Google could be forced to rebrand its e-mail service across the whole of Europe following its failure to properly register "Gmail", according to a leading trade mark lawyer.

It is estimated Google could have run up a legal bill totalling hundreds of thousands pounds in its attempts to register Gmail as a trade mark in the European Union. But the real hit could be the loss of face the company could now suffer if it is forced to ditch the brand across the territory.

The internet search company announced today that it had dropped the "Gmail" name in the UK, following a long-running dispute with London-based Independent II Research (IIIR), a tiny British financial research team, which claims to hold the right to use the trademark.

Google said it made the switch from Gmail to Google Mail in the UK voluntarily and to avoid "distraction and confusion" for its users. It continues to dispute IIIR’s claims to the trademark and says the name change will not affect the way in which Google Mail users access or send mail.

However, according to Mike Lynd, a partner at Marks & Clerk, the UK’s largest patent and trade mark law firm, Google "has a real battle on its hands" in gaining the right to use the Gmail trade mark within the European Union because the name was previously registered by a German company – in 2000 – and has also been used by IIIR since 2002. Google launched its e-mail service last year.

Mr Lynd said that the applications made by IIIR and Google for a Community Trade Mark – a blanket registration of the Gmail trademark across the European Union – would probably be blocked by Giersch Ventures, a company that already holds the rights to the name in Germany.

Earlier this year, Google lost the right to use Gmail in Germany, following a dispute with the Hamburg-based finance firm. Giersch registered "Gmail – und die Post geht richtig ab." with the German Patent Office five years ago. Following a court injunction awarded by a German court in favour of Giersch earlier this year, Google’s German customers have been using addresses ending @googlemail.com.

"Although IIIR, Google and a few hopeful opportunists have all rushed to file a Community Trade Mark for the Gmail mark, Mr Giersch’s existing German registration will undermine all of these applications," Mr Lynd said.

Meanwhile, IIIR says it launched "G-MailTM web based email" in May 2002 - nearly two years before Google unveiled its own branded e-mail service, known at "GMailTM". IIIR’s version of G-Mail was developed by one of its subsidiaries, Pronet, which specialises in research about the currency markets.

Mr Lynd said: "IIIR – because of rights acquired as a result simply of its use of the Gmail mark in the United Kingdom since May 2002 – seems likely to end up with the ability to prevent Google from using Gmail in every EU country other than Germany.

"My advice to Google would be to cut their losses now and to look at re-branding to Google Mail within the whole of Europe. For other companies, it is a salutary lesson in how not to adopt a new trade mark."

"While Google has successfully built the Gmail brand in the mind of consumers, it will now be forced, as a result of inadequate IP searching and protection, either to give up, or to substantially curb its use, of its brand," he said.

Users already signed up to Google’s Gmail service can continue to use their @gmail.com addresses as usual, new users signing up from today will be given an @googlemail.com address instead.

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