Many businesses, whether online service providers, retailers, or those restricted to the physical market, use Google AdWords as their primary marketing channel for advertising their products and services. Google AdWords is a service that requires advertisers to pay to have their advertisement and web address appear more prominently in search results for a certain keyword. The issue of "trademark infringement" arises when one advertiser uses such AdWords on which another entity has trademark rights, causing internet traffic to be diverted away from the trademark owner's webpage to that of the advertiser. For instance, if Google enables registered trademarks of a business, say X, to be used as keywords by its competitors, advertisements of X's competitors will display on the search results whenever a consumer searches for X. It either leads to the consumer thinking the ad belongs to X or diverts consumer traffic to the competitor's website. Hence the question arises, whether an advertiser’s usage of competitor's trademarks as keywords/search terms results in trademark infringement?
Recently the Delhi High Court took a stand in one such complaint of trademark infringement in the case of M/S DRS Logistics Pvt. Ltd and Anr .v. Google India Pvt Ltd and Ors The plaintiff, DRS Logistics (owners of Agarwal Packers & Movers) approached the court seeking an interim injunction against Google India, Google LLC, and Just Dial to restrain them from using or allowing third parties to use the plaintiff's registered trademark as a keyword in the ad title. It was argued that the use of trademarks as a keyword in Ad titles caused traffic to be diverted from the trademark owner's website to the advertiser's, resulting in "confusion, trademark infringement, and/or passing off".
The parties stand on the matter
The plaintiffs claimed that several third-party infringers employ Google's services to insert their infringing advertisements when a customer searches for "Agarwal Packers & Movers" on the internet. The lawsuit is directed against Google's mechanism, and the cause of action covered all activities in which the plaintiff's registered trademark is used to divert internet traffic to the infringer's website, causing confusion in the mind of the consumer. It requested the court for an injunction order prohibiting the use of the same as a keyword/meta tag, and so forth.
Despite obtaining rulings in its favor against other parties, the plaintiffs claim that Google continues to deploy infringing advertisements on its platforms. Due to the ineffectiveness of the orders against individual advertisers on the Google platform, they were forced to file suit against the defendants.
Google defended its use of trademarks as keywords, by stating that such usage does not constitute as "use" under the Trade Marks Act, 1999 and that it does not, in any case, meet the requirements for infringement or passing off. According to Google, the Ads program just provides an advertising platform and interface for developing and displaying ads on Google Search, and a keyword given by the advertiser is only used as a "backend trigger" for an Ad to be displayed and is never used in a trademark context.
Court’s stand on the matter
1. Invisible use of the mark can also result in trademark infringement; Google maintained that Section 2(2)(b) and (c) of the Act, must be read in conjunction with and as an extension of Section 29 of the Act. It argued that the use of a mark is defined in Section 2(2)(b) as "the use of a printed or other visual representation of the mark". Similarly, usage must be interpreted as "...part of any statement about the availability, provision, or performance of such services," according to Section 2(2)(c) of the Act. In effect, because a trademark is not visible to the end-user when used as a keyword, it neither meets the requirement of "visual representation" nor qualifies as a "statement" under Section 2(2).
According to the Court, the reference to "use" in Sections 2(2)(b) and (c) of the Act, is only relevant when the context does not state otherwise. Because Section 29(6) of the Act lists four instances of a trademark "use" for the purpose of infringement, a trademark does not have to fulfil the visibility condition set out in Section 2(2)(b). In fact, the Court held that Section 29 (8) makes it apparent that even if no sale occurs, there is an infringement if any advertising takes unfair advantage of the mark or is damaging to its distinctive character.
As a result, the invisible use of a trademark to divert customers from the owners' website to the advertisers' website will be considered use of a trademark for the purpose of Section 29, which includes Sections 29 (6) and 29(8), which deal with advertising.
2. The use of trademark as a keyword in Google Ads creates confusion in the mind of consumers; The defendants further maintained that, even if using third-party trademarks as keywords constituted "use" of a trademark under the Act, such usage did not result in a trademark infringement or passing off since no customer confusion exists. The Court, however, concluded that ads generated by third-party trademarks will cause uncertainty about the source of the offered products and services.
3. Google can’t seek refuge under Section 79 of the Information Technology Act, 2000 (the “IT Act”); As is common for tech companies that provide internet-related products and services, Google sought protection as an intermediary under Section 79 of the Information Technology Act' 2000, which shields intermediaries from liability for third-party content made available or hosted on their platform if certain criteria are met. According to Google, it qualifies as an intermediary since its part in the alleged activity is confined to providing the ad platform and interface. It went on to say that the advertiser chooses and submits all aspects of the ads, including the keywords (which include the infringing material). However, Google’s attempts to seek protection under Section 79 of the IT Act were dismissed by the High Court because of its Keyword Planner tool. Google's Keyword Planner actively offers keywords to advertisers, including competitor's trademark, and gives information regarding web traffic generated by each possible keyword. In this way, the technology effectively incentivizes other parties to bid on its competitors' trademarks. When weighed against the direct monetary advantage derived from the sale of keywords and Google's active engagement in the keyword selection process its intermediary status is not justified.
4. Google's Ad policy is discriminative in nature; In the European Union (EU), Google investigates the use of trademark as a keyword, but not in India. Questioning Google’s lack of policy parity, it urged google to investigate the case in hand.
Despite the lengthy arguments, the Court eventually dropped the interim petitions under consideration. The Court, however, ordered Google India and Google LLC to;
- investigate complaints from the plaintiff alleging the use of its trademarks as keywords;
- investigate and assess the overall impact of an advertisement to ascertain whether it results in trademark infringement and
- if found that the use of the plaintiff's trademark as a keyword result in trademark infringement then remove such infringing ads.
International Perspective on the usage of a trademark as a keyword in Google Ads
Over 50 lawsuits have been filed against Google AdWords in the previous decade, with the majority of the outcomes being unfavorable to the plaintiff. Trademark owners have a mixed record in Google AdWords disputes.
The Court said in Merck & Co. Inc. v. Mediplan Health Consulting Inc. in 2006 that the use of the disputed keyword is more like the product placement marketing strategy used in retail stores, where a drug store, for example, places its generic products besides the similar national brand products to profit on the latter's goodwill. The electronic counterpart of such product placement in a retail store is the sponsored link marketing approach.
In one of the cases between LV and Google, which was decided by the French Supreme Court that the use of keywords is not for Google's own communication, but for the communication of its clients. As a result, it was decided that it was of no "use" in the course of business. Furthermore, Google had to be actively involved to be held liable, and its involvement is simply "technical and passive". It was also stated that if the keyword impacts the mark's ability to reveal the origin of the goods and services, the advertiser would be held liable for trademark infringement.
The Court of Justice of the European Union (CJEU) decided in the case of MK advokaten GbR v MBK Rechtsanwälte GbR in July 2020 that “it is settled principle of law that a party ordering online advertising containing a sign which is identical or similar to another party's trademark would constitute 'use' under Article 5(1) of the Directive”. In conclusion, it can be said that the decisions, in general, have been somehow in favour of the service providers, like Google. There is much uncertainty and a different opinion on a case-to-case basis.
Indian Perspective on the usage of the trademark as a keyword in Google Ads
The issue of trademark infringement through Google AdWords was revisited by the Madras High Court in Matrimony.com Limited vs Kalyan Jewellers India Limited and Ors. in March 2020, where the Hon'ble Court refused to grant Matrimony.com an injunction for trademark infringement through the Google AdWords program. The Matrimony.com mark, according to the Court, was general and descriptive in nature. In terms of infringement, the Court found that Kalyan Jewellers had simply utilized 'AdWords' to get access to a platform where customers could pick which websites to visit. The Court also noted that an action for passing off could not be made out as Matrimony.com’s marks were generic in nature, and giving it a monopoly over the marks would lead to lesser choices for the customer.
In a recent trademark infringement action brought by Indian EdTech upgrade against another EdTech, Scaler, the Delhi High Court prevented Scaler from bidding on upgrades trademarks through the Google Ads Program. Furthermore, in Policybazaar Insurance Web Aggregator & Anr. v. Acko General Insurance Ltd. & Ors, the Delhi High Court ruled that the defendant's use of the plaintiff's mark "POLICY BAZAAR" as keywords constituted infringement under Section 29 of the Act, and granted an injunction against the defendant.
The Delhi High Court has clearly said in M/s DRS Logistics Pvt. Ltd. and Anr. v. Google India Pvt. Ltd. and Ors that using third-party trademarks as keywords on search engines constitutes "use" and, as a result, infringement of the mark within the Act's purview. Importantly, this establishes a strong precedent for the several lawsuits against Google over its keyword policy that are now pending in courts around the country. Several interim rulings have been made by the Delhi High Court in favour of several plaintiffs, prohibiting their competitors from using the plaintiffs' trademarks as keywords in the ad title. The Court's ruling in DRS, on the other hand, is one of the few in the country that holds Google directly liable for its Ads policy and its active engagement in intellectual property infringement. The Delhi High Court's ruling also reflects the overall stance of Indian jurisprudence on the issue.
It's evident that search engine advertising has radically changed the landscape of digital ads, resulting in a worldwide marketplace with the potential to enhance trade liberalization. Therefore, answering the question of whether Google AdWords policy of using trademarked terms as keywords would constitute “use” under trademark law, the interpretations must be made in such a way that they do not disrupt the balance between competing entities while also being consistent with other nations' interpretations of the "trademark use" requirement.
