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On July 2, 2008, Rosetta Stone Ltd., the maker of the Rosetta Stone line of interactive computer software for learning foreign languages, filed a trademark infringement lawsuit in the U.S. District Court for the Central District of California against two New Zealand companies, Rocket Languages Ltd. and Libros Media Ltd. (together ?Rocket?) with offices in Los Angeles, two individuals, and several unnamed defendants. See Rosetta Stone Ltd v. Rocket Languages Ltd. et al, Case No. 08-cv-04402 (C.D. Cal.) A copy of the complaint is available here (from WSJ.com); see also related article from the Wall Street Journal here.

Rosetta owns the federally registered mark ROSETTA STONE for computer software for teaching and learning foreign languages. Rocket sells its own line of foreign language tutorial computer software.

One of the individual defendants, Matthew Weidner, owns and operates the websites http://www.spanishsoftwarereview.com and http://www.topratedspanish.com. The other named individual defendant, Ishmael Lopez, owns and operates the websites http://www.gainspanish.com/rosetta-stone/, http://www.learnspanishreviewer.com, and http://www.spanishscams.com/rosetta-stone/.

According to the complaint, Weidner, Lopez, and other unnamed defendants are part of ?an affiliate advertising program approved and funded? by Rocket in order to promote and sell Rocket?s competing foreign language software products on their websites in return for a 75% commission for every Rocket Languages product sold through their websites.

The primary issue in the Rosetta?s complaint is what is being called ?piggybacking? ? the use by competitors of a company?s trademark as a keyword or in the text of internet ads in order to direct internet traffic searching for such trademarks to their own site. (Click here for Wall Street Journal on the growing resentment by large companies over this practice.)

In this case, Rosetta asserts that the Defendants have purchased the words ?Rosetta Stone? as an advertising keyword in Google's AdWords program and Yahoo's Marketing Solutions program so that when an internet user does a search for ?Rosetta Stone? or similar variation (?Rosetta? ?Rosetta Spanish? etc.), the Defendants? websites appear at the top as Sponsored Links offering Rocket?s language software or as websites purporting to offer information and reviews about foreign language software products.

Rosetta also complains about the use by the Defendants of the ROSETTA STONE mark in the header and text of such sponsored links. The complaint illustrates this with the following examples: 1) the sponsored link advertisement for http://www.topratedspanish.com states, ?Rosetta Spanish A Scam?? in the header of the advertisement and ?Read These Reviews Before Buying Rosetta Spanish!? in the text of the advertisement; and 2) the sponsored link advertisement for http://www.mylanguagereviews.com, owned by one of the Doe Defendants, states, ?Is Rosetta Spanish a Scam?? in the header of the advertisement and ?Don't Buy Rosetta Spanish Before You Read This? in the text of the advertisement.

Rosetta further maintains that the Defendants are using certain websites (http://www.topratedspanish.com and http://www.mylanguagereviews.com) to post ?comparison reviews? of ROSETTA STONE products and other competing foreign language software products, including Rocket Languages products, without disclosing that the sites are funded by Rocket to market its products.

Rosetta also points to some false and misleading information on two of the websites which supposedly claim that Rosetta is not offering a free trial of its software when in fact a free ?online? demonstration of Rosetta?s software is available (Comment: Isn?t there a difference between a free trial of a software and a free demonstration?).

Rosetta also maintains that two of the websites have hyperlinks that purport to direct customers to Rosetta?s official website, but instead lead the user to an advertisement for Rocket?s product (Comment: I could not find evidence of this on one of the sites and the other site is temporarily unavailable).

Rosetta?s causes of action are for federal trademark infringement under 15 U.S.C. §§ 1114 and 1125(a), federal unfair competition and false advertising under 15 U.S.C. § 1125(a), trademark dilution under 15 U.S.C. § 1125(c), state unfair competition and false advertising under California Bus. & Prof. Code §§ 17200 and 17500 et seq., and claims of contributory and vicarious trademark infringement directed to .

Rosetta seeks injunctive relief along with the usual claims for damages. Rosetta also wants the Defendants to remove their keyword advertising and sponsored links from Google and Yahoo, place corrective ads on their websites regarding their ?misrepresentations? of Rosetta?s software, and the removal of the ?false and misleading? comparison reviews of Rosetta?s software from their ?comparison review? websites.

Regardless of the merits of Rosetta's claims (and as most readers probably know, the question of whether use of a keyword even constitutes trademark use is uncertain right now), the lawsuit may have achieved its objective. A search today on both the Google and Yahoo search engines did not result in any Sponsored Links of the type complained of by Rosetta. Of course, it's possible that those sponsored links had already reached their daily advertising budget limit.

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