The State of the Internet: Keyword Advertising

by Caitlin R. Brandon (Attorney Profile)
Associate, Intellectual Property
Barnes & Thornburg LLP
11 South Meridian Street
Indianapolis, IN 46204
(317) 231-7550
LinkedIn


Keyword advertising is not a new phenomenon.  Some believe that various forms of keyword advertising have been around since as early as 1996. [1].  Generally defined as a “form of advertising on the Internet in which a business pays to have an advertisement [for] a website appear on [a consumer’s] computer screen when [the consumer] uses a particular word or phrase to search for information on the internet,” [2] keyword advertisements play a very important role in the marketing and advertising of many businesses.

Google AdWords is an increasingly popular form of keyword advertising. [3].  While other platforms have very similar programs, for consistency’s sake, this article will refer primarily to AdWords.  Say that a person was opening a CrossFit gym in Indianapolis and wanted to advertise the gym on Google.  The first step would be to create an online advertisement for the gym.  Next, the owner would choose search terms that would cause the advertisement to appear in Google when consumers typed in certain words or phrases.  For example, the owner may purchase “fitness Indianapolis,” “gym Indianapolis,” “CrossFit Indianapolis,” or other CrossFit related terms to cause his advertisement to appear.  If the words people type into the Google search box match the owner’s purchased keywords, the owner’s advertisement can appear above or next to the search results.

The situation becomes a bit stickier, however, if the owner of the gym buys a keyword or a Google AdWord that is a trademark owned by a third party.  For example, what if the gym owner wants to purchase a competing gym’s trademark as a keyword?  Is this trademark infringement?  If so, is Google liable for selling the trademark of another as a keyword?  Are consumers likely to be confused if they type in the name or trademark of the competing gym and an advertisement for the new gym appears?  The answer to all of these questions is, likely not.

The usual argument by plaintiffs challenging the use of their trademark as a search engine keyword by a third party is the legal concept of “initial interest confusion.” [4].  This initial interest confusion argument made by plaintiffs is as follows: when a consumer inputs a trademark, such as “Apple,” into a search engine and then sees a results page with an advertisement for a competitor—say “Microsoft” because Microsoft hypothetically purchased the keyword “Apple”—then the consumer is confused about whether Apple is somehow affiliated or connected with Microsoft. Plaintiffs contend that this is the case even if that confusion will be easily dispelled prior to purchase. [5].  Sound a little far-fetched?  Courts agree.  Courts have continually held that merely purchasing, selling, or using the trademark of another as a keyword does not result in a likelihood of confusion among consumers, and thus there is no actionable claim under the Lanham Act. [6].

With that understanding in mind, a trademark owner should ask himself a few questions prior to alleging any claim against a competitor or third party who has purchased his trademark as a search engine keyword:

1. Is the trademark being “used” in commerce? One statutory element of trademark infringement under the Lanham Act is that the infringing actor must be “using the mark in commerce.” [7].  Prior to 2011, the issue of use in commerce in a keyword advertising case was often very contentious and vigorously briefed by opposing counsel.  Now, however, it is well settled in most jurisdictions that use of a trademark as a keyword to display an advertisement does qualify as a “use in commerce” under the Lanham Act. [8].

2. What is the consumer searching for? Much of the discussion of how an Internet shopper could be confused by keyword advertising assumes that a person who types a trademark into a search engine must be searching solely in order to buy goods or services from the owner of that mark.  For example, the assumption is that if one types in Apple, one is searching solely for Apple products and not a category of goods more generally, say laptops.  Courts have continued to support this assumption, noting “Presumably [web shoppers] have narrowed their search because they have already selected [plaintiff] as the preferred retailer and are searching for its website or perhaps commentary on its performance.” [9].

However, with the increasing number of sophisticated Internet users, scholars have started combating the assumption that one who types in a trademark is searching solely for goods and services from the owner of that mark. [10].  One court recently rejected a plaintiff’s argument that web shoppers inputting plaintiff’s trademark “General Steel” were “searching exclusively for that company, as opposed to executing a broader search for all companies selling similar products.” [11].

3. Is the trademark used in the text or body of the advertisement? What happens if the previously mentioned new CrossFit Gym owner decides to not only purchase the trademark of his competitor as a keyword, but also use the trademark in the text or the body of his advertisement?  This scenario has not been litigated to the same degree as the merely purchasing a trademark as an advertising keyword scenario mentioned above, but the trend seems to suggest that use of the keyword in the body of the advertisement may in fact cause confusion among consumers. [12].  Indeed, in the case of Rosetta Stone Ltd. v. Google, Inc, the court pointed to one of the defendant’s own in-house studies which showed that a likelihood of confusion remained high when trademarks were used in the title or body of an ad or “sponsored link” that appeared on a Google search results page.

In sum, most courts note that attention should be focused on the visual appearance of the defendant’s advertisement on the search engine results page, because the potential infringement “arises from the risk that while using [plaintiff’s] mark to search for information about its product, a consumer might be confused by a results page that shows a competitor’s advertisement on the same screen, when that advertisement does not clearly identify the source or [sic] its product.” [13].  Accordingly, the new gym owner may very well be able to legally purchase the trademark or trade name of his competitor for keyword advertising.  However, if he begins to use the competitor’s trademark or trade name in the body of the advertisement itself, or otherwise tries to confuse consumers as to his affiliation or connection with the competitor, a court may find trademark infringement.


[1].  John Battelle, The Birth of Google, WIRED (August 2005), http://archive.wired.com/wired/archive/13.08/battelle.html.

[2].  Keyword Advertising Definition, CAMBRIDGE DICTIONARIES ONLINE, http://dictionary.cambridge.org/us/dictionary/business-english/keyword-advertising (last visited February 2, 2015).

[3] See generally GOOGLE ADWORDS, http://www.google.com/adwords/?sourceid=awo&subid=ww-ns-b-awhp_nelsontest_con&clickid (last visited Feb. 2, 2015).

[4].  See DANIEL C. GLAZER AND DEV R. DHAMIA, Revisiting Initial Interest Confusion on the Internet, 95 TRADEMARK REP. 952, 972 (2005). 

[5].  Network Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1148 (9th Cir. 2011) (“[I]t would be wrong to expand the initial interest confusion theory of infringement beyond the realm of the misleading and deceptive to the context of legitimate comparative and contextual advertising.”) (emphasis added).

[6].  J.G. Wentworth, S.S.C. Ltd. P’ship v. Settlement Funding LLC, 85 U.S.P.Q.2d 1780, 2007 WL 30115 (E.D. Pa. 2007) (“Even accepting plaintiff’s allegations as true—i.e., assuming that defendant did in fact use plaintiff’s marks through Google’s AdWords program or in the keyword meta tags for its website—as a matter of law defendant’s actions do not result in any actionable likelihood of confusion under the Lanham Act.”); Jurin v. Google Inc., 695 F. Supp. 2d 1117 (E.D. Cal. 2010) (Dismissed a keyword allegation against Google for failure to state a claim that web users are likely to be confused. In addition, Google was found to be immune under the Communications Decency Act.  47 U.S.C. § 230(e)(2) (2014).); General Steel Domestic Sales, LLC v. Chumley, No. 10–cv–01398–PAB–KLM, 2013 WL 1900562, at *10 (D. Colo. May 7, 2013) (internal citations omitted). (After trial, held that no likelihood of confusion was caused by defendant’s use of competitor’s trademark in Google keywords usage. “Advertisements on Google appear in a list as distinct and independent entries that internet users can browse and select at will . . . . [T]he connection between the search term entered and the appearance of an advertisement is too attenuated to suggest an actual affiliation.”).

[7].  15 U.S.C. § 1125 (2014).

[8].  Rescuecom Corp. v. Google Inc., 562 F.3d 123, 129 (2d Cir. 2009); Automation, Inc., 638 F.3d at 1144-1145; 1-800 Contacts, Inc. v. Lens.com, Inc., 722 F.3d 1229, 1242 (10th Cir. 2013).

[9].  1-800 Contacts, Inc., 722 F.3d at 1245.

[10].  ERIC GOLDMAN, Brand Spillovers, 22 HARV. J.L. & TECH. 381, 412 (2009).

[11].  General Steel Domestic Sales, 2013 WL 1900562, at *10 (citing Snow Mfg. Co. v. Sno Wizard Holdings, Inc., 829 F. Supp. 2d 431, 436 (E.D. La. 2011)).

[12].  Rosetta Stone Ltd. v. Google, Inc., 676 F.3d 144, 163 (4th Cir. 2012).

[13].  Network Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1154 (9th Cir. 2011) (quoting Hearts on Fire Co., LLC v. Blue Nile, Inc., 603 F. Supp. 2d 274, 289 (D. Mass. 2009)) (“In the keyword advertising context the ‘likelihood of confusion will ultimately turn on what the consumer saw on the screen and reasonably believed, given the context.’”).

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