Metatag use of trademark is not infringement, court rules

The Higher Regional Court of Dusseldorf has ruled that the use of another party's trademark in metatags neither infringes that party's trademark rights nor violates unfair competition law (20 U 104/03, February 17 2004).

K* & Z*, a seller of air guns, filed a complaint for trademark infringement and unfair competition when it discovered that a competitor was using its K* & Z* trademark and trade name in its website's metatags. During the proceedings, the defendant submitted a declaration of cease and desist, undertaking to stop all use of the mark. The Higher Regional Court of Dusseldorf therefore only had to decide whether K*& Z*'s claim was valid to determine which party should bear the costs of the case.

The court held that the defendant's use was non-infringing and thus K* & Z* had to pay the costs. The court reasoned that the defendant did not use K* & Z* as a trademark in the sense of Sections 14 and 15 of the German Trademark Act (ie, as a sign indicating the origin of the goods). The court pointed out that metatags are not:

• visible to internet users: they appear in the code of the website and are only read by search engines;
  
  
• capable of characterizing either the company that is using them, or the goods and services sold by that company; and
  
  
• exclusive to a specific website and therefore are not perceived by the public as an indication of origin, unlike domain names.

The court also held that the use of K* & Z* in metatags is unlikely either (i) to divert potential customers away from the K* & Z* website, or (ii) to mislead search engine users. The court added that search engine users will not be misled because they do not expect to find only websites relating to K* & Z* in the search results. Web users know that searches produce a multitude of more or less useful results. They only expect to find the term searched for in the content of the listed websites, rather than in the underlying code. The court went further to state that the practice of using trademarks in metatags to attract new customers is only an unfair or deceptive diversion if the competitor uses the mark in such a way that its website is listed before that of the mark owner on a search result page.

This ruling, which could also extend to cover keyword advertising, is in line with a previous decision of the Higher Regional Court of Dusseldorf (20 U 21/03, July 15 2003). Earlier decisions by other German courts, however, found that use of another party's mark in metatags constitutes trademark infringement (eg, Higher Regional Court of Munich, 6 U 4123/99, April 6 2000 and Higher Regional Court of Karlsruhe 6 U 112/03, October 22 2003). It is hoped that the German Federal Supreme Court will be able to resolve this conflict in the near future.

Friederike Bahr, Beiten Burkhardt, Munich