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While the Wall Street Journal (initially, at any rate) declared outright victory for Google’s AdWords service after the Court of Justice of the European Union (“ECJ” or “CJEU”) ruled that the sale of keywords to advertisers did not constitute “use” of those keywords within the meaning of the Trade Marks Directive (89/104/EEC), most of us were more cautious from the outset.

For my own part, I wrote in the World Trademark Review that:

“The ECJ specifically refers to the possibility of liability under alternative rules of law”

and in a later piece for the New York State Bar Association Section on IP wrote that:

“The CJEU’s exoneration of Google is limited to certain provisions of the Trademarks [sic] Directive. The court expressly acknowledged that other causes of action, such as unfair competition and passing off, could be viable [paras 57 and 107].” (footnotes omitted)

So it’s no surprise to now find a judgment addressing Google’s potential liability under non-registered trade mark theories.  Perhaps it’s even less of a surprise to see that the judgment comes from Paris.

In Cobrason vs. Google, Inc, Google France & Home Ciné Solutions, the Parisian Cour d’Appel has upheld a 2008 decision of the Tribunal de Commerce that Google, Inc is liable for unfair competition, misleading advertising and illegal comparative advertising after a client, Home Ciné Solutions, purchased AdWord keywords corresponding to its direct competitor “Cobrason”.  Google was found to have provided a technological contribution to Home Ciné’s infringing acts, in particular in relation to the confusion caused by the ads, which also contained the words “pourquoi payer plus cher?” (“why pay more?”).  There is a brief summary of the decision on ip-talk.eu and a more thorough discussion, including of the finding of web users’ automatic confusion, on Dreyfus.fr (both in English).

Nathalie Dreyfus’ article is interesting since she argues that this judgment goes against the ECJ’s ruling in Google France vs. LVMH.  I do not see it that way, since it was not decided under the provisions of the Trade Marks Directive but under alternate theories contained in the French civil code.  I do, however, agree that it is very surprising that there is not a single reference to the safe harbours of the E-Commerce Directive.

I would be surprised if Google doesn’t appeal this decision, even though its fine was only EUR100,000 and it may prefer to avoid a bad precedent.  In doing so, Google is likely to argue that its participation in any civil wrong of Home Ciné Solutions constitutes only “acts of a neutral intermediary service provider” that are of a “mere technical, automatic and passive nature”, so that they should benefit from the exemption of Article 14 of the E-Commerce Directive.

If anyone knows why the E-Commerce Directive was not raised, I’d be grateful to receive your insights!

I will post any further information as it becomes available.