Online advertising must not overstep the mark

By Essenese Obhan, Taarika Pillai, and Shubhanshi Pohani, Obhan & Associates
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That innocuous online search for your next golfing holiday leading to a pop-up ad with a reminder that you need new polo shirts confirms that the algorithmic magic of keyword advertising has been at work.

Essenese Obhan, Obhan & Associates
Essenese Obhan
Managing Partner
Obhan & Associates

The exponential growth of online marketplaces has led to search engine optimisation (SEO) becoming a standard weapon in business marketing plans. A business wanting to top the list of search results without organically improving its SEO might choose to buy keywords from search engines such as Google. These keywords or phrases help businesses achieve greater visibility of their advertisements within specific audiences. Search engines are the typical vehicles for keyword advertising, and many, such as Google Ads, have monetised this market. Businesses can bid for or buy particular words or phrases, including registered trademarks, that guide internet users to their products or services. Entering one of these keywords into a search engine will then prompt ads from the company that selected the specific keyword for targeted advertising.

However, using a keyword that is identical or deceptively similar to a registered trademark borders on trademark infringement, as prohibited under section 29 of the Trademarks Act, 1999 (act). It can also cause confusion over the source of the goods or services offered, or even mislead consumers into believing there is an association. This disregards the purpose of trademark protection itself, which is to avoid unfair competition that may dilute its distinctive character, goodwill and reputation.

Taarika Pillai, Obhan & Associates
Taarika Pillai
Partner
Obhan & Associates

Recently, the Delhi High Court in MakeMyTrip India Pvt Ltd v Booking.com BV & Ors, held that the use of a registered trademark, specifically by competitors, as a keyword constitutes infringement. The defendants were restrained from using ‘MakeMyTrip’, with or without spaces, as a keyword in Google Ads. Noting that such use would be detrimental to the plaintiffs’ monetary interest and brand equity, the court said competitors could not exploit the reputation of a registered mark to their own monetary advantage, and that if an injunction were not granted, irreparable injury would be caused to the plaintiff, its mark, brand equity and business.

An early judgment on this issue was the Madras High Court case of Consim Info Pvt Ltd v Google India. It was alleged that infringement occurs when a rival uses a trademark in an ad title or text, and since the advertiser chose keywords using Google’s Keyword Suggestion Tool, the search engine was also guilty of aiding and abetting. The court accepted that joining two generic words, neither of which could be registered, could constitute a trademark and that Google had favoured the alleged infringers over the trademark holder. However, it did not grant injunctions as Google had given an undertaking to the same effect.

However, since then, multiple orders have been granted, restraining competitors from bidding for keywords that are identical or deceptive variants of registered trademarks. In DRS Logistics Pvt Ltd & Ors v Google India Pvt Ltd & Ors, the court held that the use of a registered trademark as a keyword would amount to trademark infringement, highlighting that Section 29(9) of the Act recognised infringement through spoken use as well, as distinct from printed or visual representation, even if invisible.

Shubhanshi Pohani, Obhan & Associates
Shubhanshi Pohani
Associate
Obhan & Associates

The court cited with approval the case of People Interactive (I) Pvt Ltd v Gaurav Jerry in holding that the invisible use of registered trademarks by non-proprietors dilutes the mark, and takes advantage of the reputation of the owner. Use of the owner’s mark and domain name in the meta tags of an infringer’s own website may divert a significant volume of internet traffic its way. The court agreed that this led to the hijacking of the owner’s reputation and goodwill by piggybacking on its intellectual property.

An online presence today is essential and non-negotiable for most businesses. Marketing and advertising strategies now incorporate the potential of technology. However, high-level principles of honest business practices remain sacrosanct even online. Trademark law may not specifically tackle the use of trademarks in keyword advertising, but the sanctity of basic principles means that courts will more likely than not rule against the use of infringing trademarks as keywords in online advertising.

Essenese Obhan is the managing partner, Taarika Pillai is a partner and Shubhanshi Pohani is an associate at Obhan & Associates.

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