The Wall Street Journal reports the reason for Google documenting them putting aside $500 million was to pay a settlement to the Department of Justice over allowing illegal activity within their ad network.
In February 2010, Google shocked the advertiser base by allowing certain drug ads within AdWords. I am not sure if this is why Google is being sued (or settling with the DOJ) but it was the first time Google allowed any type of drug related ads in their network - as far as I know.
Later that year, Google sued rogue advertisers for using it as a loophole to advertise fake drugs and illegal drugs.
But Google was still investigated by the Department of Justice and maybe this is what came of it?
Forum discussion at WebmasterWorld.