Judge Puts Stop to Disney’s Logo for Go Network

Walt Disney Co., facing a potentially major setback in the use of its primary Internet brand, will have to stop using its circular green logo for its network of Internet sites today after a federal judge ruled that it too closely resembles the logo used by Internet search firm GoTo.com.

Pasadena-based GoTo.com began using its logo--a green traffic light with the letters “GoTo” in white--in December 1997. Disney began using a similar logo--”Go” in white letters on a green traffic light--in January 1999, when it launched its Go Network of Web sites linked to its various corporate entities..

In February, GoTo.com sued Disney and Infoseek Corp., the entertainment giant’s Internet partner that it is acquiring, seeking to bar the companies from using the Go Network logo because it would confuse consumers. In a preliminary injunction issued late Friday, U.S. District Judge Terry Hatter agreed.

“The court finds that [GoTo.com] has demonstrated that it is likely to succeed on the merits of its claim that [Disney’s] use of the Go.com design mark for the Go Network has caused, and is likely to continue causing, confusion among consumers . . . and that as a result of this confusion, [GoTo.com] will suffer irreparable harm,” Hatter wrote.

GoTo.com didn’t allege that the Go Network name itself was confusing, just the design of the logo. Starting today, Disney will be prohibited from using the Go Network logo, after GoTo.com files a $25,000 bond.

Disney officials said the company will challenge the court order. A trial on the matter is scheduled to begin next spring.

“We are very disappointed in the court’s ruling,” the company said in a written statement. “We are confident that our logo does not impinge on that of any other [company].”

The ruling is still a considerable setback for Disney, which has spent millions of dollars advertising the Go brand since it was launched last January. The Go name and traffic light logo, which was selected by Chairman Michael Eisner, are ubiquitous throughout the Disney empire, appearing on every Disney-owned broadcast network and cable channel, including ESPN and ABC. The logo also appears at the company’s theme parks, in movie trailers and even on cases for CDs sold under the company’s music label.

“Any part of the business that wants to promote an [Internet address] also promotes Go Network,” said Rebecca Anderson, a spokeswoman for Disney’s Buena Vista Internet group.

Dismantling that advertising campaign, even if only to adjust the logo, would be a significant undertaking. “We intend to bring that to the court’s attention,” the company said in its statement.

GoTo.com executives were pleased by the court’s ruling.

“Disney has created a logo which has caused confusion in the marketplace,” GoTo.com Chief Executive Jeffrey Brewer said Sunday. “It confuses customers and sets expectations as to who and what we are. It doesn’t benefit anybody’s business not to have a customer know who they’re doing business with.”

Brewer said GoTo.com will never know how many potential customers it lost because of the confusion. But anecdotal evidence suggests it might have been significant.

In one case, a person selling online ads for Disney’s ESPN Web site called GoTo.com and offered the company the “Disney family discount,” Brewer said. In another instance, a GoTo.com investor mistook a Go Network commercial for a GoTo.com ad, he said.

Coincidentally, the ruling came on the eve of a national television advertising campaign that GoTo.com is set to launch today.

“Without the confusion, our advertising dollars are better spent, and the impact of the advertising is more valuable because people know it’s us and not Disney,” Brewer said.

GoTo.com operates a search engine to help Web surfers find information on the Internet. Unlike other search engines, GoTo.com ranks search results according to which companies paid the most money to appear at the top of the list, similar to the way ads appear in Yellow Pages phone books.

The ruling comes as Burbank-based Disney is scheduled to complete its acquisition of Infoseek on Wednesday.

Sunnyvale-based Infoseek, one of the Internet’s top-rated search engines, provides much of the technology for the Go Network and has been Disney’s partner in the venture.

Disney shares rose 75 cents to close at $25.17 on the New York Stock Exchange on Friday. In Nasdaq trading Friday, GoTo.com shares rose $1.09 to close at $91.22, while Infoseek shares remained unchanged at $33.25.