In the latest trade mark infringement case being fought over Google Adwords’ sales of registered trade mark search engine links to their competitors, the ECJ Advocate General has voiced his (non-binding) opinion before the ECJ itself deliberates. And it’s encouraging news for Google as Emily Devlin reports.
Topic: Online advertising
Who: Google and three claimants
Where: European Court of Justice Advocate General's office
When: 22 September 2009
Law stated as at: September 2009
On 22 September 2009 the European Court of Justice's ("ECJ") Advocate General issued his Opinion in three joined cases brought against Google in relation to the issue of keyword advertising.
Google operates a system called AdWords, which allows advertisements to be displayed alongside natural search results in response to keywords being entered into the Google search engine. Advertisers select those keywords and pay Google on a cost-per-click basis. These sponsored links typically constitute a short commercial message with a link to the advertiser's website, and are distinguishable from the natural search results by their format and placement. Revenue generated by the AdWords programme is used by Google to support its search engine service.
The cases in question were brought by brand owners in France, including LVMH, who complained that Google had infringed their registered trade marks by "selling" keywords corresponding to their registered trade marks to advertisers, thereby triggering sponsored links for those companies alongside the natural search results. The French courts sought clarification from the ECJ on whether that amounts to an infringing use of those trade marks under EU trade mark law.
Advocate General's Opinion
The Advocate General's Opinion is supportive of Google's position and indicates that Google AdWord bidding on a competitor's trade mark is legal as long as the content of any sponsored link and the underlying website does not separately infringe.
In his Opinion, which is not binding on the ECJ but is often indicative of the stance it will take, the Advocate General states that the offering for sale of keywords to advertisers that correspond to the registered trade marks of another company to trigger sponsored links, and the purchase of those keywords by advertisers, does not constitute trade mark infringement.
The Advocate General held that:
The selection of keywords that correspond to trade marks by advertisers in the Google AdWords programme is use solely in relation to the Google AdWords service and is not use in relation to goods and services for which the trade mark is registered. As a result the operation of the Google AdWords programme by allowing advertisers to bid on keywords that correspond to registered trade marks is not trade mark infringement.
For the same reason, bidding on keywords that correspond to registered trade marks by advertisers in the Google AdWords programme is not trade mark infringement.
Similarly the return of sponsored links in response to a Google search using a word corresponding to a registered trade mark does not amount to infringement by Google. This is because the use of the trade mark by Google does not conflict with the essential functions of the trade mark.
In particular the Advocate General was of the view that consumers will understand that the results returned both in the sponsored links section and in the natural search results, will contain links to websites other than those of the trade mark proprietor and will need to be sifted through.
The Attorney General drew a very clear distinction between, on the one hand the operation of the AdWords facility by Google and the use of that facility by advertisers and consumers and, on the other hand, the content of any links and underlying websites that may separately infringe.
To the extent that Google has any liability for any infringement resulting from the content used by the advertiser in any sponsored link or natural search results or in the underlying websites, Google cannot rely on the liability exemption for internet hosts under the E-Commerce Directive.
Why this matters:
Should the ECJ choose to adopt the Advocate General's reasoning, this will secure Google's revenue stream from the AdWords programme and could mean open season on keyword bidding. However, advertisers will still need to ensure that both the content of the sponsored link and the underlying website do not separately infringe their competitors' trade marks.