The scales tip in favour of Google

Updated October 2009

Google has not infringed trade mark rights by allowing advertisers to use other businesses' trade marks as keywords. This was the Opinion of the Advocate General in response to questions referred by French courts in proceedings against Google.

There has been a question mark hanging over this issue for some time and the opinion marks the latest stage in the long running row between trade mark owners and Google.

Facts
On entering keywords into Google, the search engine produces a list of 'natural results' determined on the basis of objective criteria. Alongside this system, runs the Google Adwords system which determines which advertisements are displayed next to the natural results. These ads appear in response to keywords and advertisers are permitted to select keywords that will trigger the display of their ads. The ads generally include a link through to the advertiser's site and advertisers pay Google for this advertising channel.

In proceedings in France, Louis Vuitton and others issued proceedings against Google for permitting advertisers to select keywords, corresponding to their registered trade marks, which triggered the display of unconnected entities' ads. Their argument was that the system infringed their trade mark rights and allowed other businesses to ride on the reputation of their brand. They further complained that many of the advertisers selecting their trade marks as keywords were selling fake or replica versions of the trade mark owner's goods. The French courts decided to refer a number of questions to the European Court of Justice (ECJ).

The Opinion
The Advocate General issued his Opinion setting out his advice to the ECJ in advance of it making its ruling. The Opinion of Advocate General is not binding on the ECJ but it is highly persuasive and is generally followed.

To prove that there had been an infringement of a trade mark, amongst other things, a trade mark owner must show that his trade mark has been 'used' in the course of trade. Google argued that their AdWords made no such 'use' of the trade mark as it was not attached to goods. The Advocate General rejected this and said that permitting others to select trade marks as keywords was 'use' of the trade mark. However, Google's use in this case did not amount to infringement.

In coming to this conclusion, the Advocate General broke down Google's use of the keywords into two:

• permitting advertisers to select keywords to trigger their adverts; and
• displaying those adverts alongside the natural result in response to the keywords.

The Advocate General concluded that "neither the display of ads nor the display of natural results in response to keywords which correspond to trade marks leads to a risk of confusion as to the origin of goods and services. Accordingly, neither AdWords nor Google's search engine affects or is in danger of affecting the essential function of the trade mark."

The Opinion focused on the fact that the arrangement was between Google and the advertiser rather than with the public, the selection of keywords being an internal function of the AdWords system. The Advocate General stated that Google users would not be confused about the origin of goods as they are aware that other sites appear as a result of searching under a certain trade mark. He thought users would make an assessment as to the origin of goods or services on the basis of the content of the ad and the site, rather than the mere fact that it had appeared amongst the results of using the keyword.

Comment
It appears the Advocate General was concerned about extending trade mark law too far into the workings of the internet and has introduced a requirement of confusion which is not necessary. If the Google Adwords is an advertising system which links a brand owners' trade marks to the identical goods of a competitor, it is strongly arguable that no confusion should need to be proved as this is trade mark infringement under current European law and brand owners are entitled to protection. It is to be hoped that the ECJ will not follow the Advocate General in this instance but we will have to wait and see.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at October 2009. Specific advice should be sought for specific cases; we cannot be held responsible for any action (or decision not to take action) made in reliance upon the content of this publication.