GEICO Loses Court Bid To Limit Google Ties

GEICO Loses Court Bid To Limit Google Ties Auto insurer objected to sale of sponsored links with search results to competitors

In a blow to GEICOs efforts to stop competitors from seeking to attract their customers when they try to locate the insurer through Internet browsers, a federal judge last week threw out key elements of GEICOs suit against search engine Google.

U.S. District Judge Leonie M. Brinkema of the Eastern District of Virginia in Alexandria ruled that the insurer had not presented sufficient evidence to support an injunction that would bar Google from including “sponsored links,” in which other companies can bid to have their links included with results of searches using various keywordsin this case the terms “GEICO” or “GEICO Direct.”

A similar suit by AXA is pending in a French court.

Judge Brinkema ruled that as a matter of law, GEICO had not shown that inclusion of the “sponsored links” with search results causes consumer misunderstandings. “There is no evidence that that activity alone causes confusion,” Judge Brinkema said.

Google's attorney, Michael Page, estimated that the judge's ruling effectively threw out “90 percent” of the GEICO's complaint.

“The real issue,” he said, was whether Google's policy of including the sponsored links is a violation of federal law. Judge Brinkema, he added, “just said that it didn't.”

David Drummond, vice president and general counsel for Google, said the company was “very pleased” with the ruling. “It confirms that our policy complies with the lawparticularly the use of trademarks as keywords,” he said. “This is a clear signal to other litigants that our keyword policy is lawful.”

The ruling was made on a motion by Google asking the judge to decide if GEICO had made a sufficient case that damage had been incurred to continue with the lawsuit.

However, Judge Brinkema did find merit in part of the lawsuit, and will continue the trial to determine Google's liability for instances in which sponsored links made use of GEICO's name in either the text or title of the link, which both sides acknowledged would be in violation of Google's copyright policies.

That phase of the trial will commence after the holiday season, giving the judge time to issue a detailed, written version of her ruling and for the two sides to further discuss a possible settlement.

“The judge's ruling gave Google part of what they were seeking, and it gave us part of what we were seeking,” said GEICO's attorney, Charles D. Ossola, with the firm of Arnold & Porter in Washington, D.C.

Mr. Ossola said that GEICO was seeking damages of $8.65 million for the remaining parts of the lawsuit. He declined to comment on whether Judge Brinkema's ruling would increase the likelihood of a settlement, saying only that “discussions have continued throughout” the process.

In the case, GEICO had argued that the practice of allowing companies to bid on its trademark as a search term was a violation of copyright law. The Washington-based direct writer of auto insurance maintained that the ruling had not closed that debate and that further efforts would be taken to protect its copyright.

“GEICO will continue to aggressively enforce its trademark rights against purchasers of its trademark on search engines and against search engines that continue to sell its trademarks,” said its general counsel, Charles Davies.

The ruling represents a substantial victory for Google, which has suffered setbacks in European courts on copyright issues. The company was forced to change its practices in France due to a lawsuit by Louis Vuitton over trademark issues, and has also been dealt unfavorable rulings in Germany.

Just prior to the beginning of the trial, GEICO reached an out-of-court settlement with Yahoo, Inc. Yahoo also sells sponsored links on its searches, but does not allow companies to bid on the names of their rivals.

GEICOshort for the Government Employees Insurance Companyon its Web site describes itself as the fifth-largest private passenger auto insurer in the United States. It provides auto coverage for more than 5.9 million policyholders and insures over 9.5 million vehicles.

GEICO uses television, radio, print media and direct mail to attract customers to call its 1-800-841-3000 number and to go to its Web site at www.geico.com. GEICO says it “keeps its rates low by dealing directly with the customer,” while offering sales and claim services 24 hours a day, seven days a week.

Reproduced from National Underwriter Edition, December 16, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.