In August 2015, the British Columbia Supreme Court ("BCSC") held that purchasing a competitor’s trademark as a keyword for search engines (e.g., Google) is not in itself sufficient to constitute infringement of a common law trademark. Additionally, the BCSC determined that the time to make the assessment as to whether the defendant’s activity is likely to cause consumer confusion, is not when the consumer reviews the initial results page created by the search engine, but rather once the consumer reached the defendant’s actual website.

The plaintiff, Vancouver Community College, claimed that the defendant, Vancouver Career College, misrepresented its educational services as being those of the plaintiff, inter alia, via keyword advertising. The plaintiff argued for common law trademark rights in the term “VCC” as a short form of its name. In a decision issued in January 2016, the British Columbia Court of Appeal (“BCCA”) overturned the above decision of the BCSC. The BCCA reversed the ultimate outcome of the action as well as some of the legal points set out by the BCSC concerning keyword advertising (the BCCA determined that a misrepresentation by the defendant had taken place and that the defendant was therefore liable for trademark infringement).

In addition, the BCCA affirmed the BCSC's finding that solely purchasing a competitor’s trademark as a keyword is not in itself sufficient to constitute a trademark infringement. What matters is the nature and content of the sponsored link, which appears as a result of the keyword and the message it conveys to the consumer. The BCCA also held that the appropriate time to consider confusion is when the consumer views the search engine results page, and not subsequently, when the consumer reaches the defendant’s actual website.

We strongly recommend companies that purchase competitors’ keywords as part of their advertising and search engine optimization strategy to ensure that they comply with the various applicable legal rules.