Google Sued for Trademark Infringment

American Blind and Wallpaper Factory, Inc. (ABWF) recently brought suit against Google for trademark infringement, alleging that Google violates trademark law by allowing ABWF's competitors to purchase search terms covering ABWF's trademarks to display their own advertisements. In April, a judge denied Google's motion to dismiss the case, stating that ABWF produced sufficient evidence of likelihood of confusion, the main element of trademark infringement.

Google's "Adwords" proprietary advertising program currently accounts for 98% of the company’s revenue. The program works by displaying paying customers' advertisements after a user searches ("googles") a keyword. The program also allows costumers to purchase search words based on their competitor's trademarks to trigger advertisements for their own products. This act, as ABWF alleges, leads to trademark infringement.

Courts have held that trademark infringement may be based upon confusion that creates initial customer interest, even though no actual sale is finally completed as a result of the confusion. Applied to the facts here, trademark infringement may result if a consumer googles one of ABWF's trademarks and the result displays an ABWF competitor's advertisement.

This case has the potential to severely hinder Google's business plan and alter Google's user experience. The trial is set for jury selection on November 9, 2007.

Patent Reform Act of 2007 Suggests Major U.S. Patent System Reform

Introduced into both the Senate and House of Representatives on April 18, 2007, the Patent Reform Act of 2007 contains sweeping patent reform measures that, if passed, will lead to the U.S. Patent System's most substantial overhaul in over 50 years.

The major provision of the Act is to transition the filing system from first-to-invent to first-to-file. Currently, the U.S. is the only country to have a first-to-invent system, which requires the USPTO to conduct lengthy interference proceedings to determine the first inventor. However, critics claim that the first-to-file system hurts small inventors who are less experienced with the patent application system and results in sloppier applications. In addition, the Act calls for a new procedure to challenge a patent post-grant.

The Act also proposes reforms to patent litigation. One key feature is that for a claimant to receive damages based on the entire market value of the infringing product, the claimant must show that the patent's improvement over the prior art is the predominant basis for an infringing product. Another provision provides for limitations on damages from willful infringement.

Already sponsored by a large group of bipartisan legislators, the Act is also receiving support from companies such as Microsoft, IBM and Cisco. The companies are hopeful that the Act will increase resources for the USPTO and promote greater innovation and productivity.