Judge won't toss out Google, Overture suit

U.S. District Judge Denis Hurley said in a preliminary ruling late last month that a lawsuit filed by the former owner of PetsWarehouse.com could proceed, denying the search companies' efforts to get it dismissed. A third defendant is Kanoodle which, along with Overture and Google, displays advertisements and sponsored links based on search terms.

Pet store owner Robert Novak claimed in the suit that he owned the trademark to the term "Pets Warehouse" and that Google, Kanoodle and Overture--which is owned by Yahoo--illegally sold advertising tied to that phrase. The search companies argued that the phrase was generic. But the judge said that without more information, he could not "conclude as a matter of law that the registered mark is generic."

The legal status of trademarks used in sponsored-link advertising remains murky. While one court rejected Playboy's attempts to halt Web sites from selling results based on the term "playboy," other lawsuits are ongoing. Last year, a French court fined Google for selling advertisements based on two travel-related phrases that were trademarked.

It's unclear what happens next. Novak filed for bankruptcy last year and has lost the rights to the PetsWarehouse.com domain. He now runs Pets-Warehouse.com. He did not respond to an interview request sent through e-mail on Monday.

Novak is trying to reclaim PetsWarehouse.com, which was taken from him after a bizarre series of events that began with a $15 million lawsuit he filed against members of an aquatic plant mailing list. A May 2001 discussion thread on the list had criticized Novak's customer service, with one participant quipping: "Remember petSWEARhouse, buy their plants and you'll be swearing!"

The mailing list defendants hired a lawyer named John Benn, who soon found himself the target of libelous comments describing his professional abilities on CompuServe's Aquaria/Fish Forum. Benn claimed that Novak was behind the defamatory remarks and sued him for $70,000 in damages. The lawyer won and managed to take over PetsWarehouse.com to pay for the judgment, but an Alabama appeals court reversed the decision on technical grounds last Friday, saying "we conclude that the trial court lacked personal jurisdiction over Novak," a resident of New York state.

For now, though, Benn still owns PetsWarehouse.com and has turned it into a kind of online gallery highlighting the lawsuits Novak has filed so far. The Web site also includes a legal defense fund for aquarium list members targeted by Novak. The San Francisco Bay Area Aquatic Plant Society pledged to match contributions submitted through PayPal.

In the current case involving search engines, the judge did side with Google in one area. Novak claimed Google was guilty of "tortious interference with prospective business relations," a claim that Hurley said was nonsense.

Novak, who has been representing himself in this and other lawsuits, drew some criticism from the judge for legal filings that are "not a model of clarity." Novak submitted a "confusing response" to Google's request to have the case tossed out, Hurley wrote.

But Hurley let the trademark case against the search firms proceed, noting that because Novak had succeeded in obtaining a trademark registration from the U.S. Patent and Trademark Office, the phrase may not be generic. "Registration provides some indication that the mark is descriptive rather than generic," Hurley wrote.

Google and Overture did not respond to requests for comment.