A San Jose District Judge has dismissed a lawsuit against Google (NSDQ: GOOG) that sought to hold the Internet search giant responsible for allegedly fraudulent ads created through its AdWords platform, reports Mediapost.com. But Judge Jeremy Fogel ruled that the federal Communications Act protects Google from any liability for the ads, noting in his written decision, “Providing third parties with neutral tools to create Web content is considered to be squarely within the protections of [the law]. Even if a service provider knows that third parties are using such tools to create illegal content, the service’s provider’s failure to intervene is immunized.”

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The plaintiff, New Jersey resident Jenna Goddard, alleged that she was being billed for a ringtone subscription after she entered her mobile phone number at a fraudulent site she found by clicking on an AdWords ad. She argued that Google should be held responsible as the company “violated” its own policy that requires all mobile content ads to take users to a page in which pricing information was laid out clearly. She also argued that she was a “third-party beneficiary” to the contract between Google and its advertisers. Mediapost notes that Judge Fogel dismissed the case “without prejudice,” a move that allows Goddard to file an amended complaint.

Fraudulent ads dangling free mobile content at consumers have become a real nuisance to consumers, and to legitimate providers. Numerous consumers have found that the free mobile content they thought they’d signed up for actually came with a recurring monthly subscription charge. Often times, when they tried to unsubscribe, they found they couldn’t, or were locked in for a certain time period. Just last Friday, the Florida’s Attorney General accepted a $1 million settlement from spam king Scott Richter’s content and marketing company Media Breakaway for failing to properly alert customers of the pricing of mobile content they advertised as “free.”