Hedge funds offer backing for Google legal challenge

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A small listed UK company that plans to launch legal action against Google says it has received three offers of funding, including two hedge funds, for its litigation against the leading web search company.

Independent International Investment Research (IIIR), which is listed on London’s Aim, the stock exchange for smaller companies, has claimed Google’s use of the name “Gmail” for its free web-based email service infringes its use of the term.

Shane Smith, chief executive and chairman of IIIR, said he received three offers of financial backing for the action from firms seeking a share of trademark sales, in the event that IIR’s action is successful.

Mr Smith would not say which companies had made the offers, but said they were a British hedge fund and a US specialist legal funding company that is affiliated with a hedge fund, as well as a British boutique investment company. The three had contacted him about providing funding, but discussions had not yet occurred, he said.

“Quite literally, they have contacted us either by email or by phone, to say ‘we’re here and we’d like to discuss further with you the possibilities of becoming involved’ - so it’s (at a) very early stage,” Mr Smith said.

Mr Smith said a service branded as “Gmail” had been offered by Pronet, a subsidiary of IIIR, since May 2002, and that he had contacted Google soon after the Gmail launch, but the companies had been unable to agree on a settlement.

“We can confirm that Pronet has contacted Google and that we have been seeking information on their use of the Gmail trademark, but have not received any evidence to establish the rights they have claimed,” a Google spokeswoman said.

IIIR’s Gmail service is part of a suite of financial research products, which allows clients to forward on research to their own customers.

Google in April 2004 launched its Gmail service, which has attracted a large subscriber base despite being in “beta”, or pre-release, form.

Like most of Google’s other product launches, Gmail created a stir – mostly because its storage capacity was much larger than many other free email services, prompting upgrades from competing services offered by Microsoft’s Hotmail and Yahoo.

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