An Indian Court Rules Against Google’s Trademark Keyword Practices
An Indian court has made a significant ruling, stating that Google can be held liable for allowing competitors to bid on a brand’s name as an advertising keyword. This decision challenges the traditional assumption in search advertising that platforms can auction off any term, including trademarked names, without direct liability.
The Ruling:
- Delhi High Court: In a judgment delivered on May 22, Justice Mini Pushkarna ruled against Google LLC and Google India, permanently restraining them from using the trademark "Hindware" as a keyword.
- Damages: The court ordered Google to pay ₹30 lakh (approximately $31,600) to Hindware Limited, an Indian sanitaryware manufacturer.
Background:
The dispute dates back to when Hindware discovered that competitors, such as Cera and Grohe, had bought keywords similar to "Hindware," leading to their brand being displayed alongside rival products in sponsored search results.
Google’s defense centered around the argument that they merely reserve keywords and are not responsible for how advertisers use them. However, the court found that Google actively suggests trademarked terms through its Keyword Planner tool and profits from these keyword auctions.
Key Findings:
- Using a Trademark as a Keyword: The court determined that using a trademarked term as a keyword amounts to "using it in advertising," even if the mark itself does not appear in the ad.
- Safe Harbor: Notably, the ruling challenges Google’s safe harbor under Section 79 of India’s IT Act, arguing that when platforms shape outcomes algorithmically, they forfeit this protection. The court also criticized Google for its policy of not investigating trademarked keywords as a failure of due diligence.
Implications:
- Industry Impact: This judgment could have far-reaching implications for the advertising industry, as keyword bidding on competitors’ brands is a common practice.
- Regulator Scrutiny: The decision comes at a time when regulators worldwide are examining Google’s ad business, including EU antitrust cases.
- Future Legal Challenges: While Google may appeal, the ruling sets a precedent that could influence legal battles related to algorithmic decision-making and content recommendation systems.