A federal judge has refused to dismiss most of a lawsuit against Google Inc over allegations the company improperly scanned the content of customers' emails in order to place ads, according to Reuters news agency.
US District Judge Lucy Koh in San Jose, California ruled on Thursday that the proposed class action lawsuit against Google can proceed.
Nothing in the policies suggests that Google intercepts email communication in transit between users.
She rejected Google's argument that its users had consented to having their email read for the purposes of targeted advertising.
"We're disappointed in this decision and are considering our options," Google spokesman Matt Kallman said in an email, according to Reuters.
Litigation brought by nine plaintiffs, some Gmail users, some not, was consolidated before Koh earlier this year.
The plaintiffs maintain Google violated several laws, including federal anti-wiretapping statutes by systematically crossing the "creepy line" to read private email messages in order to profit, according to court documents.
Google moved to dismiss the lawsuit, arguing in part that the plaintiffs had consented to the scanning when they agreed to Google's terms of service. Koh disagreed.
"Nothing in the policies suggests that Google intercepts email communication in transit between users, and in fact, the policies obscure Google's intent to engage in such interceptions," the judge wrote.
Koh did dismiss two claims brought by the plaintiffs but gave them an opportunity to refile them with additional facts.
Google celebrated its 15th birthday on Thursday with a trip down memory lane, and an update to the search engine formula which helped spawn the tech giant.
The company took journalists on a tour of where it all started - Susan Wojcicki's garage in Menlo Park, California, where Larry Page and Sergey Brin began working on Google in 1998. Wojcicki is currently a Google vice president.
A Google+ page meanwhile included a photo album of the original home search page, and collected dozens of birthday wishes.
But Google, which has grown into one of the world's biggest companies, was not content to just look at the past.
It announced an upgrade to its main search engine, with new ways to integrate its use across different devices.
The overhaul came as part of an update called "Hummingbird" that Google Inc has gradually rolled out in the past month with disclosing the modifications.
The changes could have a major impact on traffic to websites.
Hummingbird represents the most dramatic alteration to Google's search engine since it revised the way it indexes websites three years ago as part of a redesign called "Caffeine," according to Amit Singhal, a senior vice president for the company.
He estimates that the redesign will affect the analysis of about 90 percent of the search requests that Google gets.