russia. Once declared bankrupt, the company could not fulfill judicial decisions aimed at unblocking access to its YouTube channels, thus complicating issues of compliance with Russian courts going forward.
Now, as the legal proceedings continue to unfold, both Google LLC and Sphere LLC are navigating a tangled web of contractual obligations and financial reckonings. The implications of these developments carry significant weight—not only in terms of financial recovery but also regarding the future relationships between tech giants and local businesses amid an increasingly contentious playing field. As experts analyze the situation, it remains clear that the outcomes of these lawsuits will be pivotal in shaping the future of advertising partnerships in Russia.
