Canada: B.C. Supreme Court Rules On Keyword Dispute

As online advertising changes the marketing landscape, the use of sponsored links and keyword advertising is testing the scope of trademark rights. The sometimes controversial practice of "keyword advertising" (such as Google AdWords) was at issue in a recent passing off action from the British Columbia Supreme Court. The Court held that the defendant Vancouver Career College did not pass off its services as those of the plaintiff Vancouver Community College through its use of the keyword "VCC".1

What You Need To Know

  • What is Keyword Advertising? A website operator can place bids with search engines like Google for specific keywords to be associated with their website. When a keyword is searched, the search engine will display the highest bidder's ad or website as a "sponsored link" (clearly distinguished from organic results). When that link is clicked, the website operator will be charged the amount of its bid.
  • B.C. Ruling. This decision, which is currently under appeal, is of particular interest to online businesses and those who rely on online advertising.
    • The Court held that keyword advertising is not passing off, and that using a competitor's business name(s) or marks as keywords is an established part of online advertising. To restrain the defendant's use of this service would be to put them at a competitive disadvantage.
    • The Court focused on the advertiser not having control over the process employed by search engines in generating search results. A searcher chooses which sites to investigate and should he/she be led to a competitor's site through keyword advertising, no harm is done as the searcher can retreat from that website upon identifying it as the competitor's and return to the original search.

Background and Analysis

Vancouver Community College, the plaintiff, claimed common law trademark rights in "VCC" as an abbreviation of its name and as a term it had used in public marketing. The plaintiff alleged Vancouver Career College misrepresented its educational services as those of the plaintiff  through keyword advertising.

Subsection 7(b) of the Trade-marks Act prohibits selling goods or services in such a way as to cause confusion between the goods and services of another. To succeed in an action for passing off, the plaintiff needed to satisfy the court that it enjoys goodwill in the trademark, and that the trademark has acquired distinctiveness (i.e., a "secondary meaning") in the marketplace.  The plaintiff also needed to establish that the defendant had misrepresented its services as those of the plaintiff and this caused confusion that harmed the plaintiff as a result. 

The Court found the plaintiff had established goodwill in the name Vancouver Community College, but failed to establish that there was acquired distinctiveness or a "secondary meaning."  In determining if the defendant had misrepresented its educational services as those of the plaintiff, the Court analyzed the issue from two different perspectives: competition and control. 

The Court interpreted the strategic use of keyword advertising as fair competition and not passing off. Keyword advertising is an established practice in online advertising. Granting damages to the plaintiff or preventing the defendant from using this strategy would be to disadvantage the defendant in a way that other online advertisers are not.

The Court held that engaging in keyword advertising, even when the keywords are related to the name or marks of a competitor, is not an act of causing confusion or misrepresentation because the element of control is absent. The advertiser may have control over what keywords it chooses to bid on and by what amount, but it does not control the bidding process. A bid on a keyword is not guaranteed to send a searcher to the bidder's landing page, nor is the process of the search controlled by the bidder. The searcher is the one who must decide the course of their search. They may click on the bidder's page or return to the search and move in a different direction entirely. As a result, a business using online keyword advertising cannot be said to control the search process.

Furthermore, the Court also borrowed reasoning from similar cases in the United States in regards to "initial interest confusion," a term of art that has not been formally adopted in Canada. The underlying premise is that when a user, deliberately searching for the plaintiff's product or  service, is led to the defendant's site instead, this may cause initial confusion. However, this initial confusion may be fleeting and insufficient to demonstrate the confusion necessary to be reasonably actionable.

Based on its reading of the authorities on the law of passing off, the Court states that it is the "first impression" of the searcher at which the potential for confusion arises that would lead to liability. In the Court's opinion, the point during a search when the first impression is made cannot arise when the sponsored link appears. Instead, confusion arises when the searcher reaches and views a website. In this case, when a searcher reached the website of the defendant, it was clear that the website was not that of the plaintiff's. It was within the searcher's own volition to continue on the site in spite of this—or to return to the original inquiry. The plaintiff failed to demonstrate that mere application of keyword advertising by the defendant led to confusion that resulted in damage to the plaintiff.

What's Next?

This decision is of particular interest to online businesses and those who rely on online advertising. While trademark owners may argue that they are losing control of their marks, the courts, as suggested by the decision in this case, do not necessarily believe that advertisers are gaining it. This is the second decision to describe keyword advertising as fair use: the previous Canadian decision on keyword advertising went so far as to agree that the practice was no different than the long-accepted practice in traditional media of locating an advertisement close to that of a competitor.2

In a way, this ruling raises the threshold required to establish confusion caused by online advertising services. The Court did not assume the searcher was a relatively inexperienced Internet user. As online activity becomes more universal, the test person for confusion is more likely to be one who has a working familiarity with search engines and is capable of sifting through search results.3 The issue, however, remains unsettled as Vancouver Community College has appealed the decision. It remains to be seen how the courts will balance the rights of trademark owners against the fair use of strategic online advertising.


1 Vancouver Community College v. Vancouver Career College (Burnaby) Inc., 2015 BCSC 1470.

2 Private Career Training Institutions Agency v. Vancouver Career College (Burnaby) Inc., 2010 BCSC 765.

3 Teresa Scassa, Canadian Trademark Law, 1st ed (Markham: LexisNexis Canada, 2010) at 408.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.