Google has won a long-running court battle over its use of trademarked brand names in its AdWords platform.
Prosecutors said that the search engine giant was acting illegally by allowing companies to bid for and use brand names they did not own as keywords to trigger ads on Google search results.
The European Court of Justice (ECJ) said, “Google has not infringed trademark law by allowing advertisers to purchase keywords corresponding to their competitors’ trademarks.”
“Advertisers themselves, however, cannot, by using such keywords, arrange for Google to display ads which do not allow internet users easily to establish from which undertaking the goods or services covered by the ad in question originate,” it added.
However the ECJ told Google that companies using trademarked brand keywords to sell good must be more transparent about who the vendor is.
In an entry on Google’s official blog Dr Harjinder Obhi, senior litigation counsel for Google EMEA said, “Some companies want to limit choice for users by extending trade mark law to encompass the use of keywords in online advertising.”
Obhi continued, “Ultimately they want to be able to exercise greater control over the information available to users by preventing other companies from advertising when a user enters their trademark as a search query.
“We believe that user interest is best served by maximizing the choice of keywords, ensuring relevant and informative advertising for a wide variety of different contexts,” he added.
Mark Blair partner at Marks & Clerk Solicitors said the ruling effectively forces brand owners to spend more money on outbidding their rivals to maintain their competitive position online.
“However, this is not a complete blow for brand owners. The Court of Justice has made it explicit that advertisers could themselves potentially be liable for infringement, in particular where an advertisement is unclear as to who is behind it, and it is down to the national courts to determine accordingly.
“We may see more legal action directed at the advertisers themselves on a case-by-case basis at the national courts. If that does happen, we may see knock-on economic implications for Google.”
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