In a combined reference for a preliminary ruling from the Cour de Cassation in France , Advocate General Maduro advised the European Court of Justice (ECJ) to rule that search engines selling keywords to advertisers cannot be liable for trademark infringement. Joined cases C-236/08, C-237/08, C-238/08) Google France & Google Inc. v. Louis Vuitton Malletier, Google France v. Viaticum & Luteciel, Google France v. CNRRH, Pierre-Alexis Thonet, Bruno Raboin & Tiger, franchisée Unicis (Sept. 22, 2009).
Google’s AdWords advertising system allows advertisers, in return for payment, to select keywords so that their advertisements are displayed alongside natural search results in response to running a search on Google. These advertisements typically consist of a short commercial message and a link to the advertiser’s site; they are differentiated from natural results by their placement and design. In the current cases it was established that entering certain trademarks into Google’s search engine triggered the display of advertisements offering counterfeit versions of the products covered by the trademarks or identical or similar products of competitors. The Cour de Cassation referred the disputes to the ECJ for guidance on whether the use by Google, in its AdWords advertising system, of keywords corresponding to trademarks constitutes an infringement of those marks under Directive 89/104/EEC (Trademarks Directive) and whether Google could benefit from the hosting safe harbour under Directive 2000/31/EC (E-Commerce Directive).
In the Advocate General’s view, by allowing advertisers to select keywords corresponding to the claimants’ trademarks, Google was using such marks in the course of trade. However, allowing advertisers to select keywords so that their advertisements are presented as results did not involve the sale of any product to the public. The use was limited to a selection procedure internal to Google AdWords and concerned only Google and the advertisers. Consequently, there was no trademark infringement for the purposes of Article 5(1) of the Trademarks Directive because AdWords was not identical or similar to any of the goods and services covered by the trademarks.
The Advocate General accepted that by displaying advertisements in response to keywords corresponding to trademarks, Google establishes a link between those keywords and the sites advertised. However, this did not constitute trademark infringement. Internet users processed advertisements the same way they processed natural search results. Even assuming that internet users were searching for the site of the trademark proprietor, there was no risk of confusion on the part of the consumer as to the origin of goods and services.
The Advocate General did not consider that Google’s use of trademarks in its AdWords program constituted trademark infringement where the mark had a reputation. Trademark rights could not be construed as classic property rights enabling the trademark proprietor to exclude any other use. The Advocate General expressed concern that, if trademark proprietors were allowed to prevent those uses on the basis of trademark protection, they would establish an absolute right of control over the use of their trademarks as keywords.
With respect to whether Google’s possible contribution through AdWords to trademark infringements by third parties in itself constituted trademark infringement, the Advocate General said that trademark proprietors would have to point to specific instances giving rise to Google’s liability in the context of illegal damage to their trademarks. He suggested that this would need to be determined under national laws.
While accepting that there is nothing in the wording of the definition of “information society services” in the E-Commerce Directive to exclude its application to the provision of hyperlinks and search engines and therefore to Google’s search engine and AdWords, the Advocate General considered that the liability exemption for hosts under Article 14 of that directive could not apply to AdWords. While the search engine is a neutral information vehicle applying objective criteria, that was not the case with AdWords because Google had a direct pecuniary interest in internet users clicking on the advertisements’ links.
Practice Note: If the ECJ agrees with the Advocate General, trademark proprietors, even those of marks with a reputation, will have no recourse against Google under trademark law, at least insofar as it derives from the Trademarks Directive. However, on the Advocate General’s view, AdWords does not qualify for safe harbour protection so that liability may arise under national laws in certain jurisdictions on account of AdWords potentially contributing to internet users being directed to counterfeit sites. This may lead to an inconsistency of approach to the lawfulness of AdWords across Europe .