In our newsletter issued in November 2011, we reported the decision from the CJEU in the ongoing internet dispute between Interflora and Marks & Spencer concerning the latter's bidding on the INTERFLORA registered trade mark as a "keyword". Such bidding ensures that Marks & Spencer's website link features in the "Sponsored Link/AdWord" section on the first page of results after "Interflora" is entered into the Google search engine. Interflora sued Marks & Spencer in the UK for trade mark infringement as a result of this activity.
In its decision, the CJEU stated that the bidding on a third party registered trade mark as a keyword may indeed amount to infringement of the registered trade mark, if the advertisement featured in the Sponsored Link/AdWord section "does not enable reasonably well-informed and reasonably observant internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the advertisement originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party".
It was generally held that, as long as the wording of the advertisement itself did not obscure the origin of the goods or services in question, there should be no infringement.
This matter was therefore referred back to the UK High Court, for it to issue its decision based on the facts of the case, and it has now ruled in favour of Interflora.
The judge (Arnold J) stated that, upon seeing the wording appearing in the Sponsored Link/AdWord section advertising the Marks & Spencer website, the internet user would find it difficult to determine whether there was a link between Interflora and Marks & Spencer. As such, in this particular instance, trade mark infringement was found to have occurred.
Arnold J further commented that "the reasonably well-informed and reasonably observant internet user" may not precisely know how the Sponsored Link/AdWord section operates, and that there was nothing in the wording of the Marks & Spencer advertisement for their website link to inform the user that they were not part of the Interflora network. It was acknowledged that the "business model" adopted by Interflora relies heavily on a network of independent (and separately branded) florist establishments delivering the requested goods, but that it was not for the internet user to be expected to know whether Marks & Spencer were part of that network or not. In this instance, therefore, it could be assumed by the internet user that Marks & Spencer were indeed part of the Interflora network, or connected to it.
Although this UK High Court decision (which may, of course, be appealed), might provide some comfort to owners of registered trade marks who discover that their registered trade marks are the subject of this third party bidding, it is by no means clear that it establishes a general precedent for demonstrating that trade mark infringement occurs because of this activity. As is mentioned above, the facts of this case are somewhat particular in view of the Interflora business model. Obviously, the decision could provide such a precedent to owners of registered trade marks that operate a similar business model.
It is also important to remember that the wording used in the third party's advertisement could be a key consideration. If that wording makes it explicitly clear that there is no connection between it and the owner of the registered trade mark, then it might be difficult to see how trade mark infringement could be found, because the "reasonably well-informed and reasonably observant internet user" would be clearly informed that there was no link between the advertisement and the trade mark owner. As Arnold J himself stated, it is established law that keyword advertising is not inherently, or inevitably, objectionable from a trade mark law perspective.
It would therefore be advisable, at this stage, to make sure that any advertisement which appears as a result of bidding on another's registered trade mark, makes it explicitly clear that it is not linked to the owner of the registered trade mark.