Owners of descriptive or generic trademarks ought to think twice before starting a keyword advertising lawsuit. The risk of getting a trademark revoked sometimes stands in no reasonable relation to the economic loss caused by the competitor’s ads.
However a significant number of trademark holders fear (considering the case where the defendant does NOT use his competitor’s TM in the text of the ad = “Adv-“) ….
a: Delusion: …that users, while searching the data ocean for their brand, might be lured away by Google’s perfidious nymphs and actually believe that they are purchasing a good (let’s say a lotus fruit by the brand Golden Fleece ) in “Alkinoos’s” webshop, when they are actually buying from “Circe’s” online presence.
Research has however shown that customers intensively dislike being leg astray in this way, as it significantly increases their search costs.
If such likeliness of confusion is ruled out by obviousness and if it appears hopeless that the gods will have a suitable argument at hand so as to grant an interim injunction on these grounds (not even justified any subconscious Google-bashing or technophobic fears), the second attempt usually is to…
b: Lure away: …make the brand owner feel like Penelope, hoping that her (brand) image is so strong that, users searching for her will stay on their course, withstand all temptations by Google’s sirens and will (plug wax into their ears or stay strictly focus on the organic search results part of the SERP) and finally proceed to the brand owner’s website. While Penelope’s image apparently was strong enough indeed for Odysseus, many brand images appear to be much weaker.
However, if a customer is searching for a specific brand he/she will continue on his way and he will be very difficult to distract (for more information on this please read my previous post on the issue of >>inattentional blindness<<). If a customer does get “distracted”, he/she has either deliberately chosen to examine a (comparable) item or was maliciously let astray (please see above).
I know that the law of unfair competition as well as trademark law should avoid the “imbrutement of customs“, but Adwords cases apparently also bear considerable risks for the plaintiff in that his/her trademark might get revoked, especially in keyword advertising cases which are based on relatively descriptive trademarks “Wein&Co“, “American Blinds“, “Philbrick“.
Thus, it is interesting that trademark holders litigate about issues involving 444 clicks or even less (84 clicks):
In the Austrian Supreme Court case “Wein&Co” there were 13.672 clicks onto the webshop of the defendant, during the time when the infringing ads were online and only 444 clicks stemmed from the infringing ads. (=3,3%) The 13.672 clicks had effectively lead to 78 orders, which means that in theory the 444 “mislead” clicks have caused 2,57 orders in the competitor’s webshop. I am not aware how much the average profit margin of an online purchase is, but I’m guessing it’s about 10 EUR, which would mean that the whole “Wein&Co” trial took place over 25,7 EUR.
Considering the marginal loss caused by keyword advertising and the possible dangers of litigation it is hard not to wonder who might be the real profiteer in the ongoing keyword litigation…