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I’ve been enjoying some discussion with another AdWords specialist (Austrotrabant) over Google’s recent policy changes and the meaning of the CJEU’s Google France and subsequent decisions.  Please go on over to http://austrotrabant.wordpress.com/2010/08/05/google-adwords-tm-policy-use-of-the-trademark-also-permitten-in-the-ad-text-of-ads-in-europe/ to have a look.

In the meantime, I’ve posted my comments below as they are fairly self-contained and might be of interest.  I’ll work out standalone posts for these topics when I get some free time!

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Hi Austrotrabant,

I agree – the policy has been liberalised to allow use of the trade mark in the body of the ad. I think this was inevitable given the ECJ’s affirmations of what constitutes “use” under the Trade Marks Directive. Whether it is wise to adopt this change before other causes of action have been decided (e.g. unfair competition, passing off) is debatable and time, no doubt, will tell. Given the ECJ’s exhoneration of Google, I don’t think it will matter whether or not the ad is permissible under arts 6 and 7. To put it another way, I think Google is trying to put arts 6 and 7 into layman’s terms (and will only (usually) refer to their policy as the standard for investigating an ad, not least because they won’t want to be seen to be exercising too much control over them) but I’m not convinced that their interpretation is right post-Portakabin. Perhaps Portakabin’s effect on those defences is a subject for another time and place.

I have another concern, particularly from a reseller’s point of view, in that I wonder whether Google has adopted the wrong test for confusion. Google’s standard, as set out above, is whether an ad is “confusing as to the origin of the advertised goods and services”; the ECJ / Art 6 ECD standard is confusion as to “on whose behalf a commercial communication which is part of an information society service is made”. A reseller could satisfy Google’s test but still fail the Art 6 ECD test. What do you think?

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Hi Austrotrabant,

The Art 6 test I referred to is from the ECD, not the TMD. I should have made that clearer. It comes from Google France and the way the ECJ got around to describing why “vague” ads *must* be found to have an adverse effect on a TM’s essential function. The reasoning is as follows:

At para 86 of Google France, the ECJ states that the Art 6 requirement (that the origin of an electronic commercial communication be clearly identifiable) is applicable “in the display of advertisements on the internet”. This confirms, or rather restates, that Art 6 gives European Internet users more protection from advertising than is given to consumers who are exposed to advertising on other forms of media.

The Court ends para 86 saying that Art 6 “lays down the rule that the natural or legal person on whose behalf a commercial communication which is part of an information society service is made must be clearly identifiable”. This is a good point to ask why the Court is talking about Art 6 at all. Either: (1) it is a separable, standalone obligation; (2) it is helpful in getting the Court to its answers to the referred questions; or (3) we will be told it’s irrelevant. Since the Court doesn’t dismiss it, and since Art 6 is not found in the referred questions, the fact that the Court doesn’t discuss issues unnecessarily (e.g. BergSpechte, paras 42-44) means the Court refers to it because it has at least some relevance to determing what constitutes infringement under Art 5(1)(a), i.e. what constitutes an adverse effect on a registered trade mark’s functions.

In para 87, the Court makes its first statement that a TM owner can prohibit an (electronic) ad based on the public’s perception of the origin of the ad rather than specifically of its goods and services (although of course they will be a significant factor elsewhere in the assessment), saying that the “proprietor must be entitled to prohibit the display of third-party ads which internet users may erroneously perceive as emanating from that proprietor”.

The “which” in para 87 refers to the third-party ads, not the goods and services they advertise, meaning that the right to prohibit certains ads comes from a finding that internet users will think the *ad* is coming from the proprietor, regardless of what else they know about the goods / services are being resold etc (which is consistent with my reading of Portakabin, in particular in relation to the relevant defenses).

The Court then uses para 88-90 to wrap up its discussion, with para 88 providing the (uncontroversial) general statement that the national Court must decide if the essential function is affected, and paras 89 and 90 providing instructions for two (non-exhaustive) instances in which the national Court *must* find a likelihood of confusion.

Para 89 is the obvious case scenario: if the national Court decides that the ad suggests an economic link (no criteria specified), the national Court *must* find an adverse effect.

Para 90 addresses a less obvious case: if a national Court finds, on the basis of an ad in its entirety (and presumably in the context as described in para 85), that it is “vague” as to whether the *advertiser* is a third party or is economically linked to the TM proprietor, the conclusion *must* also be that there is an adverse effect.

Although Art 6 could have some application to the para 89 sceanrio, it is unnecessary there. There is, however, a very nice parallel (as well as textual proximity) between the discussion over an electronic commercial communication that is “vague” as to who is repsonsible for it and the statement that such communications must “clearly identify” the person on whose behalf they are made.

Although I think it could have been stated more clearly in the ECJ judgment, it seems that, rightly or wrongly, Art 6 has introduced a new threshold to govern online TM use, beyond which a TM properitor can act. You could think of Art 6 as having created a legal presumption that legislators felt was appropriate when they drafted the ECD (a less Internet-savvy time, shall we say!). The presumption goes as follows: electronic ads which do not clearly identify the advertiser responsible for them (national Court question) are presumed to make average Internet users (as they were understood by the legislators of the ECD) unable to discern the origin of the ad – and therefore, so the presumption goes, of the goods and services offered – so that the essential function of the mark being used is adversely effected. I haven’t read it yet, but is that consistent with the Austrian Court’s June finding in BergSpechte?

I’m not sure that this reflects reality (the Rosetta Stone AdWords case (Eastern District of Virginia, April 29, 2010) says consumers aren’t confused by sponsored ads), but that appears to have been the intention of Art 6 when it was drafted.

By going back to basics and focusing on the intention of the legislators, the ECJ also appears to have opted for a less expansive reading of Section 4 ECD as well (the safe harbours). I’m looking forward to the arguments that will follow on those questions!

Best wishes,
Gareth

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