Unlawful trademark infringement via Google Adwords
We previously published a blog about an IP action involving the same issue as in this action, namely: is it unlawful to promote one’s company under the same brand name as another company via Google Adwords? The District Court of The Hague recently gave a judgement about this in a legal action. Attorney Hidde Reitsma explains.
Advertisement with Google Adwords leads to action
Fleurop, which enjoys substantial name recognition in (amongst other countries) the Netherlands, operates a flower delivery network with which independent florists are affiliated. The Fleurop network is comprised of some 1200 individual florists. Topbloemen, one of Fleurop’s competitors, tried to profit from Fleurop’s name recognition by linking itself to Fleurop via Google Adwords’ advertising keywords, such that, if one typed-in ‘Fleurop’ in Google, Topbloemen’s advertisements would appear at the top of the page.
Fleurop demands that Topbloemen stop using its brand name
Having become aware of this, Fleurop immediately took action, demanding that Topbloemen cease and desist from using its brand name, as this use affected the ‘function of indicating origin’ of Fleurop and thus caused a danger of confusion vis-à-vis the public.
When is the use of a brand name via Adwords unlawful?
To assess the alleged unlawfulness, the court employed the judgement in the Interflora action as a guide. In this judgement, the manner in which the relevant advertisement in Google has been designed had been crucial.
Function of indicating origin used to assess (un)lawfulness
In the above-mentioned judgement, it was determined that, if it is impossible or difficult for a normally informed and reasonably observant internet user to see a difference, the function of indicating origin has been affected. It is then the case that infringement is involved and that the infringement must cease.
Court: examples of trademark infringement
In the decision, a number of examples were employed for illustration purposes. The court stated that, for example, in a situation in which the advertisement immediately appears after the brand is typed-in as a search term and is also still displayed on the search screen, the internet user easily can become confused as to the origin of the products or services in question. The same applies if an internet user must endlessly scroll down in an attempt to determine the company.
Market research demonstrates lack of clarity about brand name
Subsequent to investigation, the court concluded that the (reasonably informed) internet user finds it difficult to determine whether Topbloemen is affiliated with, or a competitor of, Fleurop. Market research had been carried out, demonstrating that Fleurop enjoys substantial brand recognition. The advertisements themselves had also been studied. According to the court, there was in any case a lack of clarity, which in its view could potentially lead to confusion.
Topbloemen prohibited from using brand name Fleurop
Based (amongst other things) on the above-mentioned considerations, the court ordered Topbloemen to desist and continue to desist from any infringement of the brand, Fleurop. In addition, Topbloemen was ordered to pay all of the costs incurred by Fleurop in the action, pursuant to Art. 1019h Rv (Code of Civil Procedure). Comprehensive cost orders are quite unique to Netherlands law and occur primarily in connection with IP actions. As legal costs can easily accumulate quickly, this is an aspect which should thoroughly be taken into account in advance.