Google Doesn’t Tread on American Blind’s Trademarks

Google (NASDAQ: GOOG) and American Blind & Wallpaper Factory have settled their lawsuit over whether the search service tramples American Blind’s trademarks when it sells ads that pop up after Internet users search for terms such as “American blinds” and “American wallpaper.”

I recently complained about how the suit was dragging on, leaving IT managers without clear guidance about how — or even whether — Google’s search system infringes on other companies’ trademark rights. But now we have some answers and they amount to, “Um, no, Google is in the clear on this one.”

American Blind, a private home decor company in Livonia, Mich., sued Google in 2003 and since then, the two have clashed over that intellectual property issue while also fighting about who should produce what electronic evidence. American Blind was found to have improperly destroyed potential evidence — e-mail, mostly — because “its employees were never adequately instructed as to what was relevant or how to search for such material,” a magistrate judge in San Jose, Calif., wrote in June. He fined the company $15,000.

Eric Goldman, a law professor at Santa Clara (Calif.) University who has been following the dispute, points out in his blog that not only did American Blind gain nothing from its trademark infringement case, but it had to pay Google that fine on top of it all. Goldman says American Blind was wrong to sue Google over the trademarks in the first place, adding that suing over keywords is “often irrational.”

Check out the settlement agreement, which Goldman posted. American Blind dropped all its claims and agreed not to help anyone else sue Google down the road.

I’m glad this case is finally closed. But we still don’t know whether *any* trademark infringement claims are enforceable against search companies like Google. Guess we’ll wait for another suit.