• by Wendy Davis , Staff Writer @wendyndavis, March 30, 2006

Google might have prevailed in the only trademark infringement suit against it to go to trial so far, but the issue isn't going away for the search company. The latest development stems from a ruling by a federal district court judge, who held that a trademark infringement lawsuit brought by real estate company Edina Realty, Inc. against rival TheMLSonline.com can go to trial.

Edina Realty argues that TheMLSonline.com has violated Edina's trademark by bidding to appear as a sponsored listing on Google when consumers type Edina's name into the query box. The case appears to be the first one to address whether one company can be held liable for violating a rival's trademark based on keyword bidding, according to Marquette Law professor Eric Goldman, who blogged about the case yesterday.

While insurance giant Geico had a similar complaint, the company directed its legal efforts at Google and Yahoo. Yahoo settled--and, separately, later banned any company from bidding on another's name--but Google took the case to trial and won in all key respects.

Yet, lawsuits against Google persist. Earlier this year, CNG Financial Corp. quietly filed suit against Google in federal court in Ohio, complaining that Google allows CNG competitors' bids to appear as sponsored links when users search for the trademarked name "Check N Go."

While Google isn't a defendant in the Edina Realty case, a decision in the company's favor potentially will deter other Adwords users from bidding to appear as sponsored links when consumers query on competitors' names. And, if that happens, the impact on search marketing could reach far beyond this case.