Google heading for global trademark storm

The internet search engine giant Google has announced that it will extend to 194 countries a scheme that allows companies to use their rivals’ trademarks for online advertising. Google will no longer consider requests from brand owners to take down “Sponsored Links” that use their trademarks to sell rival or even counterfeit goods.

Google’s main search function is not affected, but in countries outside the UK, users can now expect to see sponsored links on the top and right from companies that may be unaffiliated with the main search term.

“As of June 4, Google will no longer review keyword lists for monitored trademarks in these countries. This will bring these countries into line with the US, Canada, UK and Ireland who already employ this policy,” the company said in a statement.

Ben Novick, a spokesman for Google, told The Times: “In the UK we have changed our policy so that non-trademark owners can bid against trademark terms, and we won’t monitor those terms any more. This is the policy we are extending. The change affects around 190 countries, but it does not affect the EU apart from the UK and Ireland, where we already made this change because we felt local business practices were consistent with it.”

The move is certain to anger holders of valuable trademarks, some of which have already sought legal redress. The most prominent of these is the luxury brand Louis Vuitton, which has submitted its case to the European Court of Justice, Europe’s highest court.

Louis Vuitton’s claim is that Google’s paid advertising links are devaluing its core brand. A Google search for Louis Vuitton conducted by The Times on May 8, 2009, for example, revealed three sponsored links on the right hand side from other retailers, one of them for “L.ouis vutton Bags” (sic).

“This is about people who have invested in design, marketing, creation and brand-building being upset that someone else is taking their intellectual property and profiting from it,” David Wood, a legal spokesman for ICOMP, a cross-industry initiative to regulate the online marketplace, told The Times

Mr Wood said: “ICOMP’s mission stems from the belief that you are not going to have a trustworthy and respectful online environment unless people conform to the same high standards of behaviour that you expect on the high street. You don’t encourage respect in other people if you yourself do not respect other people’s rights.”

Speaking for Google, Mr Novick said: “Our ad text policy forbids the use of a trademark term in the three lines of ad text. In these examples, they don’t mention Louis Vuitton in the three lines of ad text. It’s not an exact match. If it were, we would not accept it. We have to trust users appreciating that that is not an official Louis Vuitton ad.”

Google is fiercely protective of its own intellectual property rights, however. Its terms and conditions state: “One of the conditions for all uses is that you cannot mess around with our marks. Only we get to do that.… Do not shorten, abbreviate or create acronyms out of Google trademarks.”

“What do you say about people who say one thing and do another?” Mr Wood said. “Or who apply one standard to themselves and a different standard to everybody else? This is not the kind of behaviour that will make the internet a trustworthy and friendly space.”

At 2.40pm on May 8, 2009, The Times conducted a Google search for the word “google”. It returned one sponsored link, to a site within Google UK, where one might have expected rival search engines to be paying for advertising. In contrast, a search for “Sainsbury” conducted shortly afterwards returned two sponsored links, one for car insurance, the other for a rival supermarket, Waitrose.

Mr Novick denied that Google has a policy of not accepting ads using its trademark: “We do accept sponsored advertising from our rivals. Since May 2008, we have allowed others to bid against our own trademark term.”

ICOMP is unconvinced by Google’s stance. Mr Wood said: “Brands object to other people profiting from their investment in brands without contributing to that investment. They hate the fact that they may have to enter into a bidding war with third parties in order to keep control of their brands, or to use the brands themselves. Or even if they don’t want to use their own brand in key word advertising, they may have to buy up the brand to prevent others from doing so.”

The European Court of Justice is expected to rule on the Louis Vuitton case later this year.