In pursuit of search engine optimisation, the popularity of keyword advertising as a marketing tool has grown considerably in recent years. Sponsored links and pay per click are viewed as essential for many online businesses and provide considerable return on investment. However a recent action has questioned whether some of these sponsorships are legitimate under trade mark law.
Google's change of policy on the sponsorship of keywords in 2008 has meant that third parties now have the right to bid for trade marks as keywords. While Google retains control over the advertising content, the practice remains contentious.
In what could prove to be an important test case on how UK trade mark laws apply to this type of keyword advertising, Interflora, the world's largest flower delivery company, has alleged that Marks and Spencer has breached trade mark law by sponsoring the word "Interflora" as a search engine keyword. Interflora is seeking an unspecified sum in damages together with an injunction to prevent repetition of the alleged breach. Flowers Direct Online, another UK internet flower delivery service, is named as second defendant.
M&S and Flowers Direct are accused of bidding for the words "Interflora", "Intaflora", and "Inter-flora" in Google's AdWords programme. This means that when users search for these terms, advertisements appeared for both M&S and Flowers Direct as sponsored links.
Interflora claim that where a user enters the term "Interflora", or a similar spelling, it is their intention to access the services of Interflora or one of its associated companies.
The allegation centres around a breach of both sections 10(1) and 10(3) of the Trade Marks Act 1994 The first of these relates to a situation where a party makes use of a sign that is identical to that of another's trade mark, in the course of trade, in relation to the provision of identical goods or services offered by the registered trade mark proprietor. A breach of section 10(3) may occur where the use of a sign in the course of trade which is similar or identical to that of a trade mark proprietor takes unfair advantage of, or is detrimental to, the distinctive character or reputation of the trade mark. Perhaps importantly, neither section requires proof of confusion.
Interflora alleges that the defendants' use of Interflora's trade mark is detrimental to their business as they argue there will be a dilution of the distinctiveness of their trade mark, which will reduce its ability to distinguish Interflora's goods and services from those of others. Similarly, in using the trade marks, Interflora claims that the defendants are benefiting from the reputation of the Interflora mark, and thus gaining an unfair advantage. Interflora's marketing director has indicated that the company views its brand as its most valuable asset, and although the company has always taken steps to protect its brand, this case marks the beginning of a long-term strategy to protect its intellectual property rights.
M&S, for their part, has stated that the company was extremely surprised by the stance taken by Interflora, outlining that the practice is an industry-wide one, and is not illegal.
It remains to be seen whether sponsorship of third parties' trade marks as keywords in this manner will continue to be a useful, albeit controversial, marketing tool or whether the UK courts will adopt a more protectionist stance in favour of brand owners. It is likely that a central issue will be whether the use of the Interflora mark by M&S will be deemed 'use in the course of trade' under the Trade Marks Act, or whether such use is found to affect the function of the Interflora trade mark.
James Monteforte is a solicitor specialising in intellectual property law at leading UK law firm Shepherd and Wedderburn LLP.