According to this News.com report Digital Envoy's lawsuit claiming that Google breached its contract with the company, can move forward after being denied a summary judgement in a U.S. District Court last week.
The two companies had a licensing agreement as far back as 2000 that relied on Digital's IP technology to pinpoint the physical location of Web visitors for Google so that it could better serve sponsored search results. (The parties no longer work together.) Digital balked when in 2003, Google broadened use of the geo-location technology to include serving targeted advertisements onto third-party sites in a program called Google AdSense.
If you would like to read the full text of the order denying the summary judgement, you can find a pdf copy of the document here.