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Companies suing Google for allowing competitors to place ads triggered by their trademarked keywords is nothing new; Geico famously did so in 2004, followed by Rescuecom, JTS Tax, Jews for Jesus, Cash ‘n Go among others. Some were settled out of court, but generally the judges have ruled in favor of Google.

Google’s trademark policy is that competitors may bid on trademark keywords, but they may not use the trademark in their ad creatives. Coke can bid on the keyword Pepsi, HP can bid on the keyword Thinkpad, etc. The argument is that this is analogous to a pizza joint standing out front of another pizza joint down the street handing out coupons on the sidewalk; adversarial, but not illegal, and nobody is confusing the two pizza places or purporting to be the other. If you do a Google search for “wpromote” you will see a handful of competitors all bidding on our trademark.

Trademark holders don’t like this for several reasons:

  1. They have spent time and money establishing their brand, sometimes decades and many billions of dollars. So in the well-publicized Geico lawsuit, they were not happy at all that they would spend millions on TV ads, only to have people use Google to find the Geico website and potentially end up losing the client to a competitor who would just advertise on Google under the “geico” keyword.
  2. To help combat users going to a competitors site (or even a shopping comparison site, or a retailer’s, for example), companies then generally spend money on paid search for their trademarked keyword to defend against the competitors coming up under their name; it’s just another piece of real estate on the page that links to you. However, to have to spend a lot of money just to guide users to your site that have already expressed that they want to find is a tough pill for companies to swallow. Thus the barrage of lawsuits.

Anyhow, Google’s legal team will be back at it again as yesterday American Airlines filed suit against Google for trademark infringement in what looks like a similar complaint as Geico and the others. This is interesting because American Airlines has deep pockets and apparently is prepared to take this lawsuit all the way. It will be interesting to see how this transpires!

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