Yahoos settle trademark suit

In a case of just desserts, a Texas baker of YA-HOO! cakes that sued search directory Yahoo in a bitter trademark dispute last year now is quietly advertising on the Internet directory's site--and getting results.

Since last week, and just in time for the holidays, the "Original Texas YA-HOO! Cake Company" has been running ads on Yahoo, YA-HOO! cake-company controller Michael Thompson and a Yahoo spokeswoman confirmed today. Why? "We want to sell cakes," Thompson told CNET's NEWS.COM. "We're already getting orders" from the Web advertising.

That's a switch from August 1996, when the cake company asked a Texas federal judge to make Yahoo change the style of its logo and stop using its name on the Net. In this case, Miss King's Kitchens, maker of the cake, hit the market in 1980 and trademarked its logo in 1989.

Yahoo got its trademark for its Internet directory in 1995. The cake company didn't know that someone else was using a similar logo until Yahoo went public last year and became a big brand on the Net.

The case was well publicized and became a much-used example of the escalating battle over trademark names on the Net, ranging from Microsoft to Marilyn Monroe to the Blue Note Cafe.

So why the sudden change of heart with Yahoo on YA-HOO! cake's part? "It's all included in the settlement" of the suit, Thompson conceded.

He hastened to add that the company has a new Web site, too (registered with the InterNIC only last month). It shows color pictures of the YA-HOO! fruit cake, among others. Another is shaped like the Great State of Texas. Cakes range in price from $12.95 to $37. The Web page also carries the disclaimer: "Not affiliated with Yahoo! Inc.--the Internet search engine company."

A Yahoo spokeswoman declined further comment, noting the confidentiality agreement between the two companies.

NEWS.COM designer Jeff Quan contributed to this report.