The Australian Competition and Consumer Commission (ACCC) took the company before the Federal Court due to allegations of impropriety by linking companies to the names of other businesses because they had paid for advertising.
Google argued that consumers are aware that there is a difference between links that have paid to appear as opposed to organic results, which are a by-product of the relevant search words – which can be aided by fresh content.
The ACCC alleged that sponsored links gave advertisers a way to present themselves as being connected to other companies when it was not actually the case.
The ACCC lost the original Federal Court ruling but won on appeal – an occurrence which saw the search engine giant bring the case before the highest court in the land.
The commission has defended its decision to bring the case before the courts, despite the unanimous decision to award the victory to Google.
Three of the High Court's judges said that they were satisfied that the search engine had not broken any laws.
They said: "The ACCC contended that Google, rather than the advertisers, "produced" the sponsored links which are the subject of this appeal.
"That submission must be rejected. It is critical to appreciate that, even with the facility of keyword insertion; the advertiser is the author of the sponsored link."
A Google spokesperson said that the company welcomed the verdict, confirming that the search engine cannot be held responsible for the advertisements that marketers place.