A federal judge has set November 9, 2007 for jury selection in a historic trademark infringement lawsuit brought on behalf of American Blind & Wallpaper Factory, Inc., following allegations that the system represents an abuse of US trademark law.
Court Order Paves Way for Jury Trial in Trademark Lawsuit American Blind & Wallpaper Factory Inc (ABWF) accuses Google of infringing on its trademarks by including them among Internet search terms that trigger displays of ads from competitors.
Google will face a jury for the first time over its "Adwords" program. A United States District Court judge has lately set a November 9, 2007 as the date to pick jurors for a US civil trial focused on whether Google violates other companies’ trademarks with its hugely lucrative online advertising platform.
In a case that may have widespread ramifications for Google and any company that advertises though its Adwords program, a United States District Court judge rejected Google’s latest attempt to throw out a landmark trademark infringement lawsuit brought by American Blind & Wallpaper Factory Inc. (ABWF), represented by Kelley Drye & Warren LLP.
"The reality is that companies large and small are hurt when Google uses a company’s trademark, without permission, for the benefit of the company’s competitors and Google," said attorney David Rammelt of Kelley Drye & Warren, which is representing ABWF.
"This is the first time a jury will have the chance to hear how Google’s business model takes advantage of companies that have built the value of their trademarks through hard work and investment."
The Court ruled that the case will proceed to a jury trial on most of ABWF’s claims, marking the first time Google will face a jury in an Adwords trademark dispute. According to SEC filings, Google’s Adwords advertising program accounted for over 98 percent of Google’s $11 billion in annual revenues.
ABWF, a leading company in the sale of custom window blinds and treatments and wall coverings, which charges that Google has violated the trademark laws by allowing rival competitors of ABWF to buy the company’s name, and other trademarks, as so-called "keyword" search terms in order to appear as the top listing on Google’s search results page.
In an April 18, 2007 decision denying the key elements of a summary judgment motion brought by Google and allowing the case to go to jury, Judge Jeremy Fogel found that "the evidence suggest that Google used (ABWF’s) mark with the intent to maximize its own profit."
ABWF has produced sufficient evidence of likelihood of [consumer] confusion [to allow the case to be decided by a jury]. This is the second time that the court has rejected Google’s attempt to have the case dismissed.
Under the pay-per-click AdWords system, related adverts appear on a page of search results. This means that if a user searches for McDonald’s, for example, an advert for Burger King or another rival may appear next to the results.
Judge Fogel also observed that "the large number of businesses and users affected by Google’s Adwords program indicates that a significant public interest exists in determining whether the Adwords program violates trademark law."
The closely watched lawsuit is a potentially precedent-setting attack on Google’s incredibly profitable "Adwords" program that the Mountain View, California-based firm uses to target Internet users with ads.
"Adwords" is Google’s proprietary program that enables its paying customers to use search terms, such as ABWF’s trademarks, which trigger displays of advertisements of ABWF’s competitors.
"The case also carries implication for other global companies who resent Google’s profiting off the sale of their brand names and trademarks," says David Rammelt, a Partner at Kelley Drye who headed the team representing ABWF in the case.
"We are gratified that our client will get its day in court, and that Google will finally face a jury for its trafficking in other companies’ intellectual property."
In addition, the outcome of this case will likely affect the consumers using Google’s search engine who are bombarded with unsolicited advertisements when searching for a particular company.
Joel Levine, President and CEO of ABWF, stated: "There is a reason why we have trademark laws. They protect people. Google should not have greater rights than other business in the United States; it should not be able to trample the rights of business owners just because it is a large, powerful company."
Google litigation counsel Catherine Lacavera said that the company is confident ABWF "will be unable to prove" their claims at trial.
The trial will be held in the United States District Court for the Northern District of California in San Jose. Judge Jeremy Fogel is presiding over the case.