bw100 - 9:58 pm on Aug 24, 2011 (gmt 0)

IMHO, the key word here is "settlement".

A settlement can be considered an indicator of several things, among them the desire of the (potential) defendant to avoid both the costs of litigation and the potential of conviction (if the case goes to court).

Google's business decision is seemingly balanced between those two factors.

Legal bills for a Federal Court trial add-up quickly, and escalate rapidly. The actual trial may be delayed for years, with the lawyers' meters are running the entire time.

Toss in the probability (?) of a conviction,

On Wednesday, the government said Google was aware it was violating U.S. law since at least 2003. However, it "continued to allow Canadian pharmacy advertisers to target consumers in the U.S.," the Justice Department said.

and you've got a "slam-dunk" for a settlement decision by the alleged defendant.

(Emphasis: The company is aware that they are violating U.S. law, but continues the illegal business practice for almost 8 years)!
Google took a (business) risk, they got caught, and now they have to pay. IMHO this is not about "justice" (and with large companies it rarely is), but about a penalty ($ plus future business practice stipulations) to pay for the infraction. Now both the DOJ and Google can continue their respective businesses without the inconvenience of litigation.

Good business decision (settlement) following a previous bad business decision (accepting "offshore" pharmacy advertising for U.S. users of Google's search services).

It would be interesting to learn the "other" (non-financial) terms of the settlement: one can hope that the DOJ takes somewhat of a hard line on this, denying Google any confidentiality stipulation, and allowing publication of the settlement agreement.

Maybe some B-school will select this action for a case study in business ethics.