Die Bergspechte: Google AdWords and similar marks

In Die BergSpechte, the Court of Justice of the European Union (the ECJ) has ruled on when the purchase of keywords similar to a registered trade mark and which trigger advertisements shall constitute infringement.  The judgment was delivered only two days after Google France (see iPit post here) and draws heavily on its guidance.  However, whereas Google France addressed infringement in relation to identical marks, Die Bergspechte clarifies the test in relation to similar marks.

Background

Die BergSpechte Outdoor Reisen und Alpinschule Edi Koblmüller GmbH (Die Berspechte), was the owner of the following Austrian trade mark:

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The trade mark was registered for, amongst other things, travel arrangement and entertainment and sporting activities.

trekking.at, an organiser of walking and adventure tours, purchased as keywords, the terms ‘Edi Koblmüller’ and ‘Bergspechte’.  Searches for those terms using Google triggered advertisements for trekking.at’s services.  Die Bergspechte initially obtained an injunction before the case was appealed and the Austrian Supreme Court referred the following questions to the ECJ for clarification.

Questions referred for clarification

1.  Must Article 5(1) be interpreted as meaning that a trade mark is used in a manner reserved for the proprietor of the trade mark if the trade mark or a sign similar to it (such as a word component of a word and figurative trade mark) is reserved as a keyword with a search engine operator and advertising for identical or similar goods or services therefore appears on the screen when the trade mark or the sign similar to it is entered as a search term?

2.  If the answer to question 1 is yes:

(a) is the trade mark proprietor’s exclusive right infringed by the utilisation of a search term identical with the trade mark for an advertisement for identical goods or services, regardless of whether the accessed advertisement appears in the list of hits or in a separate advertising block and whether it is marked as a “sponsored link”?

(b) in respect of the utilisation of a sign identical with the trade mark for similar goods or services, or the utilisation of a sign similar to the trade mark for identical or similar goods or services, is the fact that the advertisement is marked as a “sponsored link” and/or appears not in the list of hits but in a separate advertising block sufficient to exclude any likelihood of confusion?

Does the use constitute infringement?

Article 5(1) of Directive 2008/95/EC and the case law interpreting that legislation, entitles the owner of a trade mark registration in the European Union to prevent third parties not having his consent from using in the course of trade:

(a) an identical sign in relation to goods or services which are identical to those for which the trade mark is registered, where the use of the sign affects, or is liable to affect, one of the functions of the trade mark, in particular its essential function to guarantee the origin of the goods or services but also the functions of communication, investment and advertising;

(b) an identical or similar sign in relation to goods or services which are identical or similar to those for which the trade mark is registered where there is a likelihood of confusion.

Infringement of an identical trade mark

The ECJ followed closely its judgment in Google France and stated that the purchase of keywords constitutes ‘use in the course of trade’ even where the sign does not appear in the resulting advertisement.

In respect of infringement of an identical mark there must also be an adverse effect on one of the functions of the trade mark, including its essential function of indicating origin but also its function of communication, investment and advertising.  The purchase of trade marks as keywords through a search engine is not liable to have an adverse effect on the advertising function.

However, there will be an adverse effect on the origin function where:

1. an advertisement suggests that there is an economic link between the advertiser and the owner of the trade mark; or

2. an advertisement is so vague that normally informed and reasonably attentive internet users are unable to determine whether the advertisement belongs to the owner of the trade mark or an economically unconnected third party.

Infringement of a similar trade mark

In respect of the test for infringement of a similar trade mark, the ECJ recited its own case law in Lloyd, Medion and Adidas that there is a likelihood of confusion where there is a risk that the public might believe that the goods or services come from the same or economically-linked undertakings.

The ECJ then ruled that there is a likelihood of confusion and infringement under Article 5(1)(b) where normally informed and reasonably attentive internet users are unable, or able only with difficulty, to ascertain whether the goods and services referred to in the advertisement originate from the trade mark proprietor or an undertaking economically connected to it or, on the contrary, originate from a third party.

The case will now be referred back to Austria for the court to determine whether on the facts the tests set out above are satisfied.  One anticipates that ‘Bergspechte’ may well be regarded as similar to the dominant and distinctive component of the registered mark but that ‘Edi Koblmüller’ does not do so.

Sponsored links

The ECJ declined to answer the second question as to whether it made any difference whether the advertisements were indicated as ‘sponsored links’.

Comment

The decision will be welcomed by trade mark owners. Although advertisers may use competitors’ trade marks, any ambiguity in the origin of the commercial message is likely to constitute infringement.

The legislation which introduced a harmonised trade marks regime to the European Union did not (and still does not) accommodate properly electronic commerce and the concept of instantaneous and automated advertising.  Nevertheless, a pattern is emerging as the ECJ strives to strike a balance between (i) the promotion of competition by allowing fair use of trade marks (ii) the protection of consumers from deceptive practices and (iii) the investment businesses make in promoting their brands.

It is interesting that the different tests for infringement of identical marks under Article 5(1)(a) and similar marks under Article 5(1)(b) have been aligned.  Irrespective of whether the marks are identical or similar, if the trade mark owner can show consumers cannot determine the origin, there may well be infringement.  That accords with the stated intentions in the preamble to the E-Commerce Directive 2000/31 that:

Commercial communications are essential for the financing of information society services and for developing a wide variety of new, charge-free services; in the interests of consumer protection and fair trading, commercial communications… must meet a number of transparency requirements.

All iPit posts on Google AdWords can be found here.

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