Search Engines Win Round in Playboy’s Trademark Suit

Internet search engines aren’t in violation of trademark laws when they sell advertisements linked to such trademarked terms as Playboy and Playmate, according to a recent ruling by a federal judge in Santa Ana.

The ruling, the first of its kind in this area of law, is a setback for Playboy Enterprises Inc. in its ongoing trademark infringement lawsuit against search engines Excite Inc. and Netscape Communications Corp.

Legal experts said the ruling could set an important precedent protecting a key source of revenue for search engine companies, which collect millions of dollars from advertisers who want their banners to pop up when users type in certain words.

At most search engines, typing in such keywords as “car” or “loan,” for instance, will produce not only a list of Web sites ranked by relevance, but also banner ads from automobile makers and lenders.

In Playboy’s case, the banner ads produced by searching its trademarked terms are often for X-rated Internet sites that have nothing to do with the Chicago-based adult magazine. In its suit, Playboy accused Excite and Netscape of confusing consumers and infringing its trademark.

But U.S. District Judge Alicemarie Stotler rejected Playboy’s request for a preliminary injunction that would have barred Excite and Netscape from selling ads linked to Playboy trademarks.

In a 44-page ruling, she said that even though those terms are trademarked, they are also “English words in their own right” and not the exclusive property of Playboy, at least not in this online setting.

“The holder of a trademark may not remove a word from the English language merely by acquiring trademark rights in it,” Stotler wrote.

Playboy attorneys said they would appeal the ruling and press forward with their suit. But legal experts said the company’s prospects appear grim because it failed to convince Stotler that consumers were confused by the banner ads or that Playboy was irreparably harmed.

“Every possible way they could lose they did lose,” said John Shepard Wiley Jr., who teaches trademark law at UCLA.

The ruling is the second significant decision on Internet trademark issues in recent months. Another recent case centered on the term “MovieBuff,” a trademark of entertainment company Brookfield Communications Inc.

In that case, the U.S. 9th Circuit Court of Appeals ruled that one of Brookfield’s competitors had violated trademark laws by sprinkling the term MovieBuff in its Internet pages. The rival, West Coast Video Inc., had done so largely so that its Web site would be among the “hits” listed in Internet searches for that word.

In her ruling, Stotler referred to the Brookfield case. But she drew an important distinction, noting that unlike playboy or playmate, “MovieBuff” is not a generic term likely to be found in the dictionary unless the words “movie” and “buff” are separated.

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Times staff writer Greg Miller can be reached at greg.miller@latimes.com.