EU Court Clarifies Stance on Google AdWords

(CN) - An ambiguous ruling from the European Union's Court of Justice could allow businesses greater freedom to use keywords to market themselves through search engine services such as Google AdWords.

The two-year-old case pitted UK retailer Marks & Spencer against the British division of Interflora Inc, an online flower delivery service. Marks & Spencer offers a variety of services, including flower delivery ordering online.

Using Google AdWords, Marks & Spencer was able to bid on keywords which would trigger links to their site. The company paid for keywords identical to trademarks held by Interflora, as well as variations such as "Interflora Flowers," "Interflora Delivery," "Interflora.com," and "Interflora co UK."

Alleging that use of the keywords violated its intellectual property, Interflora sued in British court.

The U.K. tribunal requested input from the EU Court of Justice, which issued a clarification to its ruling last year that advertisers who buy trademarked keywords cannot display ads which make it difficult for users to see if they sell original or fake products.

Both sides claimed victory after the court held that use of protected keywords must be evaluated to determine whether the mark's reputation is damaged by the competing ads.

"The use by a competitor of a sign identical to the trade mark in relation to identical goods or services has an adverse effect... where that use substantially interferes with the proprietor's use of its trade mark to acquire or preserve a reputation capable of attracting consumers and retaining their loyalty," the court wrote in a press release.

"Where the advertisement displayed on the internet on the basis of a keyword corresponding to a trade mark with a reputation puts forward an alternative to the goods or services of the proprietor of the trade mark with a reputation... such use falls, as a rule, within the ambit of fair competition in the sector for the goods or services concerned."

The case will now be returned to the U.K. for a ruling on whether or not Marks & Spencer has crossed this line with the ads.

Search engines have been hot topic in European courts of late. Google has been forced to defend itself in a number of privacy and similar advertising cases across the continent.

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