Pay Per Click – Can Trade marks can be infringed by the use of Google’s “AdWords” service?

Barry Riley

As many businesses are aware, Google operates a service called “AdWords” which allows third party advertisers to buy keywords (or “AdWords”) which are identical to another’s trade marks. Once bought, when internet users search for the keywords on Google, the advertiser’s adverts are displayed alongside and above natural search engine results. Then each time a user clicks on the adverts’ link, the advertiser pays an agreed sum to Google (“pay per click”).

This service is disliked by many businesses as it increases their advertising costs to ensure that adverts for their own goods and services appear before their competitors. Trade mark owners believe that the advertisers should be prevented from buying their trade marks as keywords and Google should control and stop the exploitation of their trade marks. The European Court of Justice (ECJ) has recently given guidance on this issue.

The ECJ ruled that Google does not infringe the owner’s trade marks simply by selling those trade marks as keywords to third parties, nor does it do so simply by displaying third party advertisers’ adverts when an internet user searches the trade mark owner’s trade mark as a keyword.

However, an advertiser infringes the owner’s trade marks if its advert, displayed when an internet user searches keywords identical or similar to the trade marks, does not allow an average user (or enables that user only with difficulty) to determine whether the goods or services referred to come from the owner of the trade mark, or a business economically linked to it or come from a third party.

Once Google is aware that an advertiser’s advert is infringing a trade mark owner’s trade marks, it must act quickly to remove or disable access to the infringing advert. Otherwise it may be held liable as well.

In light of this ruling, trade mark owners should discover if and how their competitors are using their trade marks and take appropriate action. Advertisers who have bought their competitors’ trade marks as keywords should consider stopping advertising in this way or carefully review their adverts to minimise the risk of a claim for trade mark infringement.

Barry Riley
DDI – 0117 9453 042


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