Keyword Advertising, i.e. displaying an ad based on a search for a particular keyword or phrase, is now an essential part of online marketing. Advertisers can select specific keywords or phrases that are relevant to their products or services for a fee on search engines such as google.com or list.com. When users type these keywords into a search engine, the advertiser’s ad appears among the first results. So, for example, if an advertiser sells running shoes, they might choose a phrase like “buy running shoes”. When someone searches for such a phrase, the advertiser’s ad will appear among the first search results. Keyword Advertising is thus an effective method of targeted advertising where there is a high probability that the user will be interested in purchasing the product searched for.
However, a problem may arise if another entity’s trademark or trade name is used as a keyword, especially if this entity is in the position of a direct competitor of the advertiser. Keyword Advertising based on someone else’s trademark (trade name) may fulfil the elements of unfair competition and unauthorised interference with the relevant trademark.
The above follows from both Act No. , on trademarks, and from the relevant regulation of unfair competition in Act No 89/2012 Coll., Civil Code. Pursuant to Article 8(1) and (2) of the Trademark Act, the owner of a trademark has the exclusive right to use the trademark in connection with the goods or services for which it is registered. Without the consent of the owner of the trade mark, no person may use in the course of trade a sign identical or similar to the trade mark for goods or services which are identical or similar to those for which the trade mark is registered. Case law has established that the use of another’s trademark or identical/similar sign in Keyword Advertising is an infringement of a trademark and the affected party has the right to seek judicial protection. At the same time, such conduct may be considered as unfairly creating a likelihood of confusion and reputational free-riding, whereby a search engine user may ultimately be confused between products, for example, if he enters the trade name or trade mark of the injured party in order to find the website of the injured party, but is instead offered a search result in the form of an advertisement of the advertiser who is using Keyword Advertising illegally. The user can then buy a competing product based on this result, even though he or she was not originally interested in buying it.
In such cases, the affected entity may seek, first of all, to refrain from the unauthorized use of the trademark or trade name for Keyword Advertising by a competitor, as well as to eliminate the consequences of such use, to provide adequate compensation and, where appropriate, to compensate for damages and to pay unjust enrichment. However, it is essential to learn of such unlawful interference in a timely manner. This can be quite difficult as search results may vary based on a number of criteria such as the type of device and location. Thus, while many users may see a given ad, the subject itself may get completely different results for the same keyword.
It is therefore important to be vigilant and pay due attention to the online environment when protecting trademarks and business names.
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This article is for informational purposes only and does not constitute legal advice or guidance for any particular case.