A US judge said parts of a false advertising lawsuit can proceed against online coupon distributor Groupon, according to an lawyer who was at a court hearing yesterday.

A proposed class action was filed against Groupon earlier this year by a tour operator in San Francisco, accusing Groupon of bait and switch advertising. Groupon allegedly buys tour-related keywords on Google’s AdWords service, but often does not actually offer tour coupons when customers arrive at the site, the lawsuit alleges.

The practice drives up the cost of keywords for the tour company while the prominence of its ads in Google searches falls, the suit said. A Groupon rep declined to comment.