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Germany: Keyword advertising with third party trademarks does not infringe if visually separated from search results

Thorsten Klinger

05 February 2013
The Federal Court of Justice has confirmed its case-law on the admissibility of keyword advertising with third party trademarks. The function of the trademark as an indication of origin is not affected if the advertisement is visually separated from the hit list, even when the search term contained a trademark and the advertisement contains only generic terms that do not make any reference either to the trademark owner or the advertiser.

The case

The plaintiff is the owner of the German word mark "MOST", registered for chocolate and truffles. In its online store www.most-shop.de it sells high-quality confectionery products.

The defendant operates an online store available under www.feinkost-geschenke.de and www.selection-exquisit.de, selling gifts, truffles and chocolate products. However, the defendant does NOT sell any "MOST"-products.

In 2007, the defendant placed an advertisement with Google Adwords, using the keyword "Pralinen" (German for "truffles") together with the pre-set "broad match"Pralines option. This option suggests further keywords; in the case at issue, inter alia, the keyword "most pralinen". Therefore, if users entered "MOST Pralinen" into the search field, the following advertisement of the defendant appeared under the heading "Ads" on the right side of the screen next to the hit list: "Pralinen/Weine, Pralinen, Feinkost, Präsente/Genießen und schenken!/www.feinkost-geschenke.de." [German for "Truffles/Wines, Truffles, delicatessen products, presents/to enjoy and to present!/www.feinkost-geschenke.de").

The plaintiff claimed trademark infringement and prevailed at first and second instance. On further appeal, however, the Federal Court of Justice dismissed the claim.

The Court's considerations

The court stated that a trademark will not be infringed if the advertisement is separated from the hit list and appears in a clearly identifiable advertising block. This also applied to advertisements which do not expressly clarify that there is no economic link between the advertiser and the trademark owner. The use of only generic terms for the products within the advertisement that was produced by the use of the search term which included a trademark did not constitute an infringement of that trademark.

The court stated expressly that this decision does not contradict the European Court of Justice's decision in Interflora according to which "the function of indicating the origin of the mark is adversely affected if the ad does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trademark or an undertaking economically connected to it or, on the contrary, originate from a third party" (decision of 22 September 2011, Interflora, C-323/09). It was for the national court to assess, on a case-by-case basis, whether the facts of the case indicated an adverse effect on the trademark function of indicating origin. 

Conclusion

This decision confirms the court`s pro-competitive case-law concerning keyword advertising, which has set pragmatic requirements for the use of third party trademarks as keywords. The court clarified that the main aspect of admissible keyword advertising is a clear optical separation between the advertisement and the search results.

Thorsten Klinger

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