• by Wendy Davis  @wendyndavis, August 4, 2009

Google is striking back against a search marketer who sued the company for trademark infringement on AdWords.

In a lawsuit filed last week in federal court in San Jose, Google accuses real estate investment guru John Beck of breaking its AdWords contract by suing the search giant in federal court in Texas rather than California.

Beck, who sells instructional materials that teach people how to turn a profit on real estate, alleged that rivals used his name to trigger search ads. He argued that the practice harmed him by confusing Web users and diverting traffic from his sites.

Google now says that because Beck is himself an AdWords marketer, any legal disputes related to search marketing should have been filed in Santa Clara County, as per the AdWords contract.

But Google might not get far with that argument. Yahoo unsuccessfully attempted to make a similar claim when American Airlines sued for trademark infringement. In that case, U.S. District Court Judge John McBryde in Fort Worth, Texas, rejected Yahoo's argument as "completely nonsensical." McBryde found that American Airlines' trademark infringement claim wasn't covered by its search marketing contract, and therefore, need not be litigated in California.

Beck sued Google in federal court in the eastern district of Texas several days after another company, Firepond, brought a nearly identical case in the same locale. Beck and Firepond are represented by the same law firm and are seeking class-action status.

Eric Goldman, director of the High Tech Law Institute at Santa Clara University, says Google has good reasons to want to move the case out of the eastern district of Texas, because juries there have granted large damage awards in patent infringement cases.

Google also is seeking a declaratory judgment stating it did not infringe Beck's trademark by allowing rivals to use the term to trigger search ads. "We filed the declaratory judgment action to ensure that the dispute with John Beck is resolved as soon as possible," a Google spokesperson said. He added that Beck has not yet served Google with the original lawsuit.

Google has been hit with at least eight trademark infringement lawsuits since April, when a federal appeals court ruled against the search company. In that case, brought by computer repair shop Rescuecom, the Second Circuit Court of Appeals ruled that a trademark is used in commerce when it triggers an ad. But that holding only makes it harder for Google to get cases against it dismissed at a preliminary stage. Whether Google or marketers ultimately win these lawsuits will depend on whether consumers are confused by the ads.

Google mostly prevailed in the only case about this issue that it took to trial. In that lawsuit, brought by insurance company Geico, U.S. District Court judge Leonie Brinkema in Alexandria, Va. ruled that consumers weren't confused when rival insurance sellers used the Geico name to trigger search ads. Google and Geico later settled another portion of the case dealing with whether ad copy that included the Geico name infringed the company's trademark.

Most of the recently filed cases are still making their way through the system, but at least two have been dropped, including one by Philadelphia software company Ascentive.

Ascentive's lawyers said the company decided to pursue against the businesses that were buying its trademarks as ad triggers, rather than continue its case against Google. "We have had a fair amount of success in getting those infringers to stop purchasing our client's trademarks through the AdWords program," said Ascentive attorney Jordan LaVine.

A Google spokesperson said the search company did not pay Ascentive to drop the case.

Ascentive also originally alleged that Google wrongly dropped the company's sites from the unpaid listings, but that also appears to have been resolved. A Google search conducted on Tuesday for terms connected with the company yielded Ascentive's sites high in the organic results.