INTA Bulletin

July 15, 2011 Vol. 66 No. 13 Back to Bulletin Main Page

EUROPEAN UNION: AG’s Opinion on Use of Third-Party Marks as Google Keywords

In the past few years, the Court of Justice of the European Union (CJEU, previously ECJ) has handed down a number of judgments regarding the conflict between the use of Google keywords and trademark protection. On March 24, 2011, Advocate General Niilo Jääskinen rendered his opinion in an additional case soon to be decided by the CJEU. As the Court’s judges in most cases follow the opinion of the advocate general, the opinion is important with regard to the requirements to be met in relation to use of third-party trademarks in Google keywords.

The case is based on a UK national trademark infringement proceeding. Both parties in the national proceeding offer flower delivery services. The applicant companies claim that the defendant is infringing their INTERFLORA trademark by having bought various strings of signs corresponding to or resembling the INTERFLORA trademark for use as keywords in the advertising services offered by Google. The Interflora network is made up of independent florists with whom orders may be placed in person or by telephone. Interflora also has websites that enable orders to be placed via the Internet. Orders are fulfilled by the network member closest to the address to which the flowers are to be delivered. INTERFLORA is a national trademark in the United Kingdom and also a Community trademark with a substantial reputation in the United Kingdom and in other EU member states.

Defendant Marks & Spencer plc (M&S) is one of the main retailers in the United Kingdom. It sells a wide range of goods and supplies services through its network of shops and via its website. M&S is not part of the Interflora network. In connection with the Adwords referencing service, M&S reserved “Interflora” and variants thereof as keywords. So, when Internet users entered the word “Interflora” or one of those variants or expressions as a search term in the GOOGLE search engine, an M&S ad appeared under the heading “sponsored links.” However, the ad displayed did not contain any expressions referring to the keyword Interflora, nor did the ad display Interflora’s trademark in any other way.

The Advocate General (AG) began by referring to the recent decision in Google France, in which the Court ruled that there was no liability for search engine operators and that there could be a liability for keyword users under certain circumstances. In particular, the Court ruled that keyword users could be held liable for infringements of third-party trademarks if the ads displayed in the sponsored links did not enable an average Internet user, or enabled a user only with difficulty, to ascertain whether the goods or services referred to originated from the proprietor of the trademark or from an undertaking economically connected to it, or, on the contrary, from a third party. However, the CJEU did not define the requirements for proving the average Internet user’s inability to make this distinction.

The AG concluded that a trademark may be adversely affected even if it is not displayed in the competitor’s ad. In relation to Article 5(1) of the European Trademarks Directive (Directive 89/104) and referring to the Google France case, the AG opined that the average Internet user might perceive M&S’s advertising links as an offer of commercial alternatives to Interflora’s goods or services and, thus, the use of the INTERFLORA trademark as a keyword might not generally be considered an infringement. However, he argued for exemptions from this general conclusion—for example, if the potentially infringed trademark has gained secondary meaning by denoting a certain commercial network of suppliers providing a certain type of delivery service, as had the INTERFLORA trademark for a commercial network of florists, and the reputation of the trademark relates to or is identical to the positive associations this meaning produces in the minds of the relevant circles of consumers. According to the AG, an error concerning the origin of goods or services may also arise when the competitor’s sponsored link is liable to lead some members of the public to believe that the competitor is a member of the trademark proprietor’s commercial network when it is not. In these circumstances, the trademark proprietor should have the right to prohibit the use of the keyword in advertising by the competitor in question.

The AG continued by analyzing the matter in relation to a potential infringement of a trademark with reputation under Article 5(2) of the Directive. He emphasized that the starting point for the analysis of trademark infringement under Article 5(2) must be the effects of the advertisement in the sponsored link as it is visible to the Internet user. Accordingly, the AG concluded that there is no infringement of a trademark with a reputation as a result of dilution by blurring if the trademark is not displayed in the sponsored link ad itself.

The AG went on to discuss trademark infringement in the form of free-riding. He concluded that it was obvious that M&S was taking advantage of the repute of Interflora’s trademark, as it was inconceivable that the selection of the keywords by M&S could be explained by any other motive. Nevertheless, the AG repeatedly emphasized that the question of free-riding had to be analyzed on the basis of the advertisement shown in the sponsored link. If the sponsored link mentioned or displayed the third-party trademark, the acceptability of that use would depend on whether it could be considered legitimate comparative advertising or instead was seeking to ride on the coattails of the trademark proprietor. However, as the INTERFLORA trademark was not displayed in the Marks & Spencer advertisement and there were no additional circumstances for finding illegitimate behavior by M&S, the AG concluded that the mere marketing message by M&S, offering an alternative to Interflora, did not amount to a trademark infringement through free-riding under Article 5(2) of the Directive.

Although the AG discussed the matter extensively, one possible final conclusion is that the choice of a keyword may adversely affect the origin-designating function of a trademark within the meaning of Article 5(1) of the Directive, even if the trademark is not displayed in the advertisement itself. It is important to note, however, that this was an exceptional case owing to the uniqueness of the INTERFLORA trademark, its high inherent distinctiveness and its use for and by a commercial network. Finally, the AG’s opinion—that a trademark may be infringed, in the vast majority of cases, only if the trademark is displayed in the advertisement itself—is important to consider for future cases.

Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.

© 2011 International Trademark Association