SAN FRANCISCO — A home decor merchant has dropped a federal lawsuit attacking Google Inc.'s practice of connecting some online ads to trademarks, handing the Internet search leader its latest legal victory on the prickly issue.
American Blind & Wallpaper Factory Inc. agreed to abandon the nearly 4-year-old case without receiving any payment from Google, according to a settlement dated Aug. 31. The truce also stipulated that Google wouldn't change its long-standing policy that let advertisers place ads tied to a rival's trademark.
The settlement averted a trial that was scheduled to begin Nov. 13. The two sides agreed to cover their own legal costs.
"We are very pleased with this outcome," said Michael Kwun, a lawyer for Mountain View, Calif-based Google.
An attorney for American Blind & Wallpaper didn't immediately return phone calls.
The suit targeted one of the ways Google makes money from its widely used search engine.
Under the practice, a search request for a specific business such as American Blind & Wallpaper triggers commercial links from competitors that bid for the right to show ads under specific terms, or "keywords." Google gets a commission when visitors click on the links, which accompany the main search results.