In a Judgment that has been nervously anticipated by both brand owners and the internet advertising industry, the European Court of Justice has ruled that Google’s policy of allowing third parties to buy advertising keywords which contain Trade Marks owned by existing brands is legal.
The phenomenally popular Google “Adwords” product, which displays advertising alongside search engine results based upon the search terms used, has been involved in a number of high-profile disputes since its launch as brand owners have objected to third parties’ ability to bid on “keywords” which contain their Trade Marks; Louis Vuitton’s case is the first to be referred to the ECJ for clarification on what has become an increasingly contentious area.
Google had previously blocked advertisers from using third party Trade Marks as a matter of policy, but changed its stance in the United States 2004, with England and Ireland following suit in 2008.
Google have argued in this and a number of other cases that they should not be held liable by brand owners for Trade Mark Infringement as they only provide the means for the advertisements in question to be displayed.
The ECJ has agreed with them, but has also confirmed that Trade Mark Infringement will take place where a third party’s advertisement suggests an economic link with a Trade Mark owner that could confuse normally informed and reasonably attentive internet users. If Google does not take immediate steps to remove the advertisement in question, then it could also be liable for infringement. This sets out the limits of the “mere conduit” defence upon which Google has relied in previous cases.
The case is of huge importance to Google as its entire business model has been built on advertising, which has proven increasingly successful against the backdrop of a general decline in print media. Brand owners, however, will probably see their rights severely curtailed – Trade Marks require a substantial investment to obtain and the internet enables infringement in a number of different ways. The purchase of keywords which contain Trade Marks allows a competitor to use the reputation of those marks to enhance their own profile, and even though Google has escaped liability, this judgment will more than likely see brands exploring new methods to police their image.