Trademarked Keywords

NOVEMBER 17, 2006

A legal gray area.

By Ben Macklin - Senior Analyst

Over the last few years, there have been a variety of cases brought before the courts both in the US and overseas relating to search engines selling trademarked words as keywords. For example, is it legal for Coca-Cola to buy the keyword "Pepsi," so that every time a user types in "Pepsi" she receives the sponsored advertising listings of Coke?

The answer is that the issue is still a little gray. A recent ruling in a case brought by GEICO, a US insurance company, is illustrative. This decision allowed Google to sell the search term "GEICO" to the highest bidder, as long as the "sponsored link" that was served up with any search results did not contain the term "GEICO". For background on relevant cases, see this blog.

Google's trademark complaint procedure for US and Canadian companies includes the following statement (available here):

"When we receive a complaint from a trademark owner, we only investigate the use of the trademark in ad text. If the advertiser is using the trademark in ad text, we will require the advertiser to remove the trademark and prevent them from using it in ad text in the future. Please note that we will not disable keywords in response to a trademark complaint."

This would seem to confirm the GEICO ruling: that the text within the sponsored link is more important in terms of trademark infringement than the keyword that triggers delivery of the sponsored link.

However, this does differ from Google's statement with regard to companies outside the US and Canada:

"When we receive a complaint from a trademark owner, our review is limited to ensuring that the advertisements at issue are not using a term corresponding to the trademarked term in the ad text or as a keyword trigger."

Survey data from MarketingSherpa certainly seem to indicate that companies are becoming more aware and particular about how their trademarks are used in search marketing.

Companies, of course, have a great incentive to protect their trademarks and their overall brand. In search marketing, branded keywords are more likely to be clicked by Internet users than non-brand keywords, according to 360I.