The issue was first reported on Tuesday morning by the Search Engine Land technology news blog, whose editor Danny Sullivan was personally briefed by Google on the issue in recent days.
According to Sullivan's article, Google became suspicious that Microsoft could be copying its top search results for certain queries several months ago and recently ran a "sting" operation to find out if this was in fact happening.
Google hand-coded arbitrary search results for a series of nonsensical query terms, and later discovered that when entered on Bing, these query terms yielded those same results. Google believes that the query and results data is captured via features in the Internet Explorer browser and the Bing browser toolbar.
Later on Tuesday, at the event "Farsight 2011: Beyond the Search Box,", sponsored by Big Think and Microsoft, Google search software engineer Matt Cutts opened a panel discussion by outlining the accusation and invited comments from fellow panelist Harry Shum, a Microsoft vice president.
"It's not like we actually copy anything. It's really about what we learn from the customers, who opt in to willingly share the data with us," said Shum, who leads Microsoft's search development efforts.
Cutts and Shum then got into a back and forth with Cutts pressing the issue and Shum rejecting the allegation.
Asked for an official comment by IDG News Service, a Google spokesman sent a statement via email and authored by Google fellow Amit Singhal that states categorically: "Our testing has concluded that Bing is copying Google web search results."
Google welcomes competition on the basis of improved search algorithms and innovation but "not on recycled search results copied from a competitor," Singhal said.
Meanwhile, Microsoft provided an emailed statement from Bing Director Stefan Weitz in which he downplays the Google accusation.
"We do not copy Google's search results. We use multiple signals and approaches in ranking search results. The overarching goal is to do a better job determining the intent of the search so we can provide the most relevant answer to a given query. Opt-in programs like the toolbar help us with clickstream data, one of many input signals we and other search engines use to help rank sites."
In a Microsoft blog, Shum called Google's accusation "a spy-novelesque stunt to generate extreme outliers in tail query ranking" that doesn't accurately portray how Microsoft uses "opt-in customer data" to fine-tune its search experience.
It's not clear what, if anything, Google plans to do next, such as possibly escalating the matter if it deems it illegal.
What Google clearly accomplished was to insert a loud controversy into the Microsoft-sponsored event that reflects badly on Bing, certainly not the result Microsoft sought when it decided to sponsor the event.