Off the mark

In October 2009, I commented on the opinion of advocate general Poiares Maduro in Joined Cases C-236/08 to C-238/08 Google France ('Room to breathe', Solicitors Journal 153/37, 6 October 2009). The Grand Chamber delivered its much-awaited judgment in the case on 23 March 2010.

When you perform a Google search, in addition to the search results, you may be presented with a number of 'sponsored links' on the right-hand side of the results page or above the main results. Those links appear because traders have agreed to pay Google, using a service called AdWords, so that when a user enters a particular search term the advertising link will be shown. Evidently Google's commercial success is derived from advertising revenue (advertising made up $22.8 of its $23.6bn revenue in 2009 '“ including, but not limited to, the AdWords advertisements).

Various companies '“ including the brand owners of the Louis Vuitton label, a French travel agency operator, and what the judgment describes as a 'matrimonial services agency' '“ alleged that in operating this service Google acted unlawfully. The complaint was that by using a trademarked term entered by a user (say 'Vuitton') to trigger the delivery of an advertisement produced by someone other than the trademark holder and without the trademark holder's consent, Google was infringing their trademarks.

This turned out to be a surprisingly tricky question, depending on a rather detailed analysis of the rights granted by directive 89/104 (which harmonises national trademarks) and regulation 40/94 (which governs Community trademarks).

No relevant use

The ECJ concentrated its attention, first, on the question whether Google was 'using in the course of trade any sign which is identical to the [trademark]'. It was not difficult to decide that '“ whatever Google and its advertisers were doing, they were doing it 'in the course of trade', as part of a commercial activity. But was Google using the trademark? In one sense, of course it was. But not, the ECJ thought, in any relevant sense. It seems that it was the ECJ's view (though this is only obliquely stated) that 'use' means 'use for the purposes of communication'. In the ECJ's view, the advertisers did use the trademark, and Google permitted that use, but Google did not itself use it.

What about the advertisers? Obviously if the trademark actually appears in the text of the advertisement (as it did in one of the cases before the ECJ) there is 'use'. But what if it is used only 'behind the scenes' to select the advertisement? The ECJ thought that this was also a use (indeed, it said it was 'clear').

Possibility of confusion

That was not, however, the end of the case, because under EU law the rights granted to trademark proprietors can be exercised to prevent use only if that use adversely affects the functions for which a trademark is granted, which include guaranteeing (for consumers) the origin and quality of goods, and protecting communication, investment and advertising. Does the use of a keyword merely to select an advertisement '“ if that advertisement does not itself contain the trademark '“ prejudice those aims?