Unlawful competition through Google advertising?

Google has been sued a number of times for trademark infringement in the United States largely due to the way companies advertise through Google.  A recent lawsuit was brought by American Blind which has claimed that Google’s sale of terms such as “American blind” and “American blinds” to competitors of American Blind constitute an infringement on American Blind’s trademarks.  According to InternetNews:

“In an escalating legal battle with big implications for search marketing, Google has been hit with a lawsuit claiming that its sale of the terms “American blind” and “American blinds” as keywords involves trademark infringement.

American Blind and Wallpaper Factory filed a complaint against the search giant, as well as its distribution partners, AOL, Ask Jeeves and EarthLink, in a New York federal court Tuesday. The suit comes a week after AOL settled a suit with Playboy involving similar issues.

The suit claims Google’s practice of selling text ads related to keyword search terms takes advantage of American Blind’s trademarks, because competitors’ ads can appear on results pages that appear when users search for “American blinds” and “American blind.” American Blind is asking that Google be permanently stopped from selling those keywords.”

These text ads appear not only on Google’s search results pages but on websites worldwide that participate in Google’s AdSense program.

In a South African context this raises an interesting question in my mind.  Could it be argued that a similar practice of using a competitor’s trademark (or even its name) either in similar advertising or even in the metadata keywords embedded in your website’s code constitute passing-off?  So what is passing-off?  According to Amler’s Precedents of Pleadings (6th edition):

“A passing-off action protects the goodwill or reputation of a trader’s business, merchandise or services against a false representation by a competitor to the effect that the business, merchandise or service of the competitor is that of the plaintiff or that it is associated with the plaintiff.  It also provides protection against deception as to trade source or trade connection.”

Website owners have used certain keywords in the hidden code in their websites to manipulate search results on search engines like Google, Yahoo! and MSN Search for years now.  For example, you find that an airline will include the word “sex” in its website’s metadata because that term is a popular search term.  What if, instead of using popular generic terms, a company uses its competitor’s name or trademark in its metadata or buys an ad on Google using keywords relating to its competitor in an effort to ensure that even when someone searches for the competitor, that company’s results appear on the search results page?  There may well be an argument that the company is passing itself or its services off as being associated with the competitor.

The problem is nicely expressed in a quote on in the InternetNews article from a representative of American Blind:

‘”We have a federal registered trademark for American Blind and Wallpaper Factory. We do object if you go to Google and type in that exact phrase that consumers may misleadingly be directed to a competitor’s link,” Rammelt said.’ (emphasis added)

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