Breaking news: Court of Justice rules on sale and use of AdWords

Hot off the press, the IPKat brings you news of this morning's ruling in Joined Cases C-236, 237 and 238/08 Google France, Google Inc. v Louis Vuitton Malletier; Google France v Viaticum Luteciel; Google France v CNRRH Pierre‑Alexis Thonet Bruno Raboin Tiger, a franchisee of Unicis. The factual backgrounds of the three cases, all of which have been referred from the French Cour de Cassation, are as follows:

Case C‑236/08 Google France, Google Inc. v Louis Vuitton Malletier

It was established at trial that (i) entering Louis Vuitton’s trade marks into Google’s search engine triggered the display of advertisements for sites offering counterfeit versions of that company’s products and that (ii) Google offered advertisers the possibility of selecting, to that end, not only keywords which corresponded to Louis Vuitton’s trade marks but also those keywords in combination with expressions denoting counterfeit such as ‘imitation’, ‘replica’ and ‘copy’. These facts led to Google being held liable trade mark infringement, a decision which was upheld on appeal. Google thereupon appealed on points of law to the Cour de cassation. That court referred for a preliminary ruling the following three questions:

‘(1) Must Article 5(1)(a) and (b) of [Directive 89/104] and Article 9(1)(a) and (b) of [Regulation No 40/94] be interpreted as meaning that a provider of a paid referencing service [ie Google] who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering infringing goods is using those trade marks in a manner which their proprietor [in this case Louis Vuitton] is entitled to prevent?

(2) In the event that the trade marks have a reputation, may the proprietor oppose such use under Article 5(2) of the directive and Article 9(1)(c) of the regulation?

(3) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or the regulation, may the provider of the paid referencing service be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service, within the meaning of Article 14 of [Directive 2000/31], so that that provider cannot incur liability until it has been notified by the trade mark proprietor of the unlawful use of the sign by the advertiser?’

Case C‑237/08 Google France v Viaticum Luteciel

Viaticum and Luteciel own French trade marks ‘bourse des vols’, ‘bourse des voyages’ and ‘BDV’. It was found at trial that, (i) by that entering Viaticum and Luteciel’s trade marks into Google’s search engine, the display of advertisements for sites offering identical or similar products was triggered and that (ii) Google offered advertisers the possibility of selecting for that purpose keywords which corresponded to those trade marks. However, the products sold on the advertised sites did not infringe those trade marks in question since they bore trade marks attributed to competitors of Viaticum and Luteciel. Google was held liable for trade mark infringement and, on appeal, of being an accessory to trade mark infringement. Google thereupon appealed to the Cour de cassation, which has referred two questions to the Court for a preliminary ruling.

‘(1) Must Article 5(1)(a) and (b) of [Directive 89/104] be interpreted as meaning that a provider of a paid referencing service who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering goods identical or similar to those covered by the trade mark registration is using those trade marks in a manner which their proprietor is entitled to prevent?

(2) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or [Regulation No 40/94], may the provider of the paid referencing service be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service, within the meaning of Article 14 of [Directive 2000/31], so that that provider cannot incur liability before it has been informed by the trade mark proprietor of the unlawful use of the sign by the advertiser?’

Case C‑238/08 Google France v CNRRH Pierre‑Alexis Thonet Bruno Raboin Tiger, a franchisee of Unicis

CNRRH is the holder of a licence for the French trade mark ‘Eurochallenges’, granted by Mr Thonet, the proprietor of that trade mark. At trial it was established (i) that entering ‘Eurochallenges’ into Google’s search engine triggered the display of advertisements for sites offering identical or similar products and (ii) that Google offered advertisers the possibility of selecting such a term as a keyword for that purpose. As in the second reference, the products offered on those sites did not infringe that trade mark and have been attributed to competitors. At trial. Google, Raboin and Tiger were held liable trade mark infringement, a decision which was upheld on appeal. Google and Tiger then filed separate appeals before the Cour de cassation, which referred three questions to the Court for a preliminary ruling.

‘(1) Does the reservation by an economic operator, by means of an agreement on paid internet referencing, of a keyword triggering, in the case of a request using that word, the display of a link proposing connection to a site operated by that operator in order to offer for sale goods or services, and reproducing or imitating a trade mark registered by a third party in order to designate identical or similar goods, without the authorisation of the proprietor of that trade mark, constitute in itself an infringement of the exclusive right guaranteed to the latter by Article 5 of [Directive 89/104]?

(2) Must Article 5(1)(a) and (b) of [Directive 89/104] be interpreted as meaning that a provider of a paid referencing service who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering goods identical or similar to those covered by the trade mark registration is using those trade marks in a manner which their proprietor is entitled to prevent?

(3) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or [Regulation No 40/94], may the provider of the paid referencing service be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service, within the meaning of Article 14 of [Directive 2000/31], so that that provider cannot incur liability before it has been informed by the trade mark proprietor of the unlawful use of the sign by the advertiser?’

The Advocate General advised the Court to rule as follows:

(1) The selection by an economic operator, by means of an agreement on paid internet referencing, of a keyword which will trigger, in the event of a request using that word, the display of a link proposing connection to a site operated by that economic operator for the purposes of offering for sale goods or services, and which reproduces or imitates a trade mark registered by a third party and covering identical or similar goods, without the authorisation of the proprietor of that trade mark, does not constitute in itself an infringement of the exclusive right guaranteed to the latter under Article 5 of First Council Directive 89/104 ... to approximate the laws of the Member States relating to trade marks.

(2) Article 5(1)(a) and (b) of Directive 89/104 and Article 9(1)(a) and (b) of Council Regulation (EC) No 40/94 ... on the Community trade mark must be interpreted as meaning that a trade mark proprietor may not prevent the provider of a paid referencing service from making available to advertisers keywords which reproduce or imitate registered trade marks or from arranging under the referencing agreement for advertising links to sites to be created and favourably displayed, on the basis of those keywords.

(3) In the event that the trade marks have a reputation, the trade mark proprietor may not oppose such use under Article 5(2) of Directive 89/104 and Article 9(1)(c) of Regulation No 40/94.

(4) The provider of the paid referencing service cannot be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service within the meaning of Article 14 of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (‘Directive on electronic commerce’).

In other words, said the Advocate General, it's not a trade mark infringement to buy, sell or use an AdWord -- but anyone offering a keyword sale service can't rely on the "I'm just an innocent information carrier and you can't blame me" exemption for liability in relation to the content of hosted information.

Today the Court of Justice has ruled as follows:

1. Article 5(1)(a) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks and Article 9(1)(a) of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark must be interpreted as meaning that the proprietor of a trade mark is entitled to prohibit an advertiser from advertising, on the basis of a keyword identical with that trade mark which that advertiser has, without the consent of the proprietor, selected in connection with an internet referencing service, goods or services identical with those for which that mark is registered, in the case where that advertisement does not enable an average internet user, or enables that user only with difficulty, to ascertain whether the goods or services referred to therein originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party.

2. An internet referencing service provider which stores, as a keyword, a sign identical with a trade mark and organises the display of advertisements on the basis of that keyword does not use that sign within the meaning of Article 5(1) and (2) of Directive 89/104 or of Article 9(1) of Regulation No 40/94.

3. Article 14 of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) must be interpreted as meaning that the rule laid down therein applies to an internet referencing service provider in the case where that service provider has not played an active role of such a kind as to give it knowledge of, or control over, the data stored. If it has not played such a role, that service provider cannot be held liable for the data which it has stored at the request of an advertiser, unless, having obtained knowledge of the unlawful nature of those data or of that advertiser’s activities, it failed to act expeditiously to remove or to disable access to the data concerned.

This post will be followed by a further post later, with comments on this ruling.

Wikipedia entries on AdWords and Keywords

What Google says about AdWords here

How to profit from Google AdWords here

Opinion of Advocate General Luís Miguel Poiares Pessoa Maduro here
IPKat comment on the Advocate General's Opinion here

Links and Law here