Google and Yahoo might crow about supporting the entertainment industry, but a new report says that hasn’t stopped the two Internet giants from placing ads on sites with pirated movies, TV shows and music.  The report looked at analysis of which sites have the most copyright infringement notices against them and found that Google and Yahoo are in the top 10 ad networks that support major piracy sites. Ruh roh.

USC’s Annenberg Innovation Lab issued the report , and the Los Angeles Times says that while Yahoo hasn’t responded, Google called the report’s findings “mistaken.”

“To the extent [the study] suggests that Google ads are a major source of funds for major pirate sites, we believe it is mistaken,” a Google spokesperson said. “Over the past several years, we’ve taken a leadership role in this fight. The complexity of online advertising has led some to conclude, incorrectly, that the mere presence of any Google code on a site means financial support from Google.”

It’s the first part of a monthly occurrence that the Lab’s director hopes will highlight how rampant the support of piracy sites by major brands’ advertising dollars is. Maybe some of those companies will decide not to shell out the big bucks.

“Whenever we talk to a brand about the fact that their ads are all over the pirate sites, they’re like, ‘Oh, how did that happen?'” the director said. “We thought it would be easier if they knew what ad networks were putting ads on pirate sites — so they could avoid them.”

Google and Yahoo are in high-powered company, according to the Lab, which used Google’s own Transparency Report to come up with a list of other offenders:

The list of ad networks includes Openx, a Pasadena company that was backed by AOL Ventures and describes itself as a leader in digital and mobile ad technology; Google and its advertising platform, DoubleClick; Yahoo and its ad exchange, Right Media; and Quantcast, a San Francisco firm that also places ads on sites owned by such major media companies as NBCUniversal and Viacom.

So far one big name, Levi’s, has taken action after the Lab showed the company it had ads on file-sharing sites, which could mean others will follow suit when facing similar evidence.

“When our ads were running unbeknownst to us on these pirate sites, we had a serious problem with that,” said Gareth Hornberger, senior manager of global digital marketing for Levi’s. “We reached out to our global ad agency of record, OMD, and immediately had them remove them…. We made a point, moving forward, that we really need to take steps to avoid having these problems again.”

The Lab’s director has a personal reason for fighting piracy in the entertainment industry, as he claims his late friend Levon Helm was forced to go back to touring after piracy made it impossible for him to exist on royalties from his music.

Perhaps this is a better way to stop or at least lessen the effects of piracy — going after the almighty dollar — instead of trying to censor the entire Internet with legislation like the failed SOPA and PIPA measures.

Report links Google, Yahoo to Internet piracy sites [Los Angeles Times]

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.