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Just An Online Minute... Google Settles With Geico

Geico and Google finally settled the remnants of a trademark infringement suit that's been kicking around since May of 2004. The terms are confidential, but it's a safe bet that Google didn't give away the house here.

For all practical purposes, Google won the lawsuit last December, after Geico presented its evidence at trial. Federal district court judge Leonie Brinkema had earlier ruled that, in theory, Google's keyword bidding practices potentially violated Geico's trademark. That is, she ruled that Google's policy of allowing Geico rivals to bid for their ads to appear when consumers queried on the keyword "Geico" could infringe on Geico's rights to its name. But whether Google's policy actually did violate Geico's legal rights would depend on factors, including whether any consumers were confused by the ads.

During a short trial last December, Geico presented its best case for confusion: a survey of consumers conducted by Gary Ford -- the same expert Playboy had tapped in a similar lawsuit against Netscape. (That case eventually settled.)

Brinkema didn't find the results persuasive and ruled in Google's favor. But she also ruled that ads that contained the word "Geico" in either headline or copy did create confusion, violating the insurance company's trademark. She left open the question whether Google -- which has a policy against allowing one company to use another's name in ads -- was responsible for the violation.

Brinkema put her decision in writing several weeks ago and adjourned the case for 30 days, so the parties could work something out -- as they just did.

But Google's not totally out of the woods yet. The Mountain View, Calif. search giant still faces similar lawsuits from other companies, including American Blind and Wallpaper.

There's still a chance that one of those companies can succeed where Geico failed, if they can develop more persuasive evidence to show that consumers are confused when they query on one company's name and ads for another company appear as sponsored links.

But if such evidence proves elusive -- if, in fact, consumers are wise to the sponsored search business model -- Google should, and will, prevail again.

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