American Airlines has sued Google Inc., claiming the Internet search company violated a trademark by using the carrier's name to trigger paid ads for competitors.
American, the world's largest air carrier, is one of the biggest U.S. companies to claim Google doesn't have the right to sell its name for use as a keyword in Web searches.
American, a unit of AMR Corp., said it objects to the way Google, which owns the most-used Internet search engine, handles "sponsored links," which show names of rival carriers whenever a user types in the words "American Airlines."
"Some individuals and entities attempt to take advantage of consumers by marketing their products or services using the brands of others," American said in a complaint filed last week in Fort Worth, Texas. "This lawsuit involves exactly such a situation — efforts by certain companies to free ride on American Airlines' brands through use of Google's technology."
Google, based in Mountain View, Calif., is facing other legal challenges over its ad policy, which lets prospective advertisers bid on keywords to appear next to search results for those terms. In its annual report, filed March 1 with U.S. regulators, Google said it has received trademark-infringement claims in the United States, France, Germany, Israel, Italy and Austria.
"Adverse results in these lawsuits may result in, or even compel, a change in this practice which could result in a loss of revenue for us, which could harm our business," Google said in the regulatory filing.
Geico Corp., the auto insurer owned by Warren Buffett's Berkshire Hathaway Inc., settled a similar trademark lawsuit with Google in 2005. Another case, involving American Blind & Wallpaper Factory Inc., an Internet seller of home-decorating materials, is scheduled for trial in November in San Jose, Calif.
"We are confident that our trademark policy strikes a proper balance between trademark owners' interests and consumer choice and that our position has been validated by decisions in previous trademark cases," Google spokesman Jon Murchinson said.
Some companies are suing each other for buying keywords through the Google service. Earlier this month, Utah-based contact lens retailer 1-800 CONTACTS Inc. sued rival Lens.com Inc. in federal court in Salt Lake City.
The trademark-infringement suit by American Airlines, filed in its corporate hometown, seeks a court order to halt Google's policy of letting advertisers buy trademarked names as keywords. The complaint also seeks cash compensation.
American said Google has the ability to change its program and stop the unauthorized use of trademarks and has already done so in Europe.
In a statement, American said it has a "professional, friendly and fruitful relationship with Google" and is working to find "an appropriate resolution to the trademark issues."
American said it wants Google "to stop selling our trademarks to others who are purchasing them and related terms to confuse and/or divert consumers searching for AA.com or American's products."