Here’s some bad news out of the 4th US Circle Court of appeals: It seems that they have revived the Rosetta Stone case against Google which questioned the legality of trademark bidding. This is a dangerous case for the industry, as it revives the debate that was supposedly settled, if companies can bid on trademark terms in Google and other PPC engines.
In 2009 Rosetta Stone, the guys who claim you can learn a foreign language on DVD in only a few short months, sued Google claiming that their trademark was being infringed when Google allowed competitors to buy trademark searches. The case had been dismissed by the US District Court in 2010. However, the appeals court has sent it back basically claiming that the original court hadn’t properly considered the case.
“A reasonable trier of fact could find that Google intended to cause confusion in that it acted with the knowledge that confusion was very likely to result from its use of the marks,” Chief Judge William Traxler wrote for the three-judge panel.
While there has been no decision on what this means, it could mean that a court could decide that there is potential confusion issues on trademark bidding, making it illegal again. This flies in the face of the Network Automation case that was ruled in March 2011 that basically said that trademark bidding was allowed.