Use of trademark as keyword does not constitute trademark infringement

The Frankfurt am Main Court of Appeal has held that use of a competitor's trademark as a keyword in an internet search engine does not amount to trademark infringement if the search result is clearly recognizable as an advertisement (Case 6 W17/08, February 26 2008).

Google's AdWords program allows advertisers to buy keywords that internet users are likely to enter as search terms. When a keyword is entered into the search engine, the advertisement appears in the sponsored links section and leads to the advertiser's homepage.

In the case at hand, the claimant, who markets fermented beverages under the designation A, is the licensee of the Community trademark A (the actual trademark was not cited in the decision of the court). The defendant also markets fermented beverages. The claimant sued the defendant for trademark infringement and unfair competition, alleging that the defendant used the trademark as a keyword in connection with the 'related keywords' search function.

The court dismissed the trademark infringement claim on the grounds that there was no trademark use. According to the court, a trademark may be infringed only if it is used by the defendant in a trademark sense - that is, it must be used in the course of trade in order to distinguish a company's products or services from those of another company. Since the defendant used the trademark only to present its own advertisements, there was no use in a trademark sense. Moreover, internet users were not led to believe that there was any connection between the claimant's trademark and the defendant's business, since the advertisement was positioned separately from the search results and was clearly recognizable as an advertisement.

The court emphasized that it departed from the case law of other German courts, which have treated metatags and keywords in the same manner. The court held that in contrast to the use of a trademark as a concealed search word (metatag), the use of a trademark as a keyword influences only the position of the search results, and not the search results as such.

The court also rejected the unfair competition claims. Since it was obvious that the advertisements did not originate from the claimant, internet users were not likely to believe that there was any connection between the defendant and the claimant's trademark. Therefore, the defendant did not exploit the claimant's reputation unlawfully in order to promote its own products.

Moreover, the court concluded that use of the claimant's trademark did not unfairly impede the claimant's sales by 'intercepting' potential customers, as the defendant did not influence the consumers' decision in buying certain products.

Finally, the court held that the defendant's actions were not in breach of the Unfair Commercial Practices Directive (2005/29/EC). Since the search results were recognizable as the defendant's advertisement, they did not mislead consumers within the meaning of Article 6(2)(a) of the directive.

Anna Sophie Steinmeister, Bardehle Pagenberg Dost Altenburg Geissler, Munich