American Airlines has slapped a federal suit on Google claiming that the search giant’s ad system infringes trademark laws by selling search terms such as "American Airlines" or "AA.com" to other companies for advertising.

"Some individuals and entities attempt to take advantage of consumers by marketing their products or services using the brands of others," reads a filing with the U.S. District for the Northern District of Texas. "This lawsuit involves exactly such a situation - efforts by certain companies to free ride on American Airlines' brands through use of Google technology."
The company alleges Google doesn't have the right to sell its name to any other company and that this practice could confuse consumers and divert customers away from American's own site. Furthermore, American wants Google to pay them any money it has made by selling its trademarks and to award unspecified monetary damages to the airline. Several companies, including Geico and American Blinds, have filed similar suits against Google in the past.

Google, on the other hand, believes its trademark policy strikes a proper balance between trademark owners' interests and consumer choice, which has been validated by decisions in previous trademark cases.