RealTime IT News

Disney to Pay GoTo.com $21.5 Million in Settlement

The trademark dispute between entertainment giant Walt Disney Co. and Internet start-up GoTo.com, centering on a round green logo, was resolved Friday, with Disney agreeing to pay $21.5 million and stop using the logo for its Go.com network.

While not a substantial amount for Disney , which brought in $13.24 billion in revenues in the past six months, the dough could be a lifesaver for GoTo.com . The smaller company lost $30.5 million in its most recent fiscal quarter, and its stock price hit a 52-week low on May 24.

GoTo.com sued Disney in February 1999 in the United States District Court in Los Angeles, saying the green-light-shaped logo the company's Go.com network adopted in December was too close to the circular green logo the pay-for-placement search engine firm has used since 1997.

On November 15, 1999, U.S. District Court Chief Judge Terry Hatter, Jr. granted GoTo.com a preliminary injunction, which meant Disney, Infoseek and related companies had to drop the Go.com logo.

At the time, Disney vowed to appeal the decision, but the companies apparently reached a negotiated settlement before the actual trial date was set. A pre-trial conference was originally scheduled for March.

The decision by Go.com to concede defeat in the battle over the green-light logo, and adopt green lettering with a yellow arrow, marks another twist in the story of a company that's been rocked by turmoil and indecision. The Go Network, a joint venture between Disney and Infoseek, has been marked by high executive turnover, including the conviction of one of its execs -- Patrick Naughton -- for crossing state lines to solicit sex with a minor.

Strategy has shifted at Go.com, too. The company recently abandoned ambitions of being a wide-reaching portal, and instead decided to focus on being an entertainment destination.