A federal judge ruled in Google's favor yesterday in the first U.S. court ruling that search engines can sell advertising triggered by trademarked terms.
A District Court judge in Alexandria, VA, threw out charges brought against Google by insurance company Geico that Google violated trademark law by showing paid listings when searchers entered Geico's trademarks.
Judge Leonie Brinkema ruled that paid listings, marked as “Sponsored Listings” on the right side of Google's search results pages, do not cause consumer confusion, a key consideration of trademark law repeatedly emphasized by Google. He issued a summary judgment for Google, ending the pivotal complaint by Geico in a case that began Monday.
Google has faced several trademark claims over its advertising system, which accounts for 98 percent of its revenue. Judges in Europe have ruled against the company, but the Geico case was the first trademark case to come to trial in the United States. Google still faces trademark cases brought by American Blind & Wallpaper and insurance giant AXA.
Geico and others have complained that Google's listings confuse customers looking for their Web sites by showing paid listings from other companies, often competitors. The suits also contend the paid listings unfairly capitalize on the brand value of the trademarks.
Google altered its trademark policy in the United States and Canada in April. The new policy lets advertisers bid on trademarked terms, but not use them in ad copy. Reebok could bid on the keyword “Nike” but not use the term in its paid listing keyed by that term. Previously, Google would remove a term from auction if a trademark owner requested.
Brinkema still will consider whether including trademarked terms in the text of paid listings is a violation.
Google has said it is the responsibility of advertisers to obey trademark law, and that as a publisher it should not act as an arbitrator of infringement claims. Outside of the United States and Canada, however, Google continues to remove trademarked terms from its ad auction upon request.