April 20 (Bloomberg) -- Goldman Sachs Group Inc. has been called many things over the years. Plenty of people have raged against its power and wealth. If you spend decades as the most successful investment bank, it goes with the territory.

Calling it the devil may be going a bit far, though, even for the flinty-hearted employees of the New York-based bank.

Last month, a blog called Goldmansachs666.com was set up. Goldman Sachs has taken legal action against the site, alleging it infringes a trademark in the phrase “Goldman Sachs.” The owner of the site, investment adviser Mike Morgan of Jensen Beach, Florida, has promised to contest the litigation and pursue similar campaigns against other banks.

“They might think it is just a Mickey Mouse Web site, but we’re coming after them,” Morgan said in a telephone interview. “It would be really stupid for the banks to try and stop us. But banks do stupid things all the time.”

On one level, this might seem like a dry legal battle about trademarks. On another, it is about freedom of expression. And while Goldman Sachs’s irritation is understandable, the firm is making a mistake in setting loose its lawyers.

In the end, big companies will have to deal with the explosion of opinion and commentary on the Internet. Trying to suppress it just won’t work.

The facts of the case are straightforward: The Web site uses the Goldman Sachs name in its title, but doesn’t make any attempt to pass itself off as an outlet of the bank. On the home page, it states: “Web site has NOT been approved by Goldman Sachs.” Readers are directed to the GoldmanSachs.com site if they want to find out about the firm’s view of itself. Not that anyone could be in any doubt.

Raging Shark

Morgan doesn’t have a bee in his bonnet. It’s more like a raging shark. The site promises to expose “the extent of Goldman Sachs’s part in the current financial crisis gripping the world.” On a side bar, you can click through all kinds of stories about the bank manipulating different markets.

He isn’t planning to stop there. Morgan is establishing similar 666 sites for other financial firms, including JPMorgan Chase & Co., Citigroup Inc., Morgan Stanley and Bank of America Corp. No doubt, their legal departments are already sharpening their pencils and getting their own lawsuits ready.

The polite word for the site would be “eccentric.” It says: “This company is evil and should not exist.” Clearly, neutrality isn’t the tone Morgan is trying to strike.

My Web Site

It is, however, a big step to try and close him down. “Everyone is entitled to their opinions and to share views,” Goldman Sachs spokesman Lucas van Praag said in a telephone interview. “But this is blatant trademark infringement.”

That might be for a court to decide. Although Goldman Sachs is claiming trademark infringement, it is hard to believe that this is really bothering the bank.

So I just registered “goldmansachsislovely.com” (and if you want to buy it from me, guys, it’s yours for a six-figure sum). I haven’t heard a word from any lawyers so far. I suspect that if I fill that site with examples of Goldman Sachs executives being kind to small animals and how the bank brings joy and happiness to the capital markets, I might even be offered a job in their marketing department.

Companies can’t hope to register every variant of their name on the Internet. And even if the lawyers are successful, there is nothing to stop Morgan coming back in a couple of days and changing a few letters in the domain name so that it no longer infringes anyone’s intellectual property.

Two Reasons

The real issue is whether Morgan may run an anti-Goldman Sachs site. He should be allowed for two reasons.

First, Goldman Sachs has received taxpayer funding. It has been bailed out to some degree. That changes the debate. Once you start receiving public money, you volunteer for scrutiny. Inevitably, some of that will be unfair. But so what? Politicians have had to put up with that for years. Now that taxpayer funds are involved, banks have to cope with it as well.

Second, Web logs provide a forum for all kinds of new voices, and companies need to learn how to deal with that. A bank such as Goldman Sachs can’t rely on influencing a few key publications. New commentators are emerging from nowhere and if they can find an audience, they count.

If Goldman Sachs wants to protect its reputation, lawsuits won’t help. The battle is won only by engaging in debate and convincing people of its case. The sooner big companies learn that, the better their chances of survival.

(Matthew Lynn is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this column: Matthew Lynn in London at matthewlynn@bloomberg.net

Last Updated: April 19, 2009 19:00 EDT