Google’s use of its AdWords tool cannot in itself amount to trade mark infringement. So considered Advocate-General Poiares Maduro, assistant to the European Court of Justice, in an opinion delivered on 22 September 2009 following a reference to the Court by the French Cour de Cassation (Joined Cases C-236,7,8/08, Google France and ors v Louis Vuitton Malletier and ors). The Court usually—although not always—follows the Advocate-General’s opinion, which is thus a strong indication of the way in which the Court will finally rule.
Google (along with other search engine providers) supplies a keyword sponsorship product (in Google’s case, AdWords) which enables advertisements to be displayed, alongside ‘natural’ results, in response to designated inputted keywords. Advertisers select keywords so that their ads are displayed in response to the input of those keywords and pay Google on the basis of the frequency with which users click on the ads’ links. A number of trade mark owners, including Louis Vuitton, sued Google France for trade mark infringement in France on the basis of the use of their marks as sponsored keywords.
The Advocate-General drew a clear distinction between the use as such in AdWords of keywords corresponding to trade marks and the use of trade marks in advertisers’ sites or the products sold on those sites; the reference concerned only the legality of the former; the legality of the latter forms of use could only be assessed on their own terms. The Advocate-General broke keyword use down into two elements: (a) the offer by Google to advertisers of keywords to sponsor and (b) the display of ads in response to the input of keywords. He found no infringement in relation to (a) since the use of the trade marks as keywords was not made in relation to the goods for which the trade marks were registered, for example, leather goods, but in relation to Google’s own AdWords service. He also found no infringement under (b) on the basis that searchers were unlikely to be confused into thinking that the results of a search inputting a particular trade mark necessarily linked to the trade mark owner (or an economically related undertaking). In addition, the selection by advertisers of keywords to sponsor could not amount to infringement since in this context the advertisers were acting privately as consumers and not in the course of trade.
The Advocate-General’s analysis under (b) appears to be deficient: it is not necessary to demonstrate a likelihood of confusion when seeking to establish infringement on the basis of use of an identical mark in relation to identical goods and services, for example, where a link to a leather goods retailer is displayed following the input of, say, Louis Vuitton as a search term. The question that the Advocate-General arguably had in mind was whether the display of ads in response to the input of keywords was liable to affect the functions of the trade mark, in particular, whether it would be interpreted by consumers as a designation of origin of the goods covered by the mark and thus infringing. By including the need to show a likelihood of confusion as part of the test, the Advocate-General may have set too high a bar for trade mark owners when seeking to establish infringement.
In the context of the additional protection conferred by trade mark law on marks with reputation, such as the Louis Vuitton mark, the Advocate-General adopted a broad approach and considered that Google’s use of such marks as keywords could not be prevented, as the need for freedom of expression and commerce outweighed the need to protect the investment that goes into such marks. If followed by the Court, this balancing exercise would likely represent a development of the law in the trade mark sphere.
Unsurprisingly, the Advocate-General rejected the suggestion that Google could be liable for contributing to infringing acts by third party websites whose links were displayed in response to inputted keywords; questions of joint liability are not addressed by EU legislation and fall to be determined as a matter of national law.
Finally, the Advocate-General opined that if Google were found liable for infringement, it would not be able to rely on the E-Commerce Directive (2000/31/EC) to exempt it from such liability. Although he considered Google’s search engine and provision of hyperlinks under AdWords to be covered by the Directive (as information society services), its activities could not be described as mere hosting and thus susceptible to exemption, since it did not remain neutral in its operation of AdWords; it retained an interest in users clicking on links to the ads.
While the opinion may not on the whole be favourable to brand owners, it still raises a number of questions for the Court to consider. Moreover, since the rules on joint liability fall to be decided on a national basis, it may be unrealistic to expect courts across the EU to be consistent in their decisions on liability of search engine providers in this area, in the short term at least.
Marianne Schaffner, Partner, Paris on (33) 1 56 43 59 60 (marianne.schaffner@linklaters.com)
Lorraine Sautter, Associate, Paris on (33) 1 56 43 59 31 (lorraine.sautter@linklaters.com)
