*It’s the Ad text, stupid; cryptic answers won’t help to establish legal certainty for online advertisers

I am glad to announce that the Oxford University Press has agreed to allow Dr. Ott and myself to link to the abstract, the full text (click the banner below) and even to the PDF version of our article published in the Journal of Intellectual Property Law and Practise.

At this point I’d like to thank once again all the people who contributed to this article by e.g. sharing their practical knowledge or by organizing an event that proved crucial for the better understanding of the subject; special thanks are directed of course to Dr. Ott who helped and encouraged me to express my ideas and views on the topic of keyword advertising.

*Where To Draw The Line? The Main Question Left After Google France

More than half a year after the ECJ published its decisions in Google France a number of questions still remain. While some questions might be answered by the Interflora reference (e.g. Art 5 (2) TMD), others will most probably remain open.

One question that will for sure remain is HOW an ad must be drafted so as not to have an adverse effect on the function of indicating origin. The ECJ ruled that ads must not be misleading or vague to such an extent that users might – incorrectly- assume a non-existing financial connection between the advertiser and the trademark used as a keyword to trigger the ad.

On the other hand, the court also expressed that Keyword Advertising per se does not have an adverse effect on the function of indicating origin. This means that Keyword Advertising in general has to be admissible and thus not infringing.

But where to draw the line? To me it seems that the border between ‘vague‘ and ‘not infringing‘ is a difficult one and that the courts need to have the discretionary powers to decide upon it.  When doing so, the courts may opt for either a TM-owner-friendly approach, a neutral position, or for an advertiser-friendly approach.

*One To Cure Them All? – Is The ECJ Using The Very Same Formula To Answer All Questions Related To Keyword Advertising?

Disclaimer: This is a 100% geeky trademark law post. Some readers might find it a bit difficult to understand… 😉

When analysing the ECJ’s most recent keyword advertising decision Portakabin I was surprised to see that the very same formula the court first used in Google France to define if the function of indicating origin got adversely affected in respect to Art 5 (1) lit. a …

84: The function of indicating the origin of the mark is adversely affected if the ad does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party.

*” It’s the ad-text, stupid” – Presentation @ Jour Fixe ULG Informationsrecht, University of Vienna

In the course of a Jour Fixe of the Universitätslehrgang für Informationsrecht und Rechtsinformation (IT-Law LL.M.) of the University of Vienna I got the chance to hold a short presentation about the recent Google France decisions.

The event was organized and chaired by Prof. Dr. Nikolaus Forgó (Leibzig Universität Hannover) and held in the office of Dr. Johannes Öhlböck LL.M. (IT-lawyer in Vienna, host of the website rechtsfreund.at).

After the opening words and short introduction of the speakers, Dr. Philipp Pfaller (Limesoda.at) shared his obviously rich experience as one of Austria’s leading Online Marketeers and provided the audience with a short but surprisingly practical and pinpointed introduction into the fields of Online Marketing, Search Engine Optimization and of course Keyword Advertising.

Dr. Öhlböck LL.M., the second speaker, focused on the legal aspects of search engine optimization and not only analysed the practise from the Austrian point of view, but also frequently referred to German court decisions in this field.

Having had two excellent speakers before me I was  in the fortunate position that most of the technical background of keyword advertising had already been explained in great detail and thus I focused on the trademark and unfair competition aspects of keyword advertising. Although I would have loved to give the audience a simple conclusion of the state-of-the-law on this issue (‘It’s the ad-text, stupid‘) or a prediction of how the French, German or Austrian courts will decide, I was left with analysing not only what the ECJ has actually said,  but, even more importantly, with highlighting all the questions that remain open.

Please see my presentation (in German) below. (In case you are interested in an English [slightly outdated, less sophisticated and surely less pretty] version of the presentation, click >>here<<.)

As a last point I’d like to thank not only the organizers and the host, but also the audience for their attention and the nice and truly inspiring discussion that followed the presentations.

PS: Good luck with your Master theses!

*Minor Translational Issue in the German Version of the ECJ’s Google France Decision C-236/08

While working on incorporating the decision into my thesis when I realized that a small mistake had made its way into the German version of the ECJ’s judgement. [For a detailed analysis of the decision please refer to my previous post.]

Paragraphs 96 et seq. are might be crucial for the decision as some authors see a justification/explanation in the subsequent paragraphs for the statement in par. 95 that keyword advertising (in principle) does not infringe the advertising-function.

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The second sentence of paragraph 97 reads in the English version as following:

“That display, which is, moreover, free of charge, means that the visibility to internet users of the goods or services of the proprietor of the trade mark is guaranteed, […].”

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The same section in the German version reads as following:

“Infolge dieser Anzeige, die im Übrigen unentgeltlich ist, ist die Sichtbarkeit der Waren oder Dienstleistungen des Markeninhabers für den Internetnutzer gewährleistet, […].“

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The word “Anzeige” used as the third word of the German version, actually means “advertisement” in English. The French version again uses the word “affichage“, which –to me limited knowledge– also means “display“.

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Thus I assume that the use of the word “Anzeige” (advertisement) was a mistake and that the correct term (in accordance with the English as well as with the authentic French version) should be “Darstellung” (display).

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Anyone disagreeing? I am just wondering how many authors will notice 😉

*From Biblical Questions To Delphian Confusion: The ECJ’s Decision On Google France C-236/08

“Seek and you shall find“. A legal dispute that began its career on the ECJ’s level with a quote from the new testament (Matthew 7:7) has – for now – found its end in a judgement which is as confusing as a statement of the oracle in Delphi might be. At this critical point the efforts of the IPKat  have to mentioned who not only organized – on very short notice – a (Google AdWords Rapid Response) seminar at Ashurst for over 100 people interested in the issue, but who also provided the audience with an excellent summary of the controversial judgement.

Dr Jeremy Phillips, Michael Edenborough, Dr Birgit Clark, Annsley Merelle Ward (from left to right)

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Before digging into the difficult questions I’d like to highlight a few issues I found rather clear:

– The ECJ held that Google cannot (directly) be held liable for selling trademarks as keywords and subsequently displaying ads (triggered by the keyword=trademark).

– Advertisers can be held liable on the basis of the content of their ads. The sole fact that they have booked a trademark as a keyword doesn’t amount up to a trademark infringement. National courts however have to decide if the “the ad does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party“.

Thus the court has missed its chance to simply say that, except for special circumstances (e.g. acts of unfair competition), ads not bearing the TM should not be seen as violating the TM-holder’s rights and ads that do contain the TM very likely do.

– While painstakingly trying to avoid the word “confusion” the ECJ has thus ruled that also cases of Art 5 (1) lit a (sign identical or similar, goods&services identical or similar), a de facto likeliness of confusion needs to be demonstrated by the TM-owner to forbid third parties the use of their trademark. The way the ECJ did this was to say that the TM-owners rights are violated if the functions of the TM are affected. And causing a ([confusion]) of whether or not the good or service advertised stems from the TM-holder affects the function of origin of a trademark. [49, 79]

– The court also seems to be in favour of the idea of granting Google’s AdWords service the liability exception provided by Art 14 of the eCommerce Directive. However the final decision on the subject of whether Adwords is “purely technical and neutral service” again lies with the national courts.

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The whole thing however gets a bit more complicated if one looks at the fact that:

– National courts have to decide whether users are able to ascertain if the goods or services originate from the trademark owner. This doesn’t sound like too difficult a task, but one has to look at the different national perspectives ranging from the ultra conservative French courts to the highly liberal German courts, who would for sure have little doubts to rule that the function of origin is usually not affected by an ad not containing the disputed TM.

– The national positions concerning the liability exception of Art 14 are similar to the question mentioned previously, except for the detail that in this case Austria is actually highly liberal, granting this exception to AdWords already since a Austrian Supreme Court decision in 2004. As the cases referred to the ECJ are however French, Michael Edenborough has put it like this:

“You must bear in mind, that the court is in France, the claimant is French, the defendant is American. Where do you think this will lead?“

Or in other words, does allowing the (obviously anti-Keyword Advertising) French court to decide on the liability exception mean that the exception was not meant to be granted anyway?

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Issues the court definitely did not get right:

-The court seems effectively mistaken in its assumption that the (also protected) advertising function of the TM is not affected as the TM-owners website usually appears (rather high up) inside the search results anyway and thus the TM-owner still has the chance to advertise/communicate/convince potential customers.

This sounds pretty reasonable at first glance, but if you think about it a bit longer you might wonder if one can really assume that a TM-holder can actually be found by users if his/her website is not displayed on the very first page of the search results. In theory one could assume that users might keep searching for the TM-owner, but I think the reality is that most users don’t have a clue about Boolean search operators and due to the Primacy Effect it is illusory to expect users to do little more than using the scrolling wheel of their mouse to scroll down on the first results page.

Does this matter? I believe so, as in the cases at hand all of the claimants were listed on the first page of the search results. Thus, if a national court might have to issue a decision in a case where the TM-owner’s website is not shown (on the first page) in the search results, the (?French?) court might assume that his case is substantially different from the cases upon which the ECJ had to decide and is thus not bound to its ruling.

I do know the last point, which was actually brought up by Dr. Stephan Ott in the course of preparing an article on that topic, might be a highly theoretical one, but… I would certainly not be surprised to see a national court using it to justify its decision.

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For more information on the cases please refer to the video stream of the Google AdWords Rapid Presponse Seminar, which was hosted by the IPKats, Eric Glodmann’s blog, Adam Smith’s article on the Blog of the World Trademark Review, a short article on OUT-LAW.com,  a analysis (in German) by Dr. Stephan Ott on his Links&Law website or a short newspaper article (in German too) by Austrotrabant. A more elaborate version of this and Dr. Ott’s post will be published in the next issue of the German law Journal MarkenR; Ott/Schubert, Fremde Marken als Keywörter – Orakelsprüche des EuGH als Antwort auf biblische Fragen, MarkenR 2010, 173 (link hopefully coming soon). 

*ECJ: “Google France v. Louis Vuitton” Expected For The 23rd Of March 2010

The ECJ has scheduled to rule on the 23rd of March on the famous Google France, Google Inc. v Louis Vuitton Malletier (joined cases C-236/08, C-237/08, C-238/08) case.

Following the heavily discussed opinion by GA Maduro much attention will be paid to the decision as, although it only/mainly concerns the liability of Google’s AdWords program,  it may also contain clues of whether or not, the ECJ sees the use of TM-terms as keyword to constitute “trademark use” and/or if the ECJ is willing to grant extra protection to the communication- or advertising functions of trademarks.

For more information please refer to OUT-LAW,  my previous posts on that matter (here & here) or see below for my graphical summary of the opinion.

Graphical Representation of the GA's Opinion by Austrotrabant. Click to enlarge

*Graphical summary of the GA’s opinion on the French Keyword Advertising cases

Having pondered about the GA’s opinion for some time I’d now like to sum my conclusions up. I’ve especially considered the statements published by Mackenzie, Ott, the IPKat and van Hoboken.

To enlarge the pictures just click onto the thumbnail above or onto the picture below. Although I’ve really tried to find a way to display most aspects of the opinion in a simple and comprehensible way, I do not recommend it for people who searching for an introduction into the topic, as the stuff is still quite complicated.

My criticism:

First of all I really do like the GA’s general view of the issue and agree with him e.g. on the nature of the internet. However, I do have to wonder if the ECJ will follow the GA on all issues. So for example…

– I am looking forward to seeing if the ECJ will agree with the GA’s splitting of the keyword advertising process into two separate issues and thus seeing the booking of the keywords by the advertiser as a non-commercial act and the selling of the keywords as a seperate service to the linking of ads to websites.

click to enlarge

– I share the GA’s view on the likeliness of confusion and welcome the fact that the GA kind of follows the “multi factor test“, as suggested by the District Court of Massachusetts.

– I am reluctant to agree that the search process should be compared to “caching” and the process of displaying ads to “hosting“. In my opinion, it doesn’t make much sense to “forcefully expand” the existing provisions to fit onto these two concepts as well. Clear-cut exceptions would be more useful, but would require the EU Comission to act; something it is apparently a bit reluctant to do…

– I am also very sceptical towards guiding claims against AdWords and the advertiser towards national liability rules, as I think that harmonised laws would create more certainty & security for business and consumers and thus be far more efficient.

click to enlarge

I’d appreciate any comments.