1. What’s the change?

As at 23 April 2013, Google will no longer restrict an advertiser’s use of a competitor’s trade mark(s) as keywords in Australia.  The updated policy is neatly summarised here.

  1. Can I use my competitor’s trade mark as a keyword?

Google and other search engine providers’ policies currently permit using a competitor’s trade mark as a keyword (and likewise, allows the trade mark within the ad text) if the seller/distributor offers legitimately-marked goods, even if no association exists between the retailer and the trade mark owner.

In the context of trade mark infringement, passing off and misleading or deceptive conduct, one must consider the operation of Google and others’ search engines, as well as users’ knowledge and expectations of how they work.

The High Court has already decided that Google itself will not be liable for misleading or deceptive conduct when its search engine displays in its sponsored links the misleading representations of advertisers (see case summary here).  However, that is not to say that an advertiser may freely use a competitor’s trade mark as a keyword.

No two situations are the same.  Appropriate use of a competitor’s trade mark as a keyword can only be determined by examining a number of factors, including a particular search engine’s adopted search criteria, whether the displayed results are organic or sponsored, the text of generated advertisements and the ordinary and reasonable user’s understanding of the resulting outcomes.

Liability hinges upon whether use of a competitor’s trade mark as a keyword constitutes ‘use as a trade mark’.  Google’s revised AdWords policy states that one goal is to ‘provide…users with the most relevant information, whether from search results or advertisements’, thus providing ‘more choice’.  Along those lines, one argument is that trade mark keywords identify users with an interest in particular types of products and the search engine merely discloses possibilities.  The keywords are not serving as a badge of origin and they are in that manner not used as a trade mark.

On the other hand, if in other circumstances the resulting advertisement text incorporated the trade mark, for example, it is arguable whether the keyword differentiated one trader from another.  As it stands, the issue in the context of trade mark infringement has not yet been fully tested in the courts and it would be advisable to seek legal advice prior to purchasing a competitor’s trade mark as a keyword.

  1. What are my options if a competitor is using my trade mark as a keyword?

Under the revised policy, Google will still investigate and may restrict the use of a trade mark within ad text.  Google is likely to allow the trade mark use if it is acceptable use as described below.

Should a competitor use your trade mark as a keyword, it would depend on the particular circumstances (examples outlined above) whether a trade mark owner had a strong case for trade mark infringement.

Regarding misleading or deceptive conduct, liability will attach if resulting banners, advertisements or sponsored links are not sufficiently distinguishable from organic results.  This will be increasingly difficult to prove as users become more sophisticated and as a result now expect that the various types of search results will appear on the screen.  If the owner’s trade marks do appear within the advertisements, it then becomes a question of whether they suggest any association with the competitor, or if there is a likelihood of confusion.  Acceptable use of a competitor’s trade mark includes nominative use (using the mark to refer to the owner or its goods/services), using the mark in a descriptive sense and comparative advertising.