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Despite this morning’s signing into law of a landmark healthcare bill in Washington, and last night’s news that Google has begun redirecting Chinese surfers to its Hong Kong-based search engine, this morning’s ECJ AdWords ruling has received some prominent media reaction on this side of the Pond (although not half as much as there would have been had the outcome of the references been different!). The Technology section of the New York Times led with an article informing the reader that “Europe Says Google Can Sell Trademarks but at a Risk of Suits“, while the Wall Street Journal dispensed with clarifications to offer a simple proclamation: “Google Wins EU Ruling on Ad Keywords“.  The Washington Post article “European court rules Google’s ad model is legal” (via Reuters) drew attention to the ongoing arguments regarding Article 14, saying that:

“National courts guided by the principles in Tuesday’s ruling will also have to decide whether in fact Google, eBay and others are as passive as they appear to be in the administration of their automated services”.

CNN’s article, “Keyword ad buyers beware“, took the view that the “big losers” in the ruling are advertisers.  A second article in the Washington Post (“Luxury industry says EU ruling limits Google ads“, via The Associated Press) queries the impact the ruling will have on trademark infringement within the European Community, given that most infringing goods do not originate in Europe but are imported.  Harjinder S. Obhi, Google’s senior European litigation counsel, reiterates the point he made at the recent UCL IBIL seminar (noted by the IPKat team here) that “trade mark rights are not absolute”, and there has been some speculation as to whether Google will now align their AdWords Policies in all Member States to those already in existence in the UK and the Republic of Ireland.

There are some very interesting differences in the way these reports treat the decision.  Whereas the NY Times says:

“The European Union’s highest court on Tuesday gave Google broad latitude to sell advertising linked to trademarked names like Louis Vuitton, but said the search engine might have to do more to protect brand owners from infringements arising from the practice”,

the WSJ has a rather broader and less nuanced view of the judgment, saying that:

“The European Union’s highest court ruled Tuesday that Google Inc. has the right to sell ads linked to the Louis Vuitton name and other famous brands, a landmark judgment that clears search engines of trademark liability in Europe and protects a crucial revenue stream.”

(It is estimated that approximately 98% of Google’s $23bn annual revenue is derived from advertising.)  The Washington Post says the Court’s interpretation of Art. 14 is a “new” test for service providers such as Google, while CNN sets out a three-point summary of the decision, suggesting how it is likely to impact search engines and advertisers generally, and drawing particular attention to LVMH’s position that:

“any use of a trademark as a keyword by an advertiser will automatically cause sufficient consumer confusion to bring about liability under the court’s definitions”.

Two other points of interest struck me.  The first is that most of the non-party quotes come from lawyers based in London (where Google’s policy is unlikely to change as a result of this ruling) and not France (where Google’s policy might well change).  The London law firms represented in the articles mentioned above are Allen & Overy, Ashurst, Marks & Clerk, Pinsent Masons and Taylor Wessing.  Lawyers from the continental offices of Clifford Chance and Linklaters are also mentioned.  The second is that while both Google and LVMH claimed victory this morning, LVMH’s (NASDAQ) shares are up almost 1.5% while Google’s (NASDAQ) shares dropped sharply when the markets opened this morning and have continued to drop throughout the day.  As I write this, they are down just over 2.25%.  No doubt the largest proportion of this movement is attributable to the anticipated impact of Google’s move away from direct interfacing with the Chinese market, but I also wonder whether the lack of a clear “win” for Google on the Art. 14 point is being seen as having negative implications for the (lucrative) YouTube arm of their business.

I will continue to be on the look-out for any other interesting reports about the decision in the US, but suspect that that may be it until the Parisian Courts apply the ECJ’s ruling.  In the meantime you can review the IPKat rapid response seminar, which I helped house in the London office of Ashurst, here.

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