Rosetta Stone and Google have agreed to dismiss a three-year-old
trademark infringement lawsuit in the Eastern District of Virginia
and "to meaningfully collaborate to combat online ads for
counterfeit goods and prevent the misuse and abuse of trademarks on
the Internet," the companies announced in a joint statement on
October 31, 2012.
The lawsuit, which was filed by Rosetta Stone in 2009, centered on
Google's use of sponsored links. Sponsored links are paid
advertisements displayed alongside keyword results in Google's
search engine. Google allows sponsors to purchase certain
keywords, including trademarks, which trigger the appearance of the
sponsor's advertisement and link when the keyword is entered as
a search term. Rosetta Stone challenged Google's policy
of permitting persons other than the trademark owner to purchase
sponsored link space in searches for a trademarked keyword.
According to Rosetta Stone, competitors and counterfeiters were
purchasing ad space on search results for its trademarks and
diverting business. The sponsored links, Rosetta Stone said,
also amounted to infringement and dilution of its trademarks.
The U.S. District Court granted summary judgment for Google in
2010, finding that consumers were unlikely to be confused by
Google's sponsored links platform and that the Rosetta Stone
trademarks were not diluted by Google's actions. The U.S.
Court of Appeals for the Fourth Circuit reversed those rulings
earlier this year and
sent the case back to district court for trial. The terms
of the settlement are confidential, but there is no indication that
the settlement includes any modifications to Google's use of
sponsored links.
With the resolution of this case, only two lawsuits remain pending
against Google for its sponsored links; that number once totaled
over a dozen. Google is still defending against CYBERsitter,
a company that develops and markets internet content-filtering
software, in the Central District of California, where the district
court very recently permitted state false advertising and trademark
claims to proceed over Google's motion to dismiss. Google
is also defending against Home Décor Center, a Home Depot
competitor, in the Central District of California. The latter
suit was removed from state to federal court in July 2012.
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