30
Oct 2013

Keyword advertising on the internet – German Federal Court of Justice (BGH) rules again

When an internet user performs a search on the basis of one or more words on the Google search engine, that search engine will display the sites which appear best to correspond to those words, in decreasing order of relevance. These are referred to as the 'natural' results of the search. In addition, Google's paid referencing service - "AdWords" - enables any economic operator, by means of the selection of one or more keywords, to obtain the placing, in the event of a correspondence between one or more of those words and that/those entered as a request in the search engine by an internet user, of an advertising link to its website. That advertising link appears under the heading "sponsored links", which is displayed either on the right-hand side of the screen, to the right of the natural results, or on the upper part of the screen, above the natural results.

That form of advertising often brings proceedings for trade mark infringement before the German and European Courts.  The German Federal Court has held that the use of a trademark as am Adword could constitute trademark infringement. Even if the trademark itself is not displayed there can be a trademark use, if the advertising is not clearly separated from the search results and does not either contain the competitor's trademark or a note regarding the competitor or its products. Now the BGH concerns the assessment of trademark infringement by using a trade mark which has a reputation as keyword of an Adword advertisement (Dec. only available in German).

The court considers, that booking a sign that is identical to a trademark which has a reputation to trigger advertisements for similar products or services does not violate trademark law as long as the text of the advertisement does not contain the trademark and the display URL points to a third-party website. Thus, when the use, as a keyword, of a sign corresponding to a trade mark with a reputation triggers the display of an advertisement which enables the reasonably well-informed and reasonably observant internet user to tell that the goods or services offered originate not from the proprietor of the trade mark but, on the contrary, from a competitor of that proprietor, the conclusion will have to be that the trade mark's distinctiveness has not been reduced by that use, the latter having merely served to draw the internet user's attention to the existence of an alternative product or service to that of the proprietor of the trade mark.

As it is apparent that the fact that a trade mark enjoys a reputation makes it likely that a large number of internet users will use the name of that mark as a keyword when carrying out an internet search to find information or offers relating to the goods or services covered by that trade mark, it might be possible that the advertiser rides on the coat-tails of a trade mark with a reputation in order to benefit from its power of attraction, its reputation and its prestige, and to exploit, without paying any financial compensation and without being required to make efforts of its own in that regard, the marketing effort expended by the proprietor of that mark in order to create and maintain the image of that mark. If that is the case, the advantage thus obtained by the third party must be considered to be unfair. The Court states, that is particularly likely to be the conclusion in cases in which internet advertisers offer for sale, by means of the selection of keywords corresponding to trade marks with a reputation, goods which are imitations of the goods of the proprietor of those marks. By contrast, where the advertisement displayed on the internet on the basis of a keyword corresponding to a trade mark with a reputation puts forward - without offering a mere imitation of the goods or services of the proprietor of that trade mark, without causing dilution or tarnishment and without, moreover, adversely affecting the functions of the trade mark concerned - an alternative to the goods or services of the proprietor of the trade mark with a reputation, it must be concluded that such use is permitted.

Dr. Robert Kazemi

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