American Airlines took Google to court over the sale of its keywords to other companies for use in Google searches. In its complaint, filed in U.S. District Court in Fort Worth, Texas, American took issue with Google's practice of allowing other companies to bid on "American Airlines" as a search term, which allows the companies' ads to appear in the paid search field to the right of "organic" search results.

American said "some individuals and entities attempt to take advantage of consumers by marketing their products or services using the brands of others. In effect, they seek a free ride on the reputation and goodwill of another's brand." American said the paid links may "misdirect" consumers to Web sites that compete with American Airlines or sell travel on its competitors.

For example, a recent search using the term "American Airlines" produced a "sponsored link" purchased by American at the top of the page for its site, AA.com. The organic search results produced several links to aa.com and its subsections. But in the paid search field, a link to "Cheap Air Tickets" at cheapoair.com appeared. A search on the site for Chicago O'Hare-Dallas/Fort Worth flights did include American flights -- halfway through the second page of results.

This will not be Google's first trip to the courts over the keyword issue, but it is not often taken on by someone its own size. Previous lawsuits have been brought by American Blinds, JTH Tax Inc., Geico and Check 'n Go. The American Blinds case will go to trial in November. In the Geico case, a federal judge in Virginia ruled that Google's practices were legal so long as a trademark was used only to trigger an ad and was not used in the text of another company's ad. The two companies eventually reached a settlement.

Google also has seen the inside of European courtrooms on the keyword issue. In a recent filing with the Securities and Exchange Commission, it said, "Courts in France have held us liable for allowing advertisers to select certain trademarked terms as keywords. We are appealing those decisions. We were also subject to two lawsuits in Germany on similar matters where the courts held that we are not liable for the actions of our advertisers prior to notification of trademark rights. We are litigating or have recently litigated similar issues in other cases in the U.S., France, Germany, Israel, Italy, Austria and Australia."

After it filed the lawsuit, American took the unusual step of issuing a statement saying it "appreciates and values the importance of the Internet and the convenience that companies such as Google create for consumers around the globe. . .. The business issue American has with Google is not related to their overall business model. Rather, the dispute is centered on Google's process of allowing other companies to purchase the right to use American Airlines trademarks for Internet search."

Eric Goldman, an assistant professor at Santa Clara University School of Law who blogs on technology and marketing, offered a tongue-in-cheek translation of the statement: "We don't have a problem with Google's business model, except the part we don't like."

American's statement added that "in working through this business dispute, American is hopeful that it will continue professional, friendly and fruitful relationships with Google, while finding an appropriate resolution to the trademark issues."