Update 64: July 13, 2009
1. The High
Court in London refers questions on AdWords to the ECJ
Interflora launched proceedings against M&S
in December 2008 to stop M&S bidding on its protected 'INTERFLORA' trade mark as
an AdWord on the Google search engine. The High Court in London has
decided to refer certain questions to the European Court of Justice for
determination. In his judgment, Mr Justice Arnold comments that Google's
decision to operate a different policy in the UK and Ireland to that in the rest
of Europe is "fairly remarkable given that the relevant law is, or should be,
essentially the same throughout Europe.”
For more information see Outlaw,
ECJ rulings on
Google keywords might not resolve controversy, warns High Court
A number of national courts around Europe have already
requested preliminary rulings from the European Court of Justice on a number of
the issues arising out of Google Adwords:
Case C-236/08 (Google France v Louis Vuitton Malletier), Reference from the Cour de Cassation:
"(1) Must Article 5(1)(a) and (b) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks and Article 9(1)(a) and (b) of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark be interpreted as meaning that a provider of a paid referencing service who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering infringing goods is using those trade marks in a manner which their proprietor is entitled to prevent?
(2) In the event that the trade marks have a reputation, may the proprietor oppose such use under Article 5(2) of the directive and Article 9(1)(c) of the regulation?
(3) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or the regulation, may the provider of the paid referencing service be regarded as providing an information society service consisting of the storage of information provided by the recipient of the service, within the meaning of Article 14 of Directive 2000/31 of 8 June 2000, so that that provider cannot incur liability until it has been notified by the trade mark proprietor of the unlawful use of the sign by the advertiser?"
Case C-237/08 Google France v Viaticum, Luteciel,
Reference from the Cour de Cassation:
"(1) Must Article 5(1)(a) and (b) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks be interpreted as meaning that a provider of a paid referencing service who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering goods identical or similar to those covered by the trade mark registration is using those trade marks in a manner which their proprietor is entitled to prevent?
(2) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or [Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark], may the provider of the paid referencing service be regarded as providing an information society service consisting of the storage of information provided by the recipient of the service, within the meaning of Article 14 of Directive 2000/31 of 8 June 2000, so that that provider cannot incur liability before it has been informed by the trade mark proprietor of the unlawful use of the sign by the advertiser?"
Case C-238/08 Google France v CNRRH,
Reference from the Cour de Cassation:
"(1) Does the reservation by an economic operator, by means of an agreement on paid Internet referencing, of a keyword triggering, in the case of a request using that word, the display of a link proposing connection to a site operated by that operator in order to offer for sale goods or services, and which reproduces or imitates a trade mark registered by a third party in order to designate identical or similar goods, without the authorisation of the proprietor of that trade mark, constitute in itself an infringement of the exclusive right guaranteed to the latter by Article 5 of First Council Directive 89/104/EEC of 21 December 1988?
(2) Must Article 5(1)(a) and (b) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks be interpreted as meaning that a provider of a paid referencing service who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering goods identical or similar to those covered by the trade mark registration is using those trade marks in a manner which their proprietor is entitled to prevent?
(3) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or [Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark], may the provider of the paid referencing service be regarded as providing an information society service consisting of the storage of information provided by the recipient of the service, within the meaning of Article 14 of Directive 2000/31 of 8 June 2000, so that that provider cannot incur liability before it has been informed by the trade mark proprietor of the unlawful use of the sign by the advertiser?"
Case C-278/08 Die BergSpechte Outdoor Reisen und Alpinschule Edi Koblmüller GmbH v Günter Guni and trekking.at Reisen GmbH,
Reference from the Austrian
"(1) Must Article 5(1) of the First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks ('Directive 89/104') be interpreted as meaning that a trade mark is used in a manner reserved for the proprietor of the trade mark if the trade mark or a sign similar to it (such as the word component of a word and figurative trade mark) is reserved as a keyword with a search engine operator and advertising for identical or similar goods or services therefore appears on the screen when the trade mark or the sign similar to it is entered as a search term?
(2) If the answer to Question 1 is yes:
(a) Is the trade mark proprietor's exclusive right infringed by the utilisation of a search term identical with the trade mark for an advertisement for identical goods or services, regardless of whether the accessed advertisement appears in the list of hits or in a separate advertising block and whether it is marked as a 'sponsored link'?
(b) In respect of the utilisation of a sign identical with the trade mark for similar goods or services, or the utilisation of a sign similar to the trade mark for identical or similar goods or services, is the fact that the advertisement is marked as a 'sponsored link' and/or appears not in the list of hits but in a separate advertising block sufficient to exclude any likelihood of confusion?
Case C-558/08 Portakabin Ltd v Primakabin BV,
Reference from the Hoge Raad der Nederlanden:
"(1)(a) Where a trader in certain goods or services ('the advertiser') avails himself of the possibility of submitting to the provider of an internet search engine an adword [when advertising via the internet, it is possible to pay to use 'adwords' on search engines such as Google. When such an adword is keyed into the search engine, a reference to the advertiser's website appears either in the list of webpages found, or as an advertisement on the right-hand side of the page showing the results of the search, under the heading 'Sponsored links'] which is identical to a trade mark registered by another person ('the proprietor') in respect of similar goods or services, and the adword submitted - without this being visible to the search engine user - results in the internet user who enters that word finding a reference to the advertiser's website in the search engine provider's list of search results, is the advertiser 'using' the registered trade mark within the meaning of Article 5(1)(a) of Directive 89/104/EEC?
(1)(b) Does it make a difference in that regard whether the reference is displayed in the ordinary list of webpages found; or in an advertising section identified as such?
(1)(c) Does it make a difference in that regard whether, even within the reference notification on the search engine provider's webpage, the advertiser is actually offering goods or services that are identical to the goods or services covered by the registered trade mark; or whether the advertiser is in fact offering goods or services which are identical to the goods or services covered by the registered trade mark on a webpage of his own, which internet users (as referred to in Question 1(a)) can access via a hyperlink in the reference on the search engine provider's webpage?
(2) If and in so far as the answer to Question 1 is in the affirmative, can Article 6 of Directive 89/104, in particular Article 6(1)(b) and (c), result in the proprietor being precluded from prohibiting the use described in Question 1 and, if so, under what circumstances?
(3) In so far as the answer to Question 1 is in the affirmative, is Article 7 of Directive 89/104 applicable where an offer by the advertiser, as indicated in Question 1, relates to goods which have been marketed in the European Community under the proprietor's trade mark referred to in Question 1 or with his permission?
(4) Do the answers to the foregoing questions apply also in the case of adwords, as referred to in Question 1, submitted by the advertiser, in which the trade mark is deliberately reproduced with minor spelling mistakes, making searches by the internet-using public more effective, assuming that the trade mark is reproduced correctly on the advertiser's website?
(5) If and in so far as the answers to the foregoing questions mean that the trade mark is not being used within the meaning of Article 5(1) of Directive 89/104, are the Member States entitled, in relation to the use of adwords such as those at issue in this case, simply to grant protection - under Article 5(5) of that directive, in accordance with provisions in force in those States relating to the protection against the use of a sign other than for the purposes of distinguishing goods or services - against use of that sign which, in the opinion of the courts of those Member States, without due cause takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the trade mark, or do Community-law parameters associated with the answers to the foregoing questions apply to national courts?"
Case C-91/09 Eis.de GmbH v BBY Vertreibsgesellschaft mbH,
Reference from the BGH:
"Is there use for the purposes of Article 5(1)(a) of Directive 89/104/EEC where a third party provides as a keyword to a search engine operator a sign which is identical with a trade mark, without the consent of the proprietor of that trade mark, so that, on inputting the sign identical with the trade mark as a search term into the search engine, an electronic promotional link to the third party's website advertising identical goods or services appears in an advertising block set apart from the list of search results, that link is marked as a sponsored link and the advertisement itself does not comprise the sign nor contain any reference to the trade mark proprietor or to the products it is offering for sale?"
The High Court in London has not issued its questions yet.
2. Microsoft files click-fraud
Microsoft has filed a civil complaint in United States District Court in Seattle
over click fraud and is seeking at least $750,000 in damages.
The complaint alleges, that by engaging in a widespread scheme that generated
invalid clicks on links to online ads that were displayed in response to search
requests for the game World of Warcraft
and auto insurances on Microsoft’s network, defendants disrupted the advertising
campaigns of their competitors, obtained increased user traffic for their own
ads at a much lower cost than they could have otherwise, and caused substantial
damages to Microsoft, which has lost revenues and expended substantial money and
resources to remedy the effects of defendant’s conduct.
According to Microsoft,
the company credited nearly 1,5 million US-dollar to auto insurance and WoW
advertisers in direct response to the click fraud.
complaint gives an example for click fraud: "An advertiser in a
particular industry such as auto insurance that has a sponsored site
appearing low on the result list could generate repeated clicks on the
higher-ranked sponsored sites of its competitors to the point that the
competitors’ advertising budgets were exhausted or the performance of their
sponsored sites was dramatically lowered. This would cause the
higher-ranking sponsored sites to drop off the results page or decrease in
the ranking, and the perpetrator’s lower-ranking sponsored site to rise to a
higher position in the sponsored site list."
Also see: The Register,
Microsoft sues family over alleged click fraud
3. Inventor of vibrating toilet
seat sues Google
Johnny I. Henry, an inventor of the
vibrating toilet seat (which was featured on the Jay Leno show in November
2008), filed a lawsuit against Google, Inc. and AOL, claiming that search
results delivered by Google and hosted by AOL are defamatory. His photo was
pictured on several web sites under the title "N-I-G-G-E-R invents vibrating
toilet seat." The complaint says that due to the web sites listed on search
engines, he will incurr psychological damage and will probably suffer
financial loss once his invention comes to the market
In his pro se
complaint, Henry states:
The extreme derogatory nature
of these web sites have committed a gross and negligible offense, not
only to myself but to our newly elected president and first lady, Mr.
Barack Hussein Obama and Mrs. Michelle Obama. I believe that without a
shadow of a doubt that this type of racist negative behavior is directed
at black people as a whole as well as all good hearted people that mean
good throughout this country and world.
Section 230 of Title
47 of the United States Code exempts service providers like Google from
liability for content posted by third parties. The lawsuit will almost certainly
be dismissed on that basis.
Webmaster can be held liable for Google snippet
his web site,
Joris van Hoboken mentiones an interesting preliminary judgement of the
court in Amsterdam. A snippet in the Google result list suggested that the
plaintiff was bankrupt, resulting in telephone calls from several users and
a regional newspaper. Usually one would expect a lawsuit against Google, but
in this case, the plaintiff went after the web master, who had written a
text that was completly legal and tried to hold him responsible for the
misleading combination of the sentences by Google. The court agreed, because:
plaintiff had suffered damages by the snippet
plaintiff had informed the defendant about the problem and asked him to fix
defendant had optimized his web site for search engines
defendant could easily have changed his web site so that the snippet would
also have changed.
about freedom of expession? If, at all, one can be held resonsible for the
snippet, it is Google. The court can't punish a web master, only because he
optimizes his web site and has some knowledge about the functioning of
search engines. He has no direct influence on the wording of the snippet.
Even if he had changed his web site, there is no guarantee that the snippet
would have changed too. If he had written "unable to pay his bills" instead
of "bankrupt", where would be the advantage in a snippet suggesting the
plaintiff was unable to pay his bills. If the defendat had to name the
plaintiff in his text (for what reason whatsoether), how can a judge say
that this has to be changed because of the conduct of an unrelated company
(Google)? The defendant has appealed the decision.
5. USA: Search Engines
ordered to stop misleading mortgage relief ads
The Making Home Affordable
Program aims at helping eligible home-owners to refinance or modify their
mortgages, so that they can afford to stay
in their homes. The
official website (http://makinghomeaffordable.gov)
provides information about the program. Starting in April 2009 misleading ads
appeared on search engines. When consumers searched for "making home affordable",
ads were shown that displayed the web address
But when they clicked on the ad, they were not directed to the government web
site, but instead to another web site offering loan modification services for a
fee. The FTC filed a lawsuit against unknown parties, because the defendants are
not identified in the ads. At their request, the District Court for the District
of Columbia issued a temporary restraining order that requires four search
engine providers (among them Google and Yahoo) to identify those who placed the
ads and to refuse ads containing
or any other domain name containing .gov.
The documents related to the case can be
6. The Thumbnail Dilemma
continues in Europe
In the article
light for search engines to use thumbnail images? I have provided an overview over the legal situation
concerning image search engines. I came to the conclusion that it is well
established in the USA that the creation of thumbnails, small low resolution
versions of the original, is fair use in the meaning of Section 107 of the U.S.
Copyright Act. In Germany however, differing court opinions could not yet
provide operators of picture search engines with the necessary legal certainty.
With this posting I
want to summarize the further developments since the writing of the article in
There have been no reports about new cases dealing with the thumbnail issue. But
it's worth mentioning, that starting from the beginning of 2008, Google has been
experimenting with the incorporation of graphical ads with image search results
(See e.g. Google adding display ads to image search,
In determining what
constitutes fair use a court has to consider inter alia the purpose of the use
including whether it is commercial or not. So far this factor usually has not
been interpreted against search engines, because they don't use the images in an
aestethic manner. Instead they help index and improve access to images on the
web thus providing a new and transformative use. The commercial nature of search
engines so far did not warrant another result, but the legal position of Google
might be weaker in possible future lawsuits with the ads beside the picture
search results. But it's still unlikely that this will be enough to swift the
balance of the fair use test in favor of the copyright owners.
In 2007 the District
Court of Erfurt (decision of March 15, 2007, Case No.
3 O 1108/05, full text (German) at
the fact that the thumbnails cannot be enhanced into high quality images
and that their depiction is beneficial to the copyright holder, because visual
search engines help users locate his works on the internet. Thus the court
assumed that there was an implied consent to the actions taken by search
appealed the decision and the Thuringian Higher Regional Court (decision of
February 27, 2008, Case No. 2 U 319/07, full text (German) at
did not follow the reasoning of the district court. Google failed to convince
the appeal court that the "implied consent" defense applies. In the eyes of the
judges, the upload of a work on a web site is not enough to find that the
copyright owner agrees to all search engine uses. So according to this opinion
thumbnails used by picture search engines usually violate the German Copyright
But then the court
came up with a solution to dismiss this specific lawsuit. The plaintiff was
engaged in search engine optimization. Under these circumstances, the court
found that the plaintiff had attracted crawlers and was estopped from raising
claims against search engines!
In my opinion this
approach has some serious flaws: The plaintiff had used metatags. The decision
only speaks of the keyword metatag, which is completely ignored by Google (see
Even under the assumption that the plaintiff had also used other metatags for
search engine optimization, there is still the problem that metatags are used to
increase the visibility of a web site within the (web) search results, not the
(picture) search results. So the court could not offer a solution what the
plaintiff should have done, if she wanted her web site to appear in the web
search results, but not in the picture search results. If she had optimized the
pictures for search engines (which is nearly impossible to prove), than the
reasoning of the court would have been correct, but only then.
To sum up, it would
have been better to consider the search engine optimization under the aspect of
"implied consent". The use of metatags shows that the copyright owner wanted her
works to be found. So it would be consequent to assume, she impliedly consented
to the necessary copyright uses by search engines.
The case has been
appealed to the German Federal
Court of Justice (BGH).
Even if Google wins there again, which is not unlikely given some statements of
the BGH on implied consent in another context (decision of December 20, 2007,
Case No. I ZR 94/05), picture search engines have one more problem to face. When
an image has been uploaded on a web site without the copyright holder's
permission, than there is no longer a basis for an implied consent. This problem
has already become immanent. A photographer and an artist sued Google for
copyright infringement and won. According to the Regional Court of Hamburg
(decision of September 26, 2008, Case No. 308 O 42/06, full text (German) at
Google infringes the making available right of the copyright owner, stipulated
in section 19 a German Copyright Act. The court examined several exceptions to
the copyright exclusivity, e.g. the right of citation, but found that no
exception applies. The court then stressed the importance of search engines for
the internet (although it mentioned that picture search is not as important as
web site search), but it also said that it was not up to the court to invent new
copyright exceptions. It saw no possibility to say that Google's actions are
legal. The decision has also been appealed.
So to conclude,
statutory limitations on copyright do not apply in the thumbnail context.
Picture Search engines rely on the weak "implied consent" defense. The only
Upper Court decision so far has rejected this argument and the regional court of
Hamburg decision pointed to the even greater problem that occurs when the
copyright owner did not grant any consent to the use of his picture on the web.
legislator alone can not solve the problem, because Art. 5 of the InfoSoc
Directive prevents the instruction of further limitations aimed at allowing free
digital usage (Directive 2001/29/EC of the European Parliament and the Council
of 22 May 2001 on the harmonisation of certain aspects of copyright and related
rights in the information society, EC OJ (2001) L-167 p. 10). It is up to the EU
legislator to find a reasonable solution to the thumbnail dilemma for all EU
7. In short
without new AdWords lawsuits in the USA:
Stratton Faxon v. Google, Inc. (New
Haven Superior Ct.
complaint filed May 27, 2009). For more information see: Goldman, Eric,
Another Lawsuit Over Google AdWords--Stratton Faxon v. Google,
Technology & Marketing Law Blog
Soaring Helmet Corp. v. Bill Me Inc., 2:2009cv00789 (W.D. Wash.
complaint filed June 9, 2009). The
For more information see: Goldman, Eric,
Google Sued Again for Trademark Infringement--Soaring Helmet v.
Leatherup.com, Technology & Marketing
Jurin v. Google, Inc., CV 09-03934 (C.D. Cal.
filed June 2, 2009).
For more information see: Goldman, Eric,
Seventh Lawsuit Over Google AdWords--Jurin v. Google
, Technology & Marketing
Ascentive, LLC v.
Google, Inc., 2:09-cv-02871-JS (E.D. Pa.
complaint filed June 25, 2009).
For more information see: Goldman, Eric,
Sixth Lawsuit Filed Over Google AdWords, Plus an Assault on Google's Organic
Search Results--Ascentive v. Google
, Technology & Marketing Law Blog.
Ascentive also claims that Google broke the law when, after a dispute, it
refused to list its web site in the natural search listings any longer and
did no longer allow Ascentive to participate in the AdWords program.
Ascentive tried to persuade Google to revoke the decision, but did not
succeed, not even in gaining the information why Google did this. Two emails
from Google only stated:
"Unfortunately, we will not
be reversing our decision regarding the suspension of your account.
Please respect our decision and as noted in our Terms and Conditions,
Google reserves the right to terminate advertisements for any reason."
and "As mentioned in our previous email, your Google AdWords
account has been suspended due to multiple policy disapprovals. We
are unable to revoke your account suspension, and we will not accept
advertisements from you in the future. Please note that our support
team is unable to help you with this issue, and we ask that you do
not contact them about this matter."
that appeared in search engine results to promote an IQ test has been banned
by the UK's advertising watchdog, the Advertising Standards Authority (ASA),
for failing to disclose in the text of the ad that participants would be
charged to receive their results. See Outlaw,
Search engine ad
for IQ test banned over hidden cost /
8. New in Legal
/ Seitz, Katja / Steffan, Jan / Steidle, Roland, Chrome mit Kratzern, DuD 2009,
Anmerkung zu BGH - AdWords, CR 2009, 326-328
Bohne, Michael /
Krüger, Alexandra, Das "Settlement Agreement" zwischen Google und der Author's
Guild als Leitbild einer europäischen Regelung, WRP 2009, 599-607
Bildersuchmaschinen und Urheberrecht, ZUM 2009,