French Supreme Court holds Google keyword advertising practices lawful

On 25 September 2012, the French Supreme Court issued a new landmark decision (non-official, available in French only) in the Google keyword advertising saga.

It may be recalled that the important ECJ decision Google France (ECJ Joined cases C-236/08 and C-238/08, see Newsletter 6/2011 p.7) had started with a preliminary reference from the French Supreme Court to the ECJ on the potential liability of Google for its practice of selling sponsored links consisting in third party’s trademarks, notably after several French Courts had found Google liable for such practice.

In its decision, the ECJ broadly ruled for Google, concluding that Google was neither directly liable – since it did not make any “use in the course of trade” of such trademark when merely offering them as a sponsored link to its customers – nor indirectly liable for trademark infringement, since it was protected by the hosting safe harbor as soon as it was not playing an active role in the drafting of the commercial message accompanying the sponsored link or in the establishment or selection of the relevant keyword. Yet, some lower courts in France continued to hold Google liable on different grounds (see e.g. Google v. Cobrason, CA Paris, 11 May 2011). A decision from the Supreme Court was therefore highly awaited.

In this case, the French Supreme Court held that neither Google, nor the advertiser buying keywords consisting in (third party) trademark were liable as long as (1) the keyword provided a link to content clearly marked as advertising content (e.g. sponsored links, separated from natural result) and (2) there was no confusion as to the source of the product. This decision, essentially in line with the ECJ most recent case law in this area (see Case C-323-09 Interflora v. Marks & Spencer, Newsletter 6/2011 p.9) will therefore be welcomed by Google, and more generally by platforms using keyword advertising as a revenue model. [Béatrice Martinet Farano]