A federal judge in New York has just ruled that Google's practice of selling trademarks as keywords that trigger links to particular Web sites other than those of the trademark holders does not constitute infringement because Google does not actually "use" the trademarks within the meaning of the law.
This ruling was entered on September 28 by Norman Mordue, the Chief Judge of the United States District Court for the Northern District of New York in the case Rescuecom Corporation v. Google, Inc. Judge Mordue granted a motion by Google and dismissed Rescuecom's complaint which alleged trademark infringement with respect to Google's selling of the trademark "Rescuecom" to Rescuecom's competitors as a keyword that triggers the appearance to the competitors Web sites among the search results of Internet users when they enter "Rescuecom" in the Google Internet search engine.
Judge Mordue, for purposes of the motion to dismiss, accepted the allegations in Rescuecom's complaint as true, as required by law in considering such a motion. He nevertheless dismissed the complaint, for reasons explained further below.
The complaint alleges the following facts. Rescuecom is a computer franchising business. It has 67 franchises that offer repair, consulting, networking and Internet services. In 1998, Rescue registered "Rescuecom" as its trademark with the Patent and Trademark Office. Rescuecom asserts that it has become well known and famous in its market and that its trademark is a valuable business asset.
Rescuecom primary Web site is Rescuecom.com. Rescuecom conducts a substantial amount of business over the Internet, and has an average of between 17,000 and 30,000 visitors to its site each month. Rescuecom advertises over the Internet and through Google.
According to the complaint, Google.com is the most popular search engine on the Internet and that its proprietary software lists Web sites in order of relevance as to search terms of Internet users.
One of the programs offered by Google is Adwords. Through this program, an advertiser can bid on keywords an Internet user might enter as a search term on Google. Google then links the advertisement and the sponsored link to the keyword purchased by the advertiser.
Rescuecom alleges that Google does not always identify sponsored links as advertisements, and accordingly, Internet users may believe that a sponsored link is the most relevant Web site among search results.
Getting to the rub, the complaint asserts that many of Rescuecom's competitors advertise their services on the Internet and actually have submitted the "Rescuecom" trademark to Google's AdWords program as a keyword. As a result, it is alleged that customers have been diverted to Rescuecom's competitors when Internet users have used Rescuecom's trademark as a Google search terms. Rescuecom argues that this constitutes trademark infringement by Google.
Judge Mordue has disagreed with Rescuecom and has sided with Google on the question of potential trademark infringement. Why?
In perhaps a first of a kind trademark decision, Judge Mordue, even while accepting all of Rescuecom's alleged facts as true, found that none of these alleged facts established trademark use by Google, and therefore, Google is not liable for trademark infringement.
The judge came to this conclusion in part because "there is no allegation that [Rescuecom's] trademark is displayed in any of the sponsored links about which [Rescuecom] is concerned."
Furthermore, the judge found that "an Internet user who enters Rescuecom into Google as a search term, may still go to [Rescuecom's] Web site(s) by clicking on the appropriate link on the search results page - even though he or she may have other choices."
In addition, Judge Mordue found it significant that "there is no allegation that [Google] places [Rescuecom's] trademark on any goods, containers, displays, or advertisements, or that its internal use is visible to the public."
This, obviously, represents a clean win for Google and its current business model. However, this only is one decision from just one trial federal judge. This case is not binding on other trial judges as precedent (unlike an appellate decision), and it is possible that we have not heard the last of Rescuecom, as it may file an appeal.
Eric Sinrod is a partner in the San Francisco office of Duane Morris LLP where he focuses on litigation matters of various types, including information technology and intellectual property disputes. His Web site is http://www.sinrodlaw.com and he can be reached at firstname.lastname@example.org. To receive a weekly email link to Mr. Sinrod's columns, please send an email to him with Subscribe in the Subject line.
This column is prepared and published for informational purposes only and should not be construed as legal advice. The views expressed in this column are those of the author and do not necessarily reflect the views of the author's law firm or its individual partners.