Google Scores Victory in Trademark Case

A federal judge ruled Wednesday that Google’s policy to allow ads to be triggered by trademarked keywords is legal and can continue.

“We are very pleased with the judge’s ruling. It confirms that our policy complies with the law, particularly the use of trademarks as keywords,” said David Drummond, Google’s vice president and general counsel.

Google’s AdSense program had been the subject of a lawsuit brought in federal district court in Virginia by auto insurance giant GEICO, a Berkshire Hathaway subsidiary. GEICO complained that Google’s policy to allow competitors to place ads triggered by GEICO’s company name infringed on its trademarks, but Judge Leonie Brinkema decided there wasn’t enough evidence to say infringement occurred.

After GEICO finished presenting its case, Google’s lawyers filed a motion for summary judgment to determine whether showing sponsored links triggered by trademarked keyword caused confusion and infringed on trademarks. Brinkema granted the motion, and halted the remaining portion of the trial to put her decision in writing.

The remaining issue, which does not present the threat to Google’s business model that the first one did, questions Google’s enforcement of its policy to prevent advertisers from using trademarked names in the content of their ads. Google will prevent advertisers from using a trademark within an ad if the trademark owner has asked Google to do so.

Google adopted a more liberal stance in April to allow bidding on all trademarked keywords, contending that advertisers, and not the company, are liable if they infringe upon trademarks. Outside the U.S. and Canada, Google’s policy is to allow neither keywords nor ad text to use trademarked terms.

GEICO had filed suit in April, seeking an injunction preventing both Google and Overture from allowing advertisers to bid on its trademarked terms “GEICO” and “GEICO Direct.” The plaintiff alleged that the defendants’ sale of its trademarks as keywords has resulted in confusion for consumers who were attempting to contact the company or learn about its insurance rates. Overture had also originally been named in the suit, but it settled its case in late November. Terms weren’t disclosed.

Besides this one, the most high profile of ongoing cases against Google is American Blind and Wallpaper’s suit, which also targets Ask Jeeves.

“This is a clear signal to other litigants that our keyword policy is lawful,” Drummond said.