Yes, it's a slippery term so probably not the best word to use, however the majority of display and search ads are served by google and unfortunately this does mean they have little incentive to actually address click fraud, though they do obviously make some efforts, we wouldn't hear stories like the parent post if those efforts were effective. Fraud was reported and went completely unaddressed - that's not really acceptable to my mind and indicates they feel little pressure to mitigate it as that's not an isolated report.

Re the absence of lawsuits, I'm not sure that is positive proof of anything.