Adwords and Trade Mark infringement

One particularly hot topic in intellectual property law at the moment concerns the use of adwords and trade mark infringement.

In March 2010, the European Court of Justice (ECJ) gave its judgment in Google France SARL v. Louis Viutton Malletier SA. That case concerned Google’s paid referencing service. This service allows an advertiser to ensure that when certain words – including competitors’ trade marks - are typed into Google as keywords, an advertisement for the advertiser’s goods or services appears. The Court ruled that merely by providing this facility, Google was not liable for trade mark infringement.

In Portakabin Ltd and another v Primakabin BV, the focus shifted to the advertiser. Portakabin made and supplied mobile buildings. It owned a Benelux trade mark for the word PORTAKABIN in relation to metal and non-metal buildings, parts and building materials. Primakabin sold and leased new and second-hand mobile buildings, some of which were made by Portakabin. The second-hand Portakabins were originally put on the market within the EEA with Portakabin's consent.

Primakabin chose the keywords "portakabin" and the misspellings "portacabin", "portokabin" and "portocabin" as Google Adwords. The sponsored advertisement generated when any of these keywords were typed into Google was initially headed "new and used units" but this was later changed to "used portakabins". Portakabin sought an interim injunction against Primakabin in the Dutch courts alleging trade mark infringement.

Eventually, a number of questions were referred to the ECJ. The rulings of the Court can be summarised as follows:
• The use of keywords does constitute "use" of a sign for trade mark purposes.

• Such use will infringe the trade mark unless it is made clear that the advertised goods or services do not emanate from the trade mark proprietor or any linked company.

• Where this is not clear, the advertiser will rarely have a defence under the rule which permits use of trade marks to indicate the characteristics of the goods, although it is open to national courts to find that such a defence exists on specific facts.

• On the other hand, an advertiser may use a trade mark as a keyword in relation to the sale of second-hand but genuine trade marked goods unless the trade marker owner has a legitimate reason to oppose the resale of its goods. Unusually, the ECJ provides some useful detailed guidance as to what might be a legitimate reason in this context:

a) The trade mark owner cannot object to the use merely because the advertiser has used the mark in combination with wording that indicates that the goods are used or second-hand.
b) The trade mark owner can object where the advertiser has removed the trade mark from genuine trade-marked goods and replaced it with a label bearing the advertiser 's own mark
c) The trade mark owner cannot object to the use of the trade mark in connection with the sale of second-hand goods alongside the sale of other second-hand goods unless those other sales (because of the volume, presentation or poor quality of the goods in question) risk seriously damaging the image of the proprietor's trade mark.

If you would like to know more about and the implications of the Portakabin case, please contact Nick Crook or Simon Daw.

Filed: 21/09/2010 10:41:34