ABWF had claimed that the fact that Google sold the
right to advertise beside search results related to its name
constituted trade mark infringement. Google disputed this and a
court ruling could have settled the contentious issue.
The case will not now go to a full jury trial, which was due in
November after four years of litigation. Google has not changed its
policies or paid ABWF any money, and each side will pay its own
costs, according to company statements.
The retreat will be seen as a victory for Google and its
profitable AdWords system which has been challenged by several
trade mark holders to date.
Google sells advertising based on the exact search term entered
by a user of its search engine. It provides the search engine
results and, beside those, adverts. Advertisers pay to have their
ad displayed when specific terms are typed into the search
engine.
ABWF argued that it was wrong for other companies' ads to appear
when a user searched for its name. It said that that activity
infringed its trade marks.
David Rammelt of US law firm Kelley Drye represented ABWF in the
action. He told OUT-LAW Radio last May that Google violated its
rights.
"Google had been for some period of time both allowing the sale
of our trade marks as keywords to competitors, as well as promoting
that sale," said Rammelt. "Google has felt it is free to […]
trample over those intellectual property rights and you’re seeing
it in not just the trade mark context but you’re seeing it in the
copyright context, you are seeing it in the patent context."
Google said that the decision of ABWF to drop its case
vindicated its claims.
"From the start, we've said that American Blind & Wallpaper
Factory's claims were baseless, and that Google's trademark
policies are perfectly reasonable and lawful," a Google
spokesperson told OUT-LAW. "Now, with trial approaching, American
Blind decided to withdraw all of its claims. We are very pleased
with this outcome and to note that Google has not paid and will not
be paying any settlement fee, our trademark policies remain
unchanged, and we've made no special exceptions for American
Blind."
The agreement between the two parties confirmed that Google
would not be changing its policies in relation to AdWords, and that
it has not made any form of payment to it to drop the suit.
"ABWF expressly acknowledges that Google has not made and has
not agreed to make any payment to ABWF of any kind whatsoever," it
said.
The agreement also indicated that Google was free to retain its
policy and that ABWF would not sue it again over its practices. "So
long as Google does not make a material change in its AdWords
trademark policy that adversely affects ABWF, ABWF covenants not to
sue Google, any direct or indirect subsidiary of Google," it
said.
The case would have been the first keyword-related case to
proceed to a jury trial. The most significant ruling to date was a
victory for Google. In a decision of December 2004, when a Virginia
court ruled that the sale of insurance firm GEICO's trade marks as
keywords was not unlawful because there was insufficient evidence
of consumer confusion.
Last month, American Airlines became the latest trade mark owned
to sue Google over AdWords. It also seeks a jury trial.
