Advocate General advises European Court of Justice on use of a trademark as a keyword in Google AdWords

On March 24, 2011, one year after the Google France and Googledecision (see Newsletter 2/2009 p. 7), Advocate General Jääskinen issued his opinion in a new case also relating to keyword advertising on an Internet search engine.

The case at issue here arose after Marks & Spencer plc (“Marks & Spencer”) bought a paid referencing service through Google’s AdWords for various keywords containing the trademark “INTERFLORA” to trigger ads for its flower delivery service, identical to the well-known rival service offered by Interflora, Inc. (“Interflora”).

Served with a trademark infringement action by Interflora, the High Court of Justice of England and Wales (Chancery Division) referred no fewer than ten questions (which were then reduced to four) for preliminary rulings. Basically, the crux of the case raised the following two questions:

i.        Whether the reservation by a trader of one of his competitor’s trademarks to trigger advertising for his own benefit should be considered as a “use” “in relation to goods and services for which the trademark is registered” within the meaning of Article 5(1) of the Trademark Directive, and therefore could be prohibited by the trademark owner;

ii.        Whether such use, assuming it was detrimental to the distinctive character of the trademark or takes unfair advantage of its reputation, could be prohibited under Article 5(2) of the Trademark Directive (granting additional protection to trademarks that have a reputation).

On the first question, Advocate General Jääskinen, not surprisingly, reiterated the position held by the ECJ in Google France and Google, and confirmed that:

i.        The reservation by a trader of his competitor’s trademark as a keyword is a “use” “in relation to goods and services for which the trademark is registered”; and

ii.        That such use can therefore be prohibited by the proprietor of the trademark, but only “where that ad does not enable an average Internet user, or enables said user only with difficulty, to ascertain whether the goods or services referred to in the ad originate from the proprietor of the trademark or an undertaking economically connected to it or from a third party.”

In the present case, Advocate General Jääskinen, highlighting that the INTERFLORA trademarks have gained a “secondary meaning” denoting a “certain commercial network of florist providing a certain type of delivery service,” held that “an association between the trademark of Interflora and an identical delivery service of flowers provided by Marks & Spencer is possible and even likely in the mind of an average consumer.” If the ECJ follows the Advocate General on this issue, Marks & Spencer’s reservation of the Interflora trademark as a keyword to trigger its ads should therefore be considered an infringement.

On the second point, the Advocate General held that the use, as a keyword, of a competitor’s trademark with a reputation in a paid-referencing service, can also fall under Article 5(2) of the Trademark Directive, but only if said trademark with a reputation:

i.        is mentioned or displayed in the ad itself; and

ii.        “is either used as a generic term covering a class or category of goods or services” (protection against dilution by blurring); or

iii.        “the advertiser attempts thereby to benefit from its power of attraction, its reputation or its prestige and to exploit the marketing effort expended by the proprietor of that mark in order to create and maintain the image of that mark” (protection against free-riding).

By contrast, the Advocate General raised the point that keyword advertising using well-known third party trademarks should not be prohibited per sein the context of modern marketing relying on keyword advertising on the Internet”, especially “in view of the need to promote undistorted competition and more information to consumers”.

In this specific case, the Advocate General did not find Marks & Spencer’s use of Interflora’s trademarks diluted Interflora’s trademarks because the latter’s trademarks did not appear in the ad itself. However, the broad formulation retained by the Advocate General in defining this practice under trademark dilution should lead traders to be cautious when choosing their well-known rival’s trademark as a keyword.  [Béatrice Martinet Farano]