Google in court over ad trademark spat

Paid third-party ads on Google that use the trademark of car insurance company Geico in the text of ads could infringe trademark law and Google may be liable for such ads, according to a recent court opinion.

Although Geico senior counsel Jonathan Shafner said on Tuesday the court opinion signalled that the judge wants the two sides to reach a settlement, he added that he could not comment on any settlement discussions.

If the parties do not settle within the 30-day period, for which the judge granted a stay, trial could continue on whether Google is liable for damages, and what such damages would be, Shafner said. Damages would be awarded if Geico's trademarks are found to have been infringed by non-Geico ads that refer to Geico.

A written opinion, released on 8 August by the US District Court for the Eastern District of Virginia, said Geico had sufficiently established a likelihood of confusion for web searchers who see Geico's trademark in the text of sponsored links paid for by other companies.

The opinion said: "Based on this finding, Google may be liable for trademark infringement for the time period before it began blocking such usage or for such ads that have slipped or continue to slip through Google's system for blocking the appearance of Geico's mark in Sponsored Links."

However, Google does have legal avenues it can pursue in this case.

Eric Goldman, assistant professor of law at Marquette University Law School, said: "Google could say they were not responsible for the ads and that advertisers are." Google could also invoke a special defence used by printers and publishers who argue they are not liable for trademark infringements in ad copy created by their customers, he said.

A Google spokesman did not return an email seeking comment.

Elinor Mills writes for CNET News.com