In its legal battle with Google Inc., American Blind and Wallpaper Factory Inc. is challenging much more than the search engines keyword-based advertising practices. The home decorating retailer also is questioning Googles cherished search algorithms and Web index.
American Blinds lead attorney, in a recent interview with eWEEK.com, made it clear that the scope of the trademark infringement lawsuit filed last week against Google and the search engines partners doesnt end with the sponsored listings for which advertisers bid on keywords. The retailer also is accusing Google of infringing on its trademarks by returning non-sponsored Web search listings from competitors when certain terms are queried, said David Rammelt of Kelley Drye & Warren LLP, in Chicago.
“Our concerns are not just limited to the paid, sponsored links,” Rammelt said. “We are seeing competitors listed when our trademarks are being typed verbatim.”
Rammelt said that American Blind plans to examine Googles algorithms and search technology when the case moves into a discovery phase to fully investigate the extent of infringement. American Blind is seeking damages as well as a temporary and permanent injunction to bar Google from listing its competitors for keywords that match or are similar to its trademarks.
The lawsuit, filed in the U.S. District Court for the Southern District of New York, does not distinguish between the various types of search listings on Googles site or on the sites of the five other defendants named in the suit. Those defendants, which use Googles listings, are America Online Inc., AOL subsidiaries Netscape Communications Corp. and CompuServe Interactive Services Inc., Ask Jeeves Inc. and EarthLink Inc.
Googles main search listings come from its index of 3 billion Web pages and are ranked by its proprietary algorithms. Google also runs keyword-based paid search through its AdWords program. Those listings appear before or alongside the Web search results on its site and those of its partners.
Google officials declined to comment on the allegations in the lawsuit and have said that the company is reviewing the lawsuit and awaiting a decision in its own preemptive filing. In December, Google asked the U.S. District Court for the Northern Division of California for a ruling affirming the legality of its trademark policy for keyword-based advertising; American Blind has asked the court to dismiss that case.
Google, according to court filings, has accommodated American Blind on terms that exactly match its trademarks, including “American Blind & Wallpaper Factory,” “American Blind Factory” and “DecorateToday.” But Google, in letters to American Blind, has insisted that descriptive terms do not violate American Blinds trademarks when entered in a search query. American Blind begs to differ, saying that the returning of any listings from competitors when descriptive terms such as “American Blind” or “American Blinds” are queried is misleading and undercuts its business.
Experts Point to Editorial
According to search engine experts, American Blind will find it more difficult to prove infringement by Google in its regular search listings. Those listings are, in a sense, based on Googles editorial judgment embodied in its algorithms and technology, something one might argue is covered by First Amendment protections, said Danny Sullivan, editor of search industry site SearchEngineWatch.com.
“I dont think a search engine has ever been targeted for unpaid results like this,” Sullivan said. “If American Blind doesnt like what is appeared in Googles editorial columns, then Google might have to right to say, Too bad.”
Also, American Blinds sites do appear in Googles general Web search results when its trademarked terms and descriptive terms are entered and are listed near the top, Sullivan pointed out.
Google has faced lawsuits before that challenge its rankings of Web sites and has prevailed. Internet advertising company Search King Inc., of Oklahoma City, sued Google in 2002 after sites in its ad network were penalized by Google for the way they linked to one another. Search King wanted its previous ranking restored but lost the case.
When it comes to search advertising, though, the American Blind lawsuit could have more far-reaching impacts. It serves as a test case in deciphering the limits of when and where descriptive terms can be used in keyword-based search ads, said John C. Baum, a partner at law firm Townsend and Townsend and Crew LLP, in San Francisco.
“This is defining one of the edges,” Baum said. “Google and American Blind are going to help us to define for the Internet context what is a fair use of a descriptive term as an information finding device. It affects a large part of a very successful portion of the Internet business world.”
Google has faced a series of trademark infringement lawsuits in France, most notably one filed in August by Louis Vuitton SA. These lawsuits have focused more on the use of specific trademarks in keyword advertising rather than descriptive terms.
Google has tried to avoid conflict with trademark holders, often barring competitors from bidding on keywords that match unique trademarks, as it has done for companies such as eBay Inc. and Dell Inc., Sullivan said. But conflict has become almost inevitable with descriptive terms, especially as search companies such as Google earn growing profits from search-based advertising.
The online search industry is growing at an annual rate of about 35 percent and is projected to reach $7 billion in revenues by 2007, according to a report by Piper Jaffray & Co. Paid listings account for a significant part of that growth.
Meanwhile, as the courts continue to work out the trademark boundaries, search advertisers also need to consider their liability and ensure that they are not infringing on a trademark.
“Anytime you bid on a word and understand that its a trademark…you better feel confident that if you go to court you can defend the reasons for doing that,” Sullivan said.