The French Supreme Court reaffirmed that a company is
allowed to use its competitor's trademark as a keyword in
Google's paid referencing service AdWords.
The case involved two competitors, Cobrason and Solutions, which
both sell video and hi-fi products online. When an Internet-user
typed "Cobrason" into the website www.google.fr, a
commercial link to Solutions was displayed, as well as a message
stating "Why should you pay more?". Cobrason sued
Solutions as well as Google France and Google, Inc. on the grounds
of unfair competition and misleading advertising.
The Paris Court of Appeal1 held Solutions and Google,
Inc. jointly liable on the grounds of unfair competition and
misleading advertising and awarded a total amount of 100,000 Euros
to compensate the loss sustained by Cobrason. It dismissed all
claims against Google France on the grounds that Google, Inc. was
the only contracting party and hosting provider of the website
www.google.fr and that Google France was only a sub-contractor who
assisted Google, Inc. with respect to the French users.
The French Supreme Court annulled this decision on three
First, with regard to the court's finding that Google, Inc.
technically contributed to the acts of unfair competition committed
by Solutions, the Supreme Court held that Google, Inc. benefitted
from the limited liability regime of providers of hosting services
according to Article 6-I-2 of the Law Relating to Confidence in the
Digital Economy (LCEN). This is consistent with the interpretation
adopted by the European Court of Justice in the AdWords
Second, with regard to the unfair competition claims, the
Supreme Court found that the Court of Appeal had not established a
risk of confusion between Cobrason's and Solutions'
websites. By doing so, the court implicitly stated that the mere
purchase of the word "Cobrason" as a keyword in a
referencing service was not sufficient to hold Solutions liable for
unfair competition. Unless there was a risk of confusion for the
average Internet user, unfair competition could not be
established.3 The Supreme Court further stated that soliciting a
competitor's clients was not in itself unlawful, unless it
constituted an unfair behavior.
Finally, the Supreme Court held that the Court of Appeal did not
establish misleading advertising, pursuant to one or several of the
conditions in Article L. 121-1 of the French Consumers Code.
Neither the display of a link to Solutions' website nor the
message "Why should you pay more?" were misleading and
constituted a risk of confusion as to whether (or not) the
companies were economically connected.
This decision of the Supreme Court is in line with the
interpretation adopted by the CJEU which intends to promote
competition. Although it is now clear that a company is allowed to
use its competitor's trademark as a keyword in a paid
referencing service, companies should nevertheless be extremely
careful so as to avoid confusing the average Internet user.
1 Decision of 11 May 2011
2 Decision of 23 March 2010, nos. C-236/08 to C-238/08,
Google Inc., Google France v. Louis Vuitton Malletier
3 It should be noted that French courts often consider that
sponsored links from the AdWords service do not give rise to any
risk of confusion as they are clearly separated from the normal
search results and easily identifiable, e.g. French Supreme Court,
decision of 25 September 2012, no. 11-18.110; Lyon Court of Appeal,
decision of 22 March 2012, no. 10/03392
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On 8 September 2016 (C-160/15), the CJEU ruled that the posting of a hyperlink to copyright-protected works located on another website does not constitute copyright infringement when the link poster does not seek financial gain.
The chapter on the UK summarises the IP court and litigation system in the UK, recent developments in relation to IP law and practice, the forms and availability of IP protection and trends and outlook in the IP sphere.
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