American Airlines has filed a lawsuit against Google in a U.S. District Court in Texas, alleging that the search giant allows competitors to unfairly use the pay-per-click advertising system to steal business away from the airline, according to a Reuters report.

Google had prevailed in a similar case filed by auto insurer GEICO, but will go to trial in California against American Blinds and Wallpaper to defend claims that it violated trademark laws by selling certain search terms.

In the American Airlines case, the plaintiff alleges that Google sold the terms "American Airlines" and "AA.com," the carrier's website, to other companies.

American Airlines insists that Google's policy allows other companies to "free ride" on its brand. However, Google maintains that it's on solid legal ground.

"We are confident that our trademark policy strikes a proper balance between trademark owners' interests and consumer choice, and that our position has been validated by decisions in previous trademark cases," Google said in a statement.