New Zealand: Google Adwords – Trademark Issues Arising

Last Updated: 23 March 2011
Article by Corinne Blumsky

Google Adwords® is a useful tool to help get your business's name to the top of Google's search engine rankings. Google Adwords allows retailers to purchase key words that consumers use to find their products online. So what do you need to think about when purchasing these key words?

Google Adwords is growing fast. The use of Adwords is increasing. Google's total advertising revenues in 2009 were US$23 billion. This is big business.

But, with the increased use of Adwords, there are increased issues for advertisers to be aware of. We are often asked:

  • "Can I use another business's trade mark as a Google Adword to attract business to my website?"
  • "How can I stop another business from using my trade mark as a Google Adword to attract people to their site?"

So let's look at what issues can arise if another business's trade mark is used as part of an Adword.

What is Google Adwords?

Google Adwords is the system Google has developed to help a business market its products or services in the Google Search Engine, and its affiliate sites. It centres on the use of key words about a product or service offering.

When a consumer searches a Google search engine using certain key words as their search criteria, advertisements for certain words are shown as "sponsored links". The system is a "pay per click" system, which means you can dictate where your advertisement appears through bidding for a series of key words. You only pay the amount you have bid for if someone clicks on your advertisement as a result of a web search.

The advertisements take the format of a short text advertisement that includes a title line, two short descriptive lines and a URL link to a website or a specific website page.

Why use Google Adwords?

It is now clear there is a difference between the types of visitor to a website: "browsing visitors", or, "visitors that may have found a website in a search engine result", behave differently to visitors that come direct from Google Adwords or "pay per click visitors".

The reason for this is simple. Visitors that come to your site from just surfing for results are often browsing for information . On the other hand, visitors that come to your site through a pay per click advertisement know that when they are clicking on an advertisement, it is for a product or service they want to buy. So, Google Adwords is a more targeted way to get visitors to your site.

Are there any Google Adword restrictions?

In a words, yes. It is not possible to register Adwords for prescription drugs in New Zealand, illegal products like counterfeit products, drugs and drug paraphernalia, endangered species and fake documents, or essay writing services.

Interestingly, Google does not prevent parties from buying Adwords that are registered trade marks of other business's. This causes a lot of uncertainty. Some business's think that because Google does not stop you from adopting another business's trade mark as an Adword then it is permissible, but this is wrong.

Google Adwords trade mark policy

Google's Adword policy states that it recognises the importance of trade marks and that their terms and conditions forbid trade mark infringement by advertisers.

Google takes the view that it is the responsibility of the business adopting an Adword to carefully select and make proper checks to ensure that the key words selected do not infringe any existing trade mark rights.

However, Google has recognised that infringements can occur, so it has set up a complaints procedure to deal with these situations.

If a trade mark owner is concerned another business is using its trade mark as an Adword, then that business can complain to Google and lodge either a specific or a general trade mark complaint.

A specific complaint asks Google to investigate the use of a trade mark in a specific advertisement only.

A general complaint asks Google to investigate use of the trade mark in all relevant advertisements.

If Google decides the complaint has merit, it may require the advertiser to remove the trade mark from the advertisement text or key word list and prevent the advertiser from using the trade mark in the future.

Other legal considerations

Using another business's trade mark in an Adword may also be trade mark infringement, 'passing off' and a breach the Fair Trading Act.

If there is possible trade mark infringement, you need to consider how the Adword (trade mark) is being used. This will always depend on the specific situation. There could be grounds to claim trade mark infringement if the use of the Adword gives a misleading impression that the advertiser is connected with the trade mark owner, or is being used to sell the same products or services, or may result in consumer confusion.

As well as lodging a complaint with Google, you could also contact the advertiser direct and ask them to stop using the trade mark. Trade mark owners have legally protected rights, and should not take misuse lightly. If the advertiser's AdWords are managed by an outside company such as a search engine optimisation firm, the advertiser may not even be aware that their advertisements are using another business's trade mark.

If the advertiser refuses to stop using the Adword and if your Google complaint is unsuccessful, then legal action can be considered.

In conclusion

AdWords and other paid search terms are yet another challenge for trade mark owners to be alert to. For advertisers, trying to "ride the coat tails" of another trade mark is always a risk. The same care should be taken with choosing and using AdWords as with other forms of advertising. Also, you don't want to inadvertently build your online campaign around someone else's trade mark. Always choose your words carefully!

An edited version of this article was published in NZ Retail magazine, March 2011.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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