Use of Competitor's Trademark in Keyword Advertising: Infringement or Not?
Grady M. Garrison and Laura P. Merritt
Baker Donelson Bearman Caldwell & Berkowitz P.C.
Michael M. Lafeber Briggs and Morgan, P.A.
I. Introduction
The world is spending more than $20 billion a year on pay-per-click advertising through Google alone. 1 Google’s AdWords program, better known as keyword advertising, allows advertisers to purchase or bid on certain keywords. When a user searches for these words, links to the advertisers’ websites appear in a “Sponsored Links” section of the search results. In addition, Google advertisements with keywords can appear throughout the Google network – including on Google Maps, Google Product Search and Google Groups websites along with websites of affiliated entities such as Virgin Media and Amazon.com – which is estimated by Google to reach 86 percent of internet users worldwide. 2
When the keywords at issue are comprised of generic terms, there are few objections.
But when the keywords include trademarks, intellectual property owners understandably believe the goodwill associated with their marks is being improperly utilized to direct traffic to third- party websites. Examples of these objection-raising third-party websites could include competitor websites, unauthorized retailers, sites offering counterfeit goods or services, or sites designed to appear as neutral information sources that are actually backed by a competing company.
1
David H. Freedman, Mastering Google AdWords, N.Y. Times, Dec. 7, 2010, (available at
2
For example, in the results below for a search of “Tiffany,” the jeweler Tiffany & Co.
appears as the first result, a sponsored link, as indicated by the grey font “Ad” indication in the upper right corner of the beige colored text box, and as the first three non-sponsored links.
However, several additional sponsored links related to jewelry that do not appear to be affiliated with Tiffany & Co. also appear on the right side of the screen:
Google’s AdWords Terms and Conditions “prohibit intellectual property infringement by
advertisers” but Google does not prohibit users from selecting others’ trademarks (registered or
based on common law rights) as keywords. 3 The policy notes that “advertisers are responsible for the keywords they choose to generate advertisements and the text that they choose to use in those advertisements.” 4 However, as courts continue to determine whether and in what circumstances keyword advertising constitutes trademark infringement, the policy is likely of little guidance to those navigating the legal landscape. Rather, advertisers must be aware of varying legal standards that apply in their jurisdiction and trademark owners must determine the most effective ways to enforce their rights.
Google has established a complaint mechanism for trademark owners to report complaints related to use of their trademarks in the text of a sponsored link or as a keyword. The complaint form allows trademark owners to identify its trademarks based on registration numbers or use and acknowledges that it applies different standards to different geographic regions. Google’s policies also distinguish whether the trademark is used in the advertisement’s text or whether the trademark is used as a keyword. For example, in the United States, Google’s policy states that it will investigate the advertisement text only and will not disable keywords in response to a trademark complaint.
5In contrast, in the European Union and the European Free Trade Association, Google’s policy is to remove a specified advertisement that is the subject of a complaint if the keyword in combination with a particular advertisement text is confusing as to the origin of the advertised goods and services.
6At the heart of the debate about whether use of trademarks as keywords constitutes trademark infringement is the philosophical split about the purpose of trademark law. Those in
3