No harm, no foul in keyword bidding for trademarks

PHOENIX (CN) — Bidding on Google keywords of an opponent doesn’t violate trademark laws so long as there is little to no risk of consumer confusion, the Ninth Circuit ruled Tuesday.

A three-judge panel decided the Accident Law Group didn’t infringe a competing law firm’s trademark when it placed bids on the law firm’s name, Lerner & Rowe, as Google search keywords.

“The Ninth Circuit’s decision correctly held that Accident Law Group’s keyword-advertising campaign—which included bidding on a competitor’s name as a keyword—was not likely to cause confusion among the consuming public,” Aaron Haar of Jaburg Wilk Law Firm said on behalf of Accident Law Group. “The decision is well-reasoned and vindicates the right of all online marketers to engage in keyword advertising online.”

U.S. Circuit Judge Ana De Alba wrote on behalf of the panel that Lerner & Rowe failed to present adequate evidence that the Accident Law Group’s Google strategy created confusion among customers.

“The evidence Lerner & Rowe had presented is so slight that it may as well have not presented any at all,” De Alba, a Joe Biden appointee, wrote in a 32-page opinion filed Tuesday morning.

By bidding on the term “Lerner & Rowe” and similar phrases, Accident Law Group is the first to pop up in a Google Search. Lerner & Rowe argued at a Ninth Circuit hearing in May that those conflicting results will confuse consumers and cause them to choose the wrong service. They provided to the court examples of customers who were confused when they found themselves calling Accident Law Group instead.

But the panel decided those examples weren’t enough to prove the defendant’s clearly labeled ads were deceptive in nature.

“Typically, instances of actual confusion present a numerator with no denominator, saying little or nothing about the actual proportion of the consumer population that is confused. In such cases, we see the tip of an iceberg and have no ability to speculate about how much lies below the surface,” De Alba wrote. “Here, however, no speculation is necessary — we can see the entire iceberg.”

Out of more than 109,000 calls made to Accident Law Group from 2017 to 2021, only 236 callers mentioned that they had meant to call Lerner and Rowe. Only 6% of online customers clicked on Accident Law Group’s Google ads when they saw them on screen in that same time frame.

“No reasonable jury would conclude that this percentage is anything but de minimis and fails to support a finding of actual likelihood of confusion,” De Alba wrote.

Lerner and Rowe disagrees.

“We do not agree that hundreds of documented instances of confused consumers fail to constitute an appreciable amount of confusion,” Lerner and Rowe attorney Andrew Gaggin told Courthouse News. “We are concerned that this ruling will open the floodgates for businesses to target competitors and gain unearned advantages at the expense of those competitors and to the detriment of consumers.”

The judges further opined that online customers, when confronted with an ad, can still clearly see where it comes from and can differentiate between it and what they searched for.

“Those accustomed to online shopping are typically savvy enough to differentiate between search engine results," De Alba wrote. “We find it difficult to believe that consumers searching for the phrase ‘Lerner & Rowe’ would not choose to click on the link that matches their search query word-for-word.”

When defending the case before the panel, attorneys for the Accident Law Group suggested that use of a competitor’s trademarks in keyword bidding shouldn’t be considered as potential trademark infringement at all, because the trademarks are never visibly displayed. U.S. Circuit Judge Roopali Desai agreed, and, in an aside, asked the Ninth Circuit to reconsider en banc a past ruling affirming that case law.

“We believe the concurrence properly questioned the wisdom of continued reliance on past Ninth Circuit precedent that deemed a defendant’s bidding on keywords to be sufficient “use in commerce” so as to trigger the protections of the Lanham Act,” Haar said.

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