Supreme Court rules in favour of Google in keyword case
Legal updates: case law analysis and intelligence
Following a decision of the Court of Justice of the European Union (ECJ) issued in March of this year, the French Supreme Court has ruled, in four decisions, that Google’s AdWords system did not infringe the plaintiffs' trademarks (July 13 2010).
The four cases at issue opposed Google to Louis Vuitton, CNRRH, GIFAM and Viaticum. The AdWords system allows advertisers to purchase third-party trademarks as keywords to trigger sponsored links in search results.
In two decisions issued in 2005 and 2006 (CNRRH v Google and Viaticum v Google), the Versailles Court of Appeal had held that Google was guilty of trademark infringement and unfair competition. In 2006 and 2008 the Paris Court of Appeal had found Google guilty on the same grounds in Louis Vuitton v Google and Gifam v Google. Google appealed to the Supreme Court.
In 2008 the Supreme Court referred questions on the liability of referencing service providers to the ECJ for a preliminary ruling (for further details please see "Supreme Court refers questions on keying to ECJ" and "More questions referred to the ECJ in Google Cases").
On March 23 2010 the ECJ held as follows:
- A referencing service provider which stores signs identical to registered trademarks as keywords, and displays advertisements on the basis of those signs, does not use the marks within the meaning of Articles 5(1) and (2) of the First Trademarks Directive (89/104/EEC) or Article 9(1) of the Community Trademark Regulation (40/94).
- A referencing service provider can be held liable for trademark infringement only if it has played an active role of such a kind as to give it knowledge of, or control over, the data stored (for further details please see "Google's use of trademarks as keywords does not constitute infringement").
The Supreme Court, based on the ECJ's decision, concluded that Google did not infringe the plaintiffs' trademarks by selling keywords and displaying advertisements. However, the Supreme Court confirmed the ECJ's finding that a trademark owner is entitled to prohibit advertisers from advertising, on the basis of a keyword identical, or similar to, a registered trademark, goods or services identical to those for which that mark is registered.
The decisions will make it more difficult for trademarks owners to enforce their rights, as they will have to file suit against any advertiser. The decisions also confirm that Google will be held liable only if it was aware of the illegal character of the data stored and failed to take action. The decisions follow a general trend whereby the courts have found that service providers, such as eBay, were not liable for trademark infringement.
The issue of whether Google could be held liable for suggesting keywords to advertisers remains open.
Jean-Philippe Bresson and Séverine FITOUSSI, INLEX IP EXPERTISE, Paris
Copyright © Law Business ResearchCompany Number: 03281866 VAT: GB 160 7529 10