In case you rely on Google AdWords as part of your Web-based income generation, take heed. On Thursday afternoon, Google announced a policy change that affects the way AdWords treats trademarks. The new changes will allow the ads to contain trademark terms that would otherwise be proprietary to the company owning them. Dan Friedman is a senior leader of the AdWords team, and blogged about the changes: “In an effort to improve ad quality and user experience, we are adjusting our trademark policy in the U.S. to allow some ads to use trademarks in the ad text. This change will bring Google’s policy on trademark use in ad text more in line with the industry standard. Under certain criteria, you can use trademark terms in your ad text in the U.S. even if you don’t own that trademark or have explicit approval from the trademark owner to use it. This change will help you to create more narrowly targeted ad text that highlights your specific inventory.”

Good for advertisers, bad for the companies who own the trademark. The New York Times quoted one business owner as saying: “I was furious!” Her reason? She encountered a list of advertisements when she Googled her trademarked business name. Her next action was to file a lawsuit.

Formerly, Google’s policy was to prohibit any company, except the company who owned it, from placing trademarked terms in the text of advertisements. If the rest of the advertising industry can do it, why not AdWords?, queries Friedman in his post: “Imagine opening your Sunday paper and seeing ads from a large supermarket chain that didn’t list actual products for sale; instead, they simply listed the categories of products available - offers like ‘Buy discount cola’ and ‘Snacks on sale.’ The ads wouldn’t be useful since you wouldn’t know what products are actually being offered. For many categories of advertisers, this is the problem they have faced on Google for some time.”

While his logic may be a bit fuzzy, Google does have clear policies regarding the new trademark rule. Even though their policies state that, “Google is not in a position to arbitrate trademark disputes between the advertisers and trademark owners,” they may have to answer for themselves in the class-action lawsuits that are sure to follow.

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