Searching for flowers: the blossoming ECJ judgment

A cutting edge judgment from the European Court of Justice¹has indicated that a business who uses an internet keyword consisting of another party’s trade mark to direct searchers to its own advertisement or website may be infringing the rights of the trade mark owner. This is the case even though the trade mark does not appear within the advertisement or website itself.

Marks & Spencer plc (“M&S”) purchased a number of Google ‘AdWords’ containing the ‘Interflora’ name. The purchase of an ‘AdWord’ enables a link (in this case, to M&S’s own flower delivery service) to appear at the top of the search results when someone googles a term consisting of that ‘AdWord’. Interflora has registered its name as UK and Community trade marks. Interflora alleged that the use of such ‘AdWords’ was an infringement of its trade marks.

The case has been ongoing for several years, and, in 2009, the High Court made a reference to the European Court of Justice (“ECJ”) with several key questions on the application of EU trade mark law² to this situation. Two potential causes of action were considered:

1. use of an identical mark in relation to identical goods and services³; and
2. use of an identical trade mark in relation to dissimilar (or, by application of earlier case law, identical or similar) goods and services, where such use without due cause takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the mark⁴.

It had stemmed from previous case law that selecting a trade mark as a keyword to direct internet users to an advertisement did constitute ‘use’ of the trade mark ‘in relation to’ the relevant goods and services (even where the keyword did not appear in the advertisement itself). However, in order to prevent such use, additional elements had to be satisfied:

• in the case of (a), the use must adversely affect one of the functions of the trade mark; here the ECJ considered three such functions: indication of origin, advertising and investment.
  • The indication of origin may be adversely affected if (to summarise) the use does not enable the reasonable person to ascertain whether the relevant goods/services originate from the trade mark owner or from a third party. For example, in this case, did searchers consider that M&S was part of the Interflora network?
  • Whilst the advertising function would not be adversely affected (as this function does not protect against competition), the investment function could be, where the use of the mark interferes with a reputation capable of attracting consumers and retaining loyalty.
• In the case of (b), the ECJ considered three situations against which this provision protects: ‘free-riding’ (taking unfair advantage of the distinctive character or reputation of the trade mark), ‘dilution’ (such as turning the trade mark into a generic term), and ‘tarnishment’ (where use is detrimental to the reputation of the mark). The ECJ focussed here on the issues of ‘free-riding’ and ‘dilution’. In relation to the former, the court distinguished between:
  • taking a ‘ride on the coat tails’ of the reputation of a mark (which could constitute infringement); and
  • fair competition to provide an alternative to the relevant goods and services without being a ‘mere imitation’ of them (which would not constitute infringement).

With the ECJ having provided guidance that there is potential for trade mark infringement, it is now for the High Court to germinate its decision on the specific facts of the case. In the meantime, budding advertisers should be alert to the risk of trade mark infringement in selecting an ‘Adword’ or other internet keyword corresponding to their competitors’ trade marks.

Olivia Whitcroft, Principal of OBEP, 8 November 2011

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This article provides general information on the subject matter and is not intended to be relied upon as legal advice. If you would like to discuss this topic, please contact Olivia Whitcroft using the contact details set out here: Contact Details

Also published in the December 2011 LawWorks Choices Chronicle.