Google Adwords Campaigns Can Support Trademark Infringement Litigation

Our internet lawyers are often asked about whether a competitors use of their trademarks in Google adwords campaigns can result in legal liability.  The answer is that, in some circumstances, use of a competitors trademarks in Google adword advertising is unlawful.  While this is a very young area of law with few reported decisions, the Australian Gold v. Hatfield, 436 F.3d 1228 (10th Cir. 2006) case makes it clear that legal counsel should be consulted before starting any adwords campaign using some else's trademarks and threat letters are appropriate by trademark owners. Eric Goldman over at the Eric Goldman blog has some fun with 1-800 Contacts Google Adwords litigation filed last week. 

For more information on Google Adwords Trademark Infringement, check out these links or keep reading this article below.

• Adwords Trademark Infringement Continues to be a Grow Into A Global Problem For Brand Owners.
• What is Google's AdWords and AdSense trademark policy? Google's policy is different in different countries. However, Google leaves it up to trademark owners and advertisers to sort out there differences in most cases. 

Technology & Marketing Law Blog: 1-800 Contacts Sues LensWorld for Keyword Advertising

In any case, the LensWorld lawsuit is a garden-variety advertiser-vs.-advertiser keyword advertising lawsuit. Based on the limited data we have, I'm guessing the Utah federal court will deem keyword advertising a trademark use in commerce, but after that, who knows? The only twist here is that 1-800 Contacts claims that LensWorld aped their FAQs, prompting a tossed-in copyright infringement claim as part of the package. Also I can't help but note that there appear to be many other possible defendants who are buying 1800contacts as a keyword (see the screenshot in para. 22/page 6)...is a 1-800 Contacts litigation frenzy imminent, or is LensWorld uniquely positioned for 1-800 Contacts' enmity?

Comments

[jack]

Can people register trademarks for something as simple as "emergency response team"?

[google adwords dispute attorney]

Do your attorneys handle google adwords disputes? My company has trademarks which are registered. Those trademark registered words are being used by a competitor in Google adwords advertising campaigns. Our customers are being diverted and are confused. They think they are going to our web site. Instead, they are directed by the Google ads to a competing web site.

[Winning On The Internet]

Personally, I think the best information you can have about Google Adwords is in the Definitive Guide to Google Adwords by Perry Marshall. He's kind of known in the internet marketing world as the "adwords guy". He's turned a lot of businesses around. It's amazing the easy things you miss when trying to setup an adwords campaign by yourself. His book really helped me get an edge on my competitors. http://www.winningontheinternet.com

[Trademarks search]

I'm very gratified with this blog that I have enjoyed enormously congratulations will be here always.

[Google Adwords Trademark Infringement]

Storus Corp. v. Aroa Marketing, Inc. (PDF)
2008 U.S. Dist. LEXIS 11698
Decided February 15, 2008
AdWords, Google

Storus sued Aroa Marketing and Skymall for trademark infringement. Storus sold money clips under the registered mark “Smart Money Clip.” The defendants challenged the validity of the mark, arguing the mark is merely descriptive, but offered no evidence to rebut the presumption of secondary meaning that attached to a registered trademark.

Storus argued initial interest confusion.

Initial interest confusion occurs when the defendant uses the plaintiff’s trademark in a manner calculated to capture initial consumer attention, even though no actual sale is finally completed as a result of the confusion.

Google AdWords, Aroa purchased “AdWords” from Google. One of the “AdWords” was “smart money clip.” If a user searched for “smart money clip,” an advertisement for Aroa would appear. The court explained that the three most important factors to look at in the context of the internet are “(1) the similarity of the marks, (2) the relatedness of the goods or services, and (3) the parties’ simultaneous use of the Web as a marketing channel.”

Judge Chesney found that Aroa offered no evidence to show a lack of initial interest confusion. Further, Aroa offered no explanation for why it chose Storus’ trademark as an “AdWord.” All three factors weighed in favor of plaintiff so Judge Chesney found initial interest confusion as a matter of law on Google AdWords and other activities.

Next, Storus’ claim against Skymall was analyzed. “Skymall’s website has a search engine that consumers can use to search the Skymall website.” Skymall sold Aroa money clips. If a user were to search for “smart money clip” on Skymall’s website, she would be directed to a page that offers Aroa’s money clip.

[I]t is Storus’ theory that when a consumer asks if Skymall offers a “Smart Money Clip,” Skymall answers, “yes,” and directs the consumer to a page offering an Aroa money clip.

Basically, the evidence offered at this stage was too imprecise to support summary judgment. Google AdWords can increase the possibility of consumer confusion, especially when it is part of other infringing activity.

[Initial Interst Trademark Confusion]

800-JR Cigar, Inc. v. GoTo.com, Inc., 437 F. Supp. 2d 273

Thus, courts have found that damage to a trademark holder results even where a consumer eventually becomes aware of the source's actual identity or where no actual sale occurs. See Australian Gold, Inc. v. Hatfield, 436 F.3d 1228, 1239 (10th Cir. 2006); BigStar Entm't Inc. v. Next Big Star, Inc., 105 F. Supp. 2d 185 (S.D.N.Y. 2000).

This damage can manifest itself in three ways: (1) the original diversion of the prospective customer's interest to a source that he or she erroneously believes is authorized; (2) the potential consequent effect of that diversion on the customer's ultimate decision whether to purchase caused by an erroneous impression that the two sources of a product may be associated; and (3) the initial credibility that the would -- be buyer may accord to the infringer's products -- customer consideration that otherwise may be unwarranted and that may be built on the strength of the protected mark, reputation and goodwill. Australian Gold, 436 F.3d at 1239.

[Actual Trademark Use Required]

Initial interest confusion or initial source confusion is a theory [*18] under which plaintiffs argue that defendants use the plaintiffs' trademarks in metatags or as keywords to improperly divert internet traffic to the defendants' websites. See Site Pro-1,2007 U.S. Dist. LEXIS 34107, at *14; see also Brookfield Communs., 174 F.3d at 1065 (holding there was initial interest confusion because defendant used plaintiff's trademark to divert people looking for plaintiff's website, thereby "improperly benefit[ting] from the goodwill that Brookfield developed in its mark") .

This Court takes note of AG's argument, but finds it is premature. While the Second Circuit has not ruled on trademark use in metatags and the search engine context, it has expressly rejected the initial interest confusion theory prior to a determination of trademark "use". See 1-800 Contacts, 414 F.3d at 412 (dismissing an argument of initial interest confusion because the plaintiff had not yet established "use" in the trademark sense). As mentioned above, "'use' must be decided as a threshold matter, because while any number of activities may be 'in commerce' or create a likelihood of confusion, no such activity is actionable under the Lanham Act absent the 'use' of a trademark." Id. (quoting [*19] 15 U.S.C § 1114).