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Google Uses Blog to Spin Court Decision

The meaning of a recently published ruling in the trademark infringement case between Geico and Google is being fought in the court of public opinion.

Last week, U.S. District Court judge Leonie Brinkema published her written decision in the case brought by Geico over Google's former practice of letting advertisers in its AdWords program use competitor's trademarks.

After news stories appeared saying Google had lost the case, David Drummond, Google vice president and general counsel, took the unusual step of posting a riposte on the company blog.

"There have been a few erroneous reports suggesting that a judge ruled against Google in a case involving Geico," he wrote. "It's actually the reverse of that, so we thought we'd clarify a few things about that decision."

Geico executives could not be reached by press time.

There are two Google practices at issue in the case: letting AdWords advertisers use competitors trademarks in the texts of their ads and letting them pay to have their ads appear when a searcher types the competitor's trademark term in the query box. Google has discontinued the former.

For example, Google wouldn't allow an ad that said, "Insurance rates cheaper than Geico." However, it does let insurance companies pay to have ads saying "Low-priced insurance" appear when someone searches for "Geico."

Judge Brinkema ruled that the use of Geico's trademarks in paid advertisements violates the law. She wrote that Geico "established a likelihood of confusion, and therefore a violation of the Lanham Act, solely with regard to those Sponsored Links that use GEICO's trademarks in their headings or text."

However, she did not decide whether Google should be held responsible, or whether Geico needs to go after the advertisers themselves.

Drummond pointed out that Google already prohibits advertisers from using someone else's trademark in their ad text when the trademark owner objects.

On the second issue, Judge Brinkema said that Geico had failed to prove that using its name as a keyword to trigger ads was likely to confuse consumers.

Foreshadowing possible legal arguments, Michael Kwun, litigation counsel at Google, told internetnews.com, "We don't sell keywords, we sell ads. People choose the keywords."

Kwun said Google had instituted a policy forbidding the use of trademarks in ad text before Geico brought suit, but some such ads had slipped through the system. "Today there's much less chance for anything like that to happen," he said.

Geico and Google met in court in December 2004, after Geico complained that Google's practice of selling its name as a key word against which to display advertising is an abuse of its trademark.

Google is working through a similar legal wrangle with American Blind & Wallpaper Factory, which sued Google in May 2004 for trademark infringement in a beef over Google's lucrative AdWords search advertising service. That case is thornier, because American Blind wants Google to stop selling words that could be considered generic, such as "wallpaper."

"The fact that Google used its blog to respond is remarkable, in that the Google blog is best known for its vanilla texture," said Shel Israel, co-author of the upcoming book "Naked Conversations: How Blogs are Changing the Way Businesses Talk with Customers." He added that it's important for companies to make sure they're part of the conversation taking place on Internet blogs.

"When a conversation's going on about you and there's an increasing number of people watching, you cannot stay out of it," Israel said. "Companies that take this policy suffer repeatedly and consistently."

The court stayed the trial for 30 days to give the parties an opportunity to settle. If they can't come to terms, the trial will continue to determine whether Google or its advertisers should be held liable for the trademark infringement and how much damages they should pay.

"We continue to believe that the sale of Geico's trademarks to its competitors is wrong and a violation of federal and state law and look forward to litigating that issue in future cases," Charles Davies, GEICO's General Counsel, said in a statement. He warned that the company would continue to sue search engines that sold its trademarks as keywords.