Google Ogles More Permissive Ad Policy

The announcement in April by Google to revisit its Adwords trademark policy has already resulted in trademark litigation against the search engine giant in several countries. The decision by Google to allow third-party advertisers to purchase the rights to any keyword, even if those keywords are trademarks held by another, has become a hot topic for brand owners fearful of the potential business consequences.

Previously, Google would not allow these third parties to purchase trademarked keywords unless they had permission from the trademark owner. A trademark owner, such as Acme Company, could prevent others from buying the term “Acme” and being highly ranked on Google's “Sponsored Links” list ' a list along the right hand of its search results page. Under Google's new policy, advertisers are allowed to purchase “Acme” or other trademarked names, as long as the advertisement text presented in the “Sponsored Links” area does not confuse consumers.

In late April, AXA, one of the world's largest insurance companies, commenced an action in Paris against Google for sale of the AXA trademark in Google's Adwords service. Another insurance company, Geico, as well as a German company, Metaspinner Media, have also brought litigation against Google for sale of trademarks. These cases have yet to yield any significant rulings.

Everything Is for Sale

Even before the change in policy, Google had been selling trademarked terms or phrases in certain circumstances. For example, if Google believed that even a registered trademark was descriptive or generic, Google would permit sale of the term or phrase. This is the scenario at issue in the pending American Blind & Wallpaper litigation with Google, in which American Blind is seeking injunctive relief to preclude Google from selling trademark terms as well as some other terms which the company believes should be exclusive to it under common law and unfair competition rights. This case is still in the preliminary stages.

In a related situation, Netscape and Excite recently lost an appeal in a case brought by Playboy in California for selling the trademarked terms “playboy” and “playmate.” This case settled after the appeal, but the court found that there is a cause of action for the sale of trademarked keywords.

The new, clearer Google policy however, has, and will, result in more litigation for the company ' an odd thing in view of its much anticipated initial public offering. Google's strategy requires that the company take the position that the reality of the marketplace ' the way people use the Internet and understand the Google site ' will not result in confusion of any degree.

Also, Google's change in policy only applies to United States and Canadian registrations. Google will still remove trademarks registered in other countries from their keyword searches. Therefore, if registrations exist in any countries outside of the U.S. or Canada, Google is supposed to remove those words from its keyword buy list if sent the proper complaint.

Google also states that it will still remove or force companies to modify advertisement text in its “Sponsored Links” section if the text is likely to cause consumer confusion. In other words, if an advertiser/competitor of Acme Company purchases “Acme” as a keyword, and then posts information stating that, “We are the Acme Company,” Google will remove the listing or have the ad text modified at the demand of the trademark owner. As a practical matter, though, the change in policy makes Google's decision process much easier ' everything is for sale.

Not all of the search engines that provide for the sale of keyword terms have embraced the more aggressive position of Google. Overture, which runs Yahoo!'s search engine, has not changed its policy. Success of litigation by Google, however, may change Overture's tune.

A stumbling block for Google will likely be forum shopping. With trademark law varying from country to country, and even within different regions of the same country, it is likely that as decisions favorable to the brand owners are issued, more cases against Google will be brought in those jurisdictions. Any consistent holding on the Google policy is unlikely, or many years away at best.

Confuse-A-User

The primary argument for trademark owners is the initial interest confusion test. This provides that even a small, brief amount of confusion is enough to provide the purchaser of the keyword an advantage from association with the brand. On the other hand, Google will likely argue that its page ' as well as the expectation of the search engine user ' will not result in any confusion. In particular, Google will in part argue that visitors to the site will not expect that there must be a link between the trademark owner and the third-party advertiser.

Finally, like any trademark analysis, many of the standard likelihood of confusion factors will be considered. These factors are viewed in the context of the Internet and the way it is used by consumers. For example, is there less harm if the term sold by Google is not for a product typically sold on the Internet? In addition, since the Internet is a source for so much information and there are banner and link ads all over Web site pages, would the public be surprised to see another “advertisement” displayed when conducting a search?

As these cases begin to unfold, more questions will likely arise. If Google is successful to any degree, we will see more challenges to brand owners through other avenues such as pop-up advertising and bulk e-mail. In the interim, though, as Google sells more and more trademarks, its litigation docket will rapidly expand throughout the summer.

The announcement in April by Google to revisit its Adwords trademark policy has already resulted in trademark litigation against the search engine giant in several countries. The decision by Google to allow third-party advertisers to purchase the rights to any keyword, even if those keywords are trademarks held by another, has become a hot topic for brand owners fearful of the potential business consequences.

Previously, Google would not allow these third parties to purchase trademarked keywords unless they had permission from the trademark owner. A trademark owner, such as Acme Company, could prevent others from buying the term “Acme” and being highly ranked on Google's “Sponsored Links” list ' a list along the right hand of its search results page. Under Google's new policy, advertisers are allowed to purchase “Acme” or other trademarked names, as long as the advertisement text presented in the “Sponsored Links” area does not confuse consumers.

In late April, AXA, one of the world's largest insurance companies, commenced an action in Paris against Google for sale of the AXA trademark in Google's Adwords service. Another insurance company, Geico, as well as a German company, Metaspinner Media, have also brought litigation against Google for sale of trademarks. These cases have yet to yield any significant rulings.

Everything Is for Sale

Even before the change in policy, Google had been selling trademarked terms or phrases in certain circumstances. For example, if Google believed that even a registered trademark was descriptive or generic, Google would permit sale of the term or phrase. This is the scenario at issue in the pending American Blind & Wallpaper litigation with Google, in which American Blind is seeking injunctive relief to preclude Google from selling trademark terms as well as some other terms which the company believes should be exclusive to it under common law and unfair competition rights. This case is still in the preliminary stages.

In a related situation, Netscape and Excite recently lost an appeal in a case brought by Playboy in California for selling the trademarked terms “playboy” and “playmate.” This case settled after the appeal, but the court found that there is a cause of action for the sale of trademarked keywords.

The new, clearer Google policy however, has, and will, result in more litigation for the company ' an odd thing in view of its much anticipated initial public offering. Google's strategy requires that the company take the position that the reality of the marketplace ' the way people use the Internet and understand the Google site ' will not result in confusion of any degree.

Also, Google's change in policy only applies to United States and Canadian registrations. Google will still remove trademarks registered in other countries from their keyword searches. Therefore, if registrations exist in any countries outside of the U.S. or Canada, Google is supposed to remove those words from its keyword buy list if sent the proper complaint.

Google also states that it will still remove or force companies to modify advertisement text in its “Sponsored Links” section if the text is likely to cause consumer confusion. In other words, if an advertiser/competitor of Acme Company purchases “Acme” as a keyword, and then posts information stating that, “We are the Acme Company,” Google will remove the listing or have the ad text modified at the demand of the trademark owner. As a practical matter, though, the change in policy makes Google's decision process much easier ' everything is for sale.

Not all of the search engines that provide for the sale of keyword terms have embraced the more aggressive position of Google. Overture, which runs Yahoo!'s search engine, has not changed its policy. Success of litigation by Google, however, may change Overture's tune.

A stumbling block for Google will likely be forum shopping. With trademark law varying from country to country, and even within different regions of the same country, it is likely that as decisions favorable to the brand owners are issued, more cases against Google will be brought in those jurisdictions. Any consistent holding on the Google policy is unlikely, or many years away at best.

Confuse-A-User

The primary argument for trademark owners is the initial interest confusion test. This provides that even a small, brief amount of confusion is enough to provide the purchaser of the keyword an advantage from association with the brand. On the other hand, Google will likely argue that its page ' as well as the expectation of the search engine user ' will not result in any confusion. In particular, Google will in part argue that visitors to the site will not expect that there must be a link between the trademark owner and the third-party advertiser.

Finally, like any trademark analysis, many of the standard likelihood of confusion factors will be considered. These factors are viewed in the context of the Internet and the way it is used by consumers. For example, is there less harm if the term sold by Google is not for a product typically sold on the Internet? In addition, since the Internet is a source for so much information and there are banner and link ads all over Web site pages, would the public be surprised to see another “advertisement” displayed when conducting a search?

As these cases begin to unfold, more questions will likely arise. If Google is successful to any degree, we will see more challenges to brand owners through other avenues such as pop-up advertising and bulk e-mail. In the interim, though, as Google sells more and more trademarks, its litigation docket will rapidly expand throughout the summer.