EU trademark ruling to hurt brand owners

Steve Dinneen
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JUST hours after its acrimonious exit from China, Google won a landmark ruling that allows it to continue selling search terms such as “fake Louis Vuitton”.

A number of firms had hoped a decision from the European Court of Justice (ECJ) would stop the web giant from selling its trademarks to firms they say are cashing in on their brands.

Google makes a significant proportion of its £16bn advertising revenue through its AdWords software, which allows firms to purchase key search terms. Louis Vuitton, among others, had argued that boot-leggers are snapping up search terms to sell fake goods.

The court said individual advertisers who buy the terms will be liable for trademark infringement and brands will have to sue them directly.

A Google spokesman welcomed the verdict, saying it was a victory for freedom of information. He said: “This case is not about us arguing for a right to advertise counterfeit goods. We work collaboratively with brand owners to better identify and deal with counterfeiters. Some companies want to limit choice for users by... controlling and restricting the amount of information that users may see.”

The court confirmed Google has not infringed trade mark law by allowing advertisers to bid for keywords corresponding to their competitors’ trade marks. This is important because it is a fundamental principle behind the free flow of information over the internet.

Linklaters partner Marianne Schaffner, said: “Today’s ruling by the European Court of Justice is likely to make life more difficult for brand owners. It means they will have to sue all the advertisers using keywords, which is likely to lead to a multiplication of cases.”

AdWords adverts appear to the right of a regular Google search and can generate huge numbers of clicks.

Many brands spend vast amounts of money buying up “rogue” search terms to stop them falling into the hands of bootleggers.