I. Introduction
Google, as the most widely used internet search engine, also has great importance in internet advertising due to its existing top position in the search engine sector. Many companies therefore invest money in advertising on Google. Here, the advertiser has to create an ad on Google and select certain keywords for his ad. These are words and groups of words that are supposed to refer to one's own advertising offer and one's own company/product. When booking an AdWords ad with Google, the advertiser can specify the keywords that are to appear in the AdWords ad when they are entered in the Google search mask. In addition, there is the option that the booked AdWords ad will also appear when corresponding or largely matching keywords are entered in the Google search mask. If an Internet user now enters one of the predefined or largely matching keywords in the Google search mask, the advertiser's AdWords ad appears separately from the non-commercial search results in a separate column area. These advertisements are identified with the heading "Ads".
II. the problem
The problem with Google AdWords ads is that companies often use the company and brand names of competing companies as keywords. This in turn leads to the fact that when a search term is entered (e.g. company A is searched for and entered in the search mask), company B suddenly appears in the Google search results with a Google ad, although another company was searched for and entered. However, since Google advertisements always appear before the "normal" search results and are clearly highlighted, a company can achieve by specifying certain keywords that when a certain search term is entered, e.g. a certain company or a certain product, its own company and its own products always appear as advertisements.
Numerous companies are therefore trying to get the courts to prohibit competing companies from using other companies' and brand names in Google ads. In this context, the question of whether an advertiser may also specify keywords in his AdWords ad that are protected under trademark law was very controversial.
III. Jurisdiction of the Federal Supreme Court
The BGH has dealt with this issue in three fundamental decisions.
1. Bananabay
The Bananabay case dealt with the question of whether the use of a protected designation as a keyword in an AdWords ad constitutes trademark use within the meaning of the Trademark Act.
The defendant, a provider of erotic articles, had specified the term "Bananabay" as the keyword of its AdWords ad. However, "Bananabay" is protected as a trade mark for the plaintiff, who also sells erotic articles on the internet under this name. The defendant therefore used a keyword identical to another person's trade mark in an identical field of goods and services.
Since the provisions of German law are based on harmonised European law, the Federal Court of Justice stayed the proceedings and referred this question to the European Court of Justice for a preliminary ruling under Article 234 of the EC Treaty (now Article 267 TFEU).
Order of the BGH of 22 January 2009 - I ZR 125/07 - Bananabay
Lower courts:
Regional Court of Braunschweig - Judgment of 7 March 2007 - 9 O 2382/06
OLG Braunschweig - Judgment of 12 July 2007 - 2 U 24/07 - MMR 2007, 789
2. pcb
In the pcb decision, two companies that offer printed circuit boards via the internet faced each other. For the plaintiff, the trade mark "PCB-POOL" is protected. The defendant had specified "pcb" as a keyword in its AdWords ad and had also booked the option "largely matching keywords". In professional circles, the letters "pcb" are an abbreviation for "printed circuit board". Due to the option "largely matching keywords", when the term "PCB-POOL" was entered in the Google search mask, an AdWords ad for the defendant's products appeared in the separate ad block next to the hit list.
In this case, the Federal Supreme Court classified the defendant's actions as lawful and dismissed the action, setting aside the appeal judgment. According to the Federal Supreme Court, the trade mark proprietor cannot, as a rule, prohibit the use of a descriptive indication (in this case "pcb") even if it is used as a trade mark, thereby creating a likelihood of confusion with the protected trade mark. In this case, the Federal Supreme Court assumed a descriptive use permitted under trade mark law. Since a trademark infringement was to be denied for this reason alone, the legal question submitted to the European Court of Justice in the Bananabay proceedings was no longer relevant.
Judgment of the Federal Supreme Court of 22 January 2009 - I ZR 139/07 - pcb
Lower courts:
Stuttgart Regional Court - Judgment of 13 March 2007 - 41 O 189/06
Stuttgart Higher Regional Court - Judgment of 9 August 2007 - 2 U 23/07 - WRP 2007, 649
3. Beta layout
In the Beta Layout decision, the defendant had entered the name "Beta Layout" as a keyword on Google. The plaintiff and competitor of the defendant uses the company name "Beta Layout GmbH". In this case, too, whenever an internet user entered "Beta Layout" as a search term on Google, an ad block with an advertisement for the competitor's products appeared next to the hit list.
Here, too, the Federal Court of Justice denied the infringement of a company name and a corresponding claim for injunctive relief, reasoning that the risk of infringement required for the infringement of a company name was lacking. The average internet user would not assume that the AdWords ad appearing in the separate ad block next to the hit list and marked as such originated from Beta Layout GmbH.
As the protection of company names, unlike trade mark protection, is not based on harmonised European law, a referral to the European Court of Justice was out of the question in these proceedings.
Judgment of the Federal Court of Justice of 22 January 2009 - I ZR 30/07 - Beta Layout
Lower courts:
Düsseldorf Regional Court - Judgment of 7 April 2006 - 34 O 179/05
Düsseldorf Higher Regional Court - Judgment of 23 January 2007 - 20 U 79/06 - WRP 2007, 440
IV. Case law of the European Court of Justice (ECJ)
1. In which cases does the ECJ rule and what are the implications of these decisions for national courts?
Art. 267 TFEU (Treaty on the Functioning of the European Union) stipulates that the European Court of Justice shall decide on questions of interpretation of European law by way of a so-called preliminary ruling upon a referral or appeal from the court of a Member State. Insofar as the courts of the Member States have final jurisdiction, such as the Federal Court of Justice in the Bananabay proceedings, they are even obliged to submit questions of interpretation to the ECJ. Pending a decision by the ECJ, the proceedings before the respective national courts are suspended.
The purpose of the preliminary ruling procedure is to ensure that European law is applied uniformly in all member states. To ensure this, the decisions of the ECJ are binding on the courts of the member states.
In the Bananabay case, the Federal Court of Justice had to refer the case to the ECJ because it involved questions of interpretation of European law. Although the case primarily concerned the infringement of German trade mark law, German trade mark law is harmonised EU law, as the German national regulations are based on a European directive; they are uniform in all member states.
2. Google and Google France
In a total of three Google France cases, the ECJ had to deal with the liability of the search engine operator following a referral from the French Cour de Cassation and with the fundamental question of whether and to what extent the Google AdWords advertising programme infringes the trademark rights of third parties. The essential statements in brief:
a) The trade mark proprietor may in principle prohibit an advertiser from advertising identical goods or services on a keyword identical with that trade mark. However, this only applies if the design of the AdWords ad does not allow the average internet user to recognise whether the advertised goods or services originate from the trade mark proprietor or from a third party and therefore there is a risk of false attribution (confusion of attribution must occur).
b) The mere creation of the technical conditions for this type of internet advertising does not constitute an infringement of the trade mark proprietor's rights and does not give rise to any liability on the part of Google.
c) Liability of the search engine operator can only be considered if, after becoming aware of a trademark infringement, the objectionable ad content is not immediately removed by Google or access to it is blocked.
ECJ, Judgment of 23.03.2010 - Cases C-236/08, C-237/08, C-238/09 (Google and Google France)
3. BergSpechte
The BergSpechte case was referred to the ECJ by the Austrian Supreme Court (OGH).
In its decision, the ECJ confirms its statements from the Google proceedings and clarifies that the trademark owner may prohibit an advertiser from advertising identical goods or services on the basis of a keyword that is identical or similar to its trademark. This should apply at least if the average internet user is led to believe that there is an economic connection between the trade mark owner and a third party through this advertising.
ECJ, Judgment of 25.03.2010 - Case C-278/08 (BergSpechte)
4. Bananabay
As the questions submitted by the Federal Court of Justice in the Bananabay proceedings were, in the ECJ's view, largely identical in content to the submission in the Google proceedings, the ECJ referred by order to the reasoning in the Google France case.
As a result, this means that in cases where the average internet user cannot clearly recognise that the advertised goods and services do not originate from the trade mark owner but from a third party, there is a trade mark infringement and the trade mark owner has the possibility to prohibit the advertiser from advertising with this keyword, which is identical to the trade mark.
ECJ, Order of 26.03.2010 - Case C-91/09 (Bananabay)
5. Portakabin
Following a referral from the Dutch Hoge Raad, the ECJ dealt with the question of whether companies selling the trademark owner's products (so-called resellers) may use the trademark owner's trademark name as a keyword.
In its reasoning, the ECJ confirmed its comments on Google France and added specific statements on the resale of branded products:
a) A trade mark infringement exists if the reseller's advertisement gives the impression that there is an economic link between him and the trade mark proprietor.
b) There is no trade mark infringement if the reseller uses the trade mark with the addition of terms such as "used" or "second-hand".
(c) the trade mark right owner may not prohibit the reseller from offering goods of other trade marks on the linked internet pages, provided that they do not substantially disparage the image of the trade mark.
ECJ, Judgment of 08.07.2010 - Case C-558/08 (Portakabin)
6. Interflora
In the Interflora case, the High Court of Justice of England and Wales has asked the ECJ for a preliminary ruling.
This case is about reputation protection, i.e. the question under which conditions the owner of a well-known trademark can prohibit its targeted use as a keyword by an advertiser and protect himself from reputation exploitation.
A decision by the ECJ is still pending, but the Advocate General has already given his opinion. It should be noted, however, that the ECJ is not obliged to follow the opinion of the Advocate General. However, it has been shown in the past that the ECJ usually follows the opinions of the Advocates General.
In his opinion, the Advocate General stated:
a) The trade mark proprietor may prohibit the use of his trade mark as a keyword by an advertiser if the public is given the impression that the advertiser belongs to the trade mark proprietor's distribution network which is identified by the trade mark.
b) Exploitation of reputation requires that the well-known mark is mentioned or represented in an advertisement and that the well-known mark is either used there as a generic term for a category of goods or services or the advertiser tries to exploit the image of the well-known mark.
ECJ, Opinion of 24.03.2011 - Case C-323/09 (Interflora)
VI. conclusion
In summary, it can be stated that the advertiser can in principle use third-party trademarks as keywords. However, it must be made clear through the design of the advertisement that there is no economic connection with the trademark owner, otherwise a trademark infringement can be assumed. In addition, care must be taken that the advertisement is not so vague that an average internet user mistakenly attributes the advertisement to the trademark owner. Advertisers are therefore advised to place a clarifying notice in the advertisement text in order to exclude any risk of confusion.
When the confusion of attribution required for a trade mark infringement exists in a Google advertisement must be assessed separately in each individual case. Our lawyers will be happy to assist you with a legal review.
Goldberg Attorneys at Law 2011
through
Christine Thede, trainee lawyer
and
Michael Ullrich, LL.M. (Information Law)
Lawyer and
Specialist lawyer for information technology law
Tel: 0202-450036
Fax: 0202-450036
E-mail: info@goldberg.de
