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Keyword Advertising Infringement Lawsuits: Recent Updates

By Eric Misterovich

We all know internet marketing has expanded in popularity in recent years.  While consumers may praise the ability to buy nearly anything from their living room, the new online marketing arena has also raised significant questions in intellectual property law over what online businesses can use to advertise.  As one example, competitive keyword advertising is a process where a business uses words from its competitor’s trademark to advertise in keyword-triggered search engines online. Over the last decade, this strategy has prompted countless trademark lawsuits.

Federal Courts Reject Plaintiffs’ Trademark Infringement Claims

Just last year, the Ninth Circuit heard a case, CollegeSource, Inc. v. AcademyOne, Inc., involving two websites designed to help potential college students research school options. While CollegeSource held trademarks to the titles “CollegeSource” and “Career Guidance Foundation,” AcademyOne bought Google Ad Words like “college,” “college source,” and “career guidance.”

Ultimately, the court rejected CollegeSource’s claim of keyword advertising infringement by looking at (1) whether there would be significant consumer confusion because of the keyword driven advertisements, (2) whether the sponsor of the link was clearly identified, and (3) whether the search area was one where consumers would have incentive to do careful research before making any purchasing decisions.  Because AcademyOne clearly identified itself as a sponsor of the resulting advertisements, and because the court found students are likely to put significant research into college attendance decisions, there was no trademark infringement.

Even more recently, General Steel Corporation sued Armstrong Steel Corporation for running Google AdWord Ads using the title “General Steel.” Despite the fact that Armstrong used references to General Steel in a non-comparative way, the court held that there was no trademark infringement because (1) Armstrong was visibly distinguished from the General Steel Corporation, (2) Armstrong clearly identified itself as the sponsor of the advertisements, and (3) the Armstrong advertisements had a merely ancillary relationship with the actual keywords used by online consumers.

What Might it Take to Win a Keyword Advertising Lawsuit?

While most of the recent trademark infringement claims over keyword advertising have been unsuccessful, there are still rare instances when a court might be willing to find just such keyword advertising infringement.  Some questions to consider if you think a competitor might be violating your trademark include:

  1. Does the keyword advertisement cause significant consumer confusion?

In the CollegeSource case, the Ninth Circuit focused on the fact that AcademyOne’s keyword search advertisements received a mere sixty-five hits over a month long period.  Apparently, the more online customers use a company’s keyword advertising scheme, the more potential there is that significant consumer confusion may occur.

  1. Is the sponsor clearly identified within the advertisement? 

In both the General Steel and CollegeSouce cases, the companies’ advertising competitors were clearly identified as the sponsors of the online advertisements using the trademarked terms.  Because Armstrong Steel and AcademyOne both openly distinguished themselves from their competitors within the advertisements, the courts found it was unlikely there would be any consumer confusion regarding which company produced the ads.  Although in most cases companies producing this kind of advertisement will identify and distinguish themselves from their competitors, in the event that this does not occur, there may be a greater opportunity to claim trademark infringement.

  1. Is this an area where consumers are likely to do a high amount of research?

In the CollegeSource and General Steel cases, the courts emphasized that steel buildings are a significant financial investment, and college is a complex, time consuming, and important life decision.  Due the potential investments of consumers in both cases, the courts explained it was unlikely consumers would make decision without substantive research.  This, in turn, would downplay any potential confusion between the different businesses in each case.  However, if the topic area advertised is not as important to an individual’s life path and finances, it may be that there is a greater possibility for deceiving unknowledgeable customers, which could lead a court to push the balance in favor of finding trademark infringement.

If you have additional questions about how trademark law and online advertising intersect, contact the keyword advertising lawyers at Revision Legal. 

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