Key Words: Top at Any Cost

November 21, 2010

Following on from the Louis Vuitton case, the European Court of Justice (“ECJ”) has issued further guidance on the use of competitor’s trade marks as keywords in the recent case of Portakabin Ltd and another v Primakabin BV.

The judgement has clarified that although it is possible to use a third party’s trade mark as a keyword (or AdWord with Google), it is critical that the advertiser makes it clear that it is not associated with the third party.

Portakabin is the owner of the PORTAKABIN trade mark. It manufactures and sells module buildings.

Primakabin is in the business of selling and leasing new and second-hand mobile buildings, including those manufactured by Portakabin. As part of its marketing strategy Primakabin selected “portakabin” and common misspellings “portacabin”, “portokabin” and “portocabin” as Google AdWords. Primakabin’s advertisement in response to its selected AdWords was headed “used portakabins”.

AdWords

Google operates a paid-for keywords service called “AdWords”.  This allows sponsored links or advertisements to be displayed alongside natural search results.  Google allows advertisers to select and pay for or bid on keywords so that their advertisements are displayed in response to a search for the selected key words. The question then arises - if an advertiser selects a competitor’s trade mark as an AdWord, is this infringement of the competitor’s trade mark?

Trade Marks Directive

A registered trade mark owner has certain protections under the Trade Marks Directive. It can prevent a third party from using its trade mark for the same goods and services for which its trade mark is registered, or from using an identical or similar sign for identical or similar goods to those which the trade mark is registered, where it would lead to a likelihood of confusion.
Portakabin brought an action against Primakabin on the basis of the “portakabin” AdWords selected by Primakabin and the use of “used portakabins” in the advertisement, which was referred to the ECJ.

Infringement

The ECJ held that purchasing a third party’s trade mark as a keyword would not necessarily infringe that third party’s trade mark. It will only constitute trade mark infringement if the advertising does not enable the average user of the internet, or only enables them with difficulty, to ascertain whether the goods and services referred to originate from the owner of the trade mark or an economically linked entity or a third party.

A trade mark owner can not prevent a third party from using its trade mark in relation to goods put on the market in the EEA by the trade mark owner, or with its consent, unless there are legitimate reasons. This means that use of a keyword in respect of these sales will not be considered as infringing the trade mark, unless there is a legitimate reason for the trade mark owner to oppose the advertising, such as the advertising causes some serious detriment to the trade mark’s reputation. 
In particular, the ECJ noted that an advertiser using the trade mark in combination with wording such as “used” or “second-hand” would not be sufficient to demonstrate serious detriment to the trade mark’s reputation or suggest an economic link between the parties.

Top at any cost?

Those using third party’s trade marks as keywords should take care to ensure it is clear that they are separate entities from the trade mark owner. Whilst to claim a link is obvious infringement, to be vague is to play a dangerous game. If the advertisement is vague to such an extent that the average user can not determine the origin of the goods on the basis of the advertising link and commercial message, this will infringe the third party’s trade mark. Legal advice should be taken as appropriate.
Brand owners should consider monitoring the use of their trade marks through conducting searches for keywords. Deliberate misuse of the trade mark should be reported to Google (or the relevant search engine provider) and legal action should be considered.

For further guidance or information please contact the Ebizlaw team.


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