Last week came the news that the European Court of Justice (ECJ) had ruled in favour of Interflora in their case against Marks and Spencer for bidding on Interflora brand keywords in Google. The advocate general, Niilo Jääskinen, of the ECJ has recommended that brands should be found liable if they are found directly bidding on competitors terms, which means that Google may have to re-look at its trademark bidding policy.
Google has always claimed that it is not liable for any trademark breaches following a dispute with Louis Vuitton, but with this new ruling Google may have to concede to the EU and start to police trademark bidding within its search engine. This will go against Google’s principles as they look to be independent between the advertisers in this case Interflora and Marks and Specner. Google may want to take a more active stance on this matter as they are currently under investigation in another case from the European Union after accusations of anti-competitiveness and by working with the EU, this may help their future case that is currently being reviewed.
So what does this mean for brand trademark owners, Google and competitors?
– Google runs the risk of increased legal issues with advertisers in the future and Google’s reputation goes down within the industry
– There could be a reversal from Google on their trademark policy based on this EU ruling as Google is forced to police trademarked terms in future
– There would be a decrease in cost-per-clicks (CPC’s) for advertisers on their brand terms when competitors come off of these terms which could mean a drop in Google’s revenue
Brand Trademark Owners
– Sets a precedence which means that other large brands (such as Louis Vuitton) would look to challenge Google in the future regarding their trademark policy.
– Competitors brand bidders (and by association, their agencies) will be more nervous due to this new ruling and therefore may back off of these terms. This could decrease their advertising spend with Google especially ‘big’ advertisers such as Amazon.com.
In my opinion I do not expect to see immediate changes from Google regarding their trademark policy as it could take 6-12 months before we see changes implemented. I do expect to see changes in the SERP’s (search engine result pages) as competitors come off of trademarked terms following this ruling in the upcoming weeks. However, it will be interesting to see the Google response to this new ruling and how the World’s largest search engine will react to the European Comission’s recommendations.