Landmark trademark infringement ruling over search engine keyword
Companies which purchase a rival’s trademark as a search engine keyword could be committing a trademark infringement, the European Court of Justice (ECJ) has ruled.
Interflora brought legal action against Marks & Spencer for buying “Interflora” as a Google AdWord thereby ensuring a link to Marks & Spencer’s online flower shop appeared every time an internet user searched for “Interflora” on Google.
The ECJ ruled in favour of the trademark proprietor in its judgment last week, Interflora v Marks & Spencer: C-323/09.
It held that the trademark proprietor can prevent the use of the AdWord “if the advertisement does not enable reasonably well-informed and reasonably observant internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the advertisement originate from the proprietor of the trademark or an undertaking economically connected to it or, on the contrary, originate from a third party”.
It further found that, depending on the referring court’s assessment of the facts, if the advertising led internet users to believe that Marks & Spencer’s flower-delivery service was part of Interflora’s commercial network then the trademark would be infringed since the function of the trademark would be “adversely affected”.
According to Pinsent Masons, which acted for Interflora: “The court held, for the first time, that use of a competitor’s trademark in the AdWords system can be unlawful where the use substantially interferes with a brand’s reputation and its ability to attract and retain consumers.
“As a result, brand bidding on competitors’ trademarks now carries more legal risk. The court also ruled that such use may also constitute free-riding (or taking unfair advantage) of a brand where that brand has established a reputation.”
Pinsent Masons partner Iain Connor says: “This is a significant ruling, and will have wide-reaching effects, in particular for the many companies that currently use rivals’ trademarks online in order to advertise their own businesses.”
The case will now revert to the High Court for determination on the facts.
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