A district judge has ruled that Google can continue selling advertising triggered by searches for trademarked brand names. Judge Leonie Brinkema ruled that the adwords program does not violate US federal trademark laws.

Car insurance company Geico brought the case against the Google, claiming that sponsored links - search results paid for by Geico's competitors - illegally exploited its brand profile. The company said the results confused consumers and diluted its trademark.

However, the judge accepted Google's argument that its adwords sales were consistent with other comparative advertising practices in the US. She granted Google's request that the bulk of the case be dismissed, saying: "There is no evidence that that activity alone causes confusion."

This is very good news for Google, as it derives a substantial part of its income from these sales. David Drummond, vice president and general counsel at Google said: "This is a clear signal to other litigants that our key-word policy is lawful."

However, Judge Brinkema said that Geico could continue with the second part of its case. The insurer wants to prevent competitors using its brand name in their advertisements. Google says such ads violate its policies, and that it already blocks them, on request. ®

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