Although several courts have held that Google is not liable for selling ads to a competitor under a trademarked keyword a Federal Court has just held the advertiser is liable for buying the ads.
A California federal district court has just held that a law firm specializing in disability law WAS liable under the Lanham Act for purchasing advertising on Google Adwords under a trademark, in this case, the law firm name “Binder & Binder” .
The case Binder v. Disability Group Inc., C.D. Cal., No. 07-2760, was decided on January 25, 2011.
The court found that the purchase of a competitor’s registered trademark through Google Inc.’s AdWords program for sponsored keyword advertising on the search engine website constitutes use in commerce under the Lanham Act
Having concluded that Binder & Binder held valid trademark registrations, the court applied the eight-factor test for likelihood of confusion as set forth in AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 204 USPQ 808 (9th Cir. 1979).
The court found that the factors addressing similarity of the marks, the strength of the plaintiff’s marks, the similarity of services, the intent of the defendant, and marketing channels all weighed in favor of likelihood of confusion.The court also found actual confusion, based on the results of a survey, witness testimony, and other evidence.
The court awarded Binder & Binder $292,000.00 in lost profits and enhanced damages for willful infringement by the competing law firm.
This case does have the possibility of of being a HUGE game changer for Google and Bing/Yahoo.
Since all prior court decisions held in favor of Google saying that Google was allowed to sell adverting to competitors under Trademark terms, this practice has become more and more common place.
Now it seems while the courts have held Google is not liable for selling keyword advertising, the buyer of the advertising is liable and in this case to the tune of $292,000.
This could cause advertisers to stop advertising under trademark terms ultimately costing Google a lot of lost ad revenue.
Yes this could be a game changer.
It’s a big positive for generic descriptive domain name registrants, as advertisers would then shift their budgets to the generic terms (e.g. “cell phone” instead of “Verizon” or “music” instead of “itunes”).
@George,
You are absolutely right.
– TBC
here come the judge… here come the judge.
A game changer indeed:
For a change, one they cant pass the blame onto the Domainer.
Bing actually advertises with trademarked terms through Adwords.
“the buyer of the advertising is liable and in this case to the tune of $292,000.”
wow, do Google show some sort of disclaimer or warning to buyers or do they just let them choose whatever terms they want at their own peril ?
“For a change, one they cant pass the blame onto the Domainer.”
@Landon…until they can figure out a way how to 😉
I think they were stupid. Why would they were killing the other company by bidding on their company name, which is the worse thing for other company. All their term and name goes to make profit the compititors which is worse thing could happpen to anyone.
I mean come on, they could bid on other terms like law firms, but the CPC for such terms is very expensive that is why they may have decided to go after “binder and binder” term. What a nonsense.
But 292,000 would be a very expensive lesson. And they could do alot of good business if they have used this 292,000 for good terms like specific law, like city name attorney etc, but guess what they are paying the due.
I feel bad for both of these companies.
This had taught me and I will always keep this in mind when I use adwords, but I never used adwords so far in my life, but will soon.
Realistically u shouldn’t be allowed to bid someone else’s tm term. However perhaps google could add a disclaimer (in teeny tiny letters) to ads like this stating that the words “binder and binder” are tm of binder and binder. Credit given, problem solved right?
In another venue, tv advertising we’ve all seen burgerking mention mcdonalds in their ad’s, same with coke and pepsi. It should make a difference based on “how” the tm was used. Google should provide options that make it possible for the advertiser to use competitors terms in a legal way.
Gazzip
If I was the advertiser and just had a $300K judgment against me I would look to Google for reimbursement.
That’s why I was asking, but I have’nt used them so I don’t know if they warn people or not when they are selecting their keywords.
If they already do then there would’nt be much chance of getting Google to cough up….either way, google would probably drag it through the courts forever making it not a viable option for most.
Do you think this could have a similar impact for domainers who choose their own keywords on parking pages ?
@ MHB
Weighed in favor of likelihood of confusion.The court also found actual confusion, based on the results of a survey, witness testimony, and other evidence.
===
I can see .Co law suits by .Com Domain owners along this line of reasoning …
@Landon,
Maybe some .Co holders have cases against .com holders? Heck, why not?
“I can see .Co law suits by .Com Domain owners along this line of reasoning “.
In addition, I also think .co is going to be a huge landmine of lawsuits for registry/registrars/registrants given the way people are being mislead in to registering a ccTLD disguised as global/company/commerce etc blah blah blah on purpose by the parties involved just to trick innocent registrants to register this ccTLD.
.co was never supposed to be called global or anything else ….. it is pure and simple ccTLD for Colombia. Nothing more and nothing less. Calling it something else is damaging the trademarks and business of all the dot-com owners.
It will get very ugly….just watch how many .co UDRP have been filed and so far almost 100% won by the complainants.
It is my opinion and I may be wrong.
But I am willing to file a UDRP/lawsuit if I see my domains that we have registered for 10 years are being taken advantage of their originality and trademarks.
Thanks.
@RKB,
As long as the domain is generic in nature and the .Co holder isn’t doing anything to confuse consumers, I think the .com holder will have a bit of trouble getting ‘hold of that .Co domain.
Only time will tell.
This makes no sense. Let’s see:
Q. Hi, can I have a Coca Cola please.
A. Sure, but we also have Pepsi Cola and it’s onsale and it tastes great…Coke is on that box there, Pepsi is here. Choose
This is important.
Trademark issues have been plaguing adwords for years.
Google has a clear policy and process, and where a trademark is registered on their system, if you create an ad containing that trademark, then the ad is prevented from running automatically.
But it does not stop you bidding on the trademark keyword itself.
In terms of confusion, if I type a trademark and see a competitor ad bearing someone else’s domain name, where’s the confusion?
So is Google supposed to know every single registered trademark on the planet?
Maybe there’s an argument for that…
Hey Michael, I wonder about the longevity of this case. Do you think the 9th Cir. is likely to uphold it if the decision is appealed? My other question is what does this mean practically for brand owners… I mean, do we see a bunch of lawsuits against John Doe website operators for buying keyword ads that go to sign-up-for-info websites, with associated subpoenas to Google to unmask the ad purchaser? Because I’m not sure that waving this court decision in Google’s face and demanding that they unmask who the ad purchaser is will be particularly effective. Maybe if other district courts follow suit… I dunno. Would like to see a 9th Cir. decision upholding it, though. Then Google might be forced to change it up.
Of course, the arguments about “is this stuff really confusing” are legitimate, I think. Maybe in the context of disabled people searching for a disability law firm, it really is possible for the end consumer to be confused? But we’re (in the global sense) getting smarter all the time, as Internet users, and I think we’re probably much better at distinguishing whose product/service is whose, probably far ahead of the curve of current trademark law.
Very accurate observation George Kirikos.
Everyone take a breath. Buying an adword that’s someone else’s trademark does not infringe the trademark.
To prove infringement, the trademark owner must persuade a jury — with facts and evidence — that the advertisement triggered by the adword is likely to confuse consumers.
That confusion could be, for example, the false impression that the adword buyer is the trademark owner or is authorized to sell the trademark owner’s goods or services or is sponsored by or somehow associated with the trademark owner. And proving any of those w/o also putting the trademark in the text of the advertisement itself will be very difficult.
Buying adwords that are other’s trademarks is not going away.
The decision is as it should be. Google is no more liable for how people use their system than General Motors would be if I decided to run you over with a Chevy. General Motors sells cars. How the cars are used is up to the drivers.
If a competitor is using a trademark for legitimate comparative advertising, that’s one thing. But if a competitor is using it deceptively, that is quite another thing.
Same rule applies to guns.
@Dan Ballard
Isn’t that essentially what the defendants did in this case, minus an actual jury hearing? Is a jury hearing truly required for a case like this?
@Dave Zan
Dave, yup, that’s what happened in this particular case.
In Binder, the plaintiffs established during a bench trial, by a preponderance of the evidence, that the defendant’s use of adwords which were plaintiffs’ trademarks did, in fact, cause confusion in the marketplace.
There was no jury because the parties agreed that the judge would sit as the finder of fact.
But, yes, a full trial with a jury hearing the evidence IS required before the use of adwords can be found to infringe someone else’s trademark. The exception is when the judge believes, in a particular case and after viewing each side’s evidence, that NO reasonable jury could come to any conclusion other than the he or she would come to [i.e., either the adword use infringes or it doesn’t]. These grants of “summary judgment” occur but because “likelihood of confusion” requires such a fact-intensive analysis, judges are reluctant to end trademark infringement cases before a jury trial.