A would-be competitor was doing this with my domain name, even though his clientele and what he sells are different from mine. I guess he just figured he'd scoop up some traffic. This was a while ago, but as I remember I was able to say that he was using a term in his ad that was misleading, since the ad did not point to my domain or offer any info or whatnot about my domain on the landing page. I also contacted the individual and told him to remove my domain name from his ad or I would contact AdWords and he would lose his AdWords account. After whining some, he removed it.