This appears to be true. -From EE Times, October 8, 1996

Navigate the internet with one hand!

          Matsushita Electric is promoting a new Japanese PC targeted at
          the Internet.  Panasonic has developed a complete Japanese Web
          browser, and to make the system "user-friendly", licensed the cartoon
          character "Woody Woodpecker" as the "Internet guide."  Panasonic
          eventually planned on a world version of the product.

          A huge marketing campaign was to have introduced the product in
          Japan last week.  The day before the ads were to be released,
          Panasonic suddenly pulled back and delayed the product launch
	  indefinitely.

          The reason:  the ads featured the slogan "Touch Woody - The
          Internet Pecker."  An American staff member at the internal
	  product launch explained to the stunned and embarrassed Japanese
	  what "touch woody" and "pecker" meant in American slang.

          Vasilis Theoharakis
          Warwick Business School
          phdvt@razor.wbs.warwick.ac.uk