Google (NASDAQ: GOOG) is set go on trial starting November 9th for alleged trademark infringement. The case goes to the very core of Google's business model, and whatever the outcome, it is likely to have a huge impact on Google.
Basically the logic of the allegations is this: If someone Googles the word Nike and an ad for another shoe brand comes up and the user clicks it, should Nike be entitled to a portion of the revenue?
Auto-insurer GEICO sued and settled the case after a Virginia judge ruled partly in Google's favor. However Google recently lost a case brought by luxury goods maker Louis Vuitton.
But here's another interesting question that I wonder about: If someone Googles "Louis Vuitton" or "Gucci" and an ad comes up for an outlet that sells knock-off luxury goods, could Google be held responsible for aiding and abetting counterfeiters?
Numerous questions surround the legality of Google's business model, and investors need to pay careful attention to these issues.
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Reader Comments (Page 1 of 1)
5-14-2007 @ 9:42PM
Tom Crandall said...
The fact that this is a jury trial will stop Google in it's tracks of allowing third parties to advertise on federally protected trademarks.
Google Lawsuit
5-14-2007 @ 9:40PM
Tom Crandall said...
More on the story http://www.semreportcard.com/googles-advertising-policy-on-trademarks-costs-corporations-millions-as-google-obscenely-profits-from-the-illegal-practice/