According to attorney and Santa Clara University law professor Eric Goldman, the case could have set some precedent about third-level subdomains (like the “blog” part of http://blog.clickz.com). While trademark law has been shown to apply to a regular domain name, it has not yet been applied to third-level ones, and it’s not clear that it would apply, he said. It would also help define Google’s responsibility in what subdomains it allows to be registered.
It will be a brave judge that rules that subdomains can violate a trademark. There’s very little distinction between a subdomain and a subdirectory (e.g. mydomain.com/google/).