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Google AdWords Case Is Sadly Funny


A Judicial Comedy of Errors

Here's the understatement of the week: "This wasn't the best-argued case of the day." New York Law School professor James Grimmelmann was referring to the resurrection of computer repair company Rescuecomm's lawsuit against Google, which was dismissed in 2006, but is now up for review by a federal appeals court.

One can imagine the judges sliding spectacles to the ends of their noses, stretching out papers to arm's length and squinting, before trying to decide if they buy the argument that there is "no next to" on the Internet, and whether a search engine results page is more akin to a store shelf, directory assistance, a pharmacy, or a vending machine.

This is one of a number of important cases across the country as the legal system tries to hammer out what is and isn't acceptable in the digital 21st Century. Some offline analogies might not fly in the online world, however. Those that don't fly in this case are offered first by Rescucomm's attorney, and then by judges who seem to have relative difficulty grasping the concepts behind search marketing.

Give them a break; it's been a long time since they took their LSATs.

Rescuecomm's case revolves around the not-so-simple question of whether bidding on trademark keywords is considered a use in commerce, thus violating trademark law. Rescuecomm's (previous) argument echoed other complaints from Geico and American Airlines that competing businesses should not be allowed to target their trademarks in sponsored search ads. Yahoo and MSN, fearing litigation, discontinued the practice.

Rescuecomm's other argument though, is that when people search for a company name, they only want content from that company, not paid content from competitors or any other organization that might be targeting that keyword (like non-profits, critics, or news agencies). Google argued that it was improper to demand that all roads lead to Rescuecomm.

In an "oral argument report," Grimmelmann says the judges joined Rescuecomm in theorizing and posing hypothetical situations, one of which involves futuristic machines that, if invented, would make as much sense as Universal Music Group's latest argument that throwing away promotional CDs constitute "unauthorized distribution."

I'm putting that one on the board, too, as a contender for Not The Best-Argued Case of the Day.

The trump card in deciding whether or not the case can go to trial is whether there is potential for confusion between companies or products. This led the three-judge panel to discuss whether a sponsored ad appearing next to organic results was different from placing Pepsi next to Coke on the store shelf; or different from phoning directory assistance, asking for a company number and being given a competitor's number instead; or different from if you asked the pharmacist for Advil and were given Aleve.

Grimmelmann's account borders on hilarious. Here's an excerpt:

 

[Judge Guido Calabresi asked] What if someone types in something at an automated drug counter and a box comes out, half Advil and half Aleve? The specific request, said [Google attorney Michael] Page, made the response an implied representation. Thus, Calabresi asked, [what] is the difference between that and Google? What would be difficult about saying, “These are some other things, not directly what you asked for?” Ah, Page replied, but that’s what we do with our “Sponsored Links” text. That’s when the trap snapped shut. 

 

Hmmm. I know: What if I bought a box of Cheerios and there was Grapenuts inside? You know what Grapenuts does to my teeth? What if I confuse my Ex-Lax with my Viagra? Will I know if I'm coming or going?

Oh come on. It was wide open.

Unfortunately for everybody, this is kind of important. It seems unduly restrictive of not only speech but also of the free market to disallow competition (or competing viewpoints, if it helps solidify it for you) from appearing in the search results. What Rescuecomm and other companies want is not in the interests of protecting their trademark, but in eliminating Google's ability and right to inform consumers of other options and opinions.

Fortunately though, this comedy of judicial errors doesn't decide the case once and for all. It's just a hearing to see if there's merit to overturn a dismissal. If so, Rescucomm gets a trial and Google's legal team gets another chance to destroy a specious argument.

If you think the judges had trouble with this one, just wait until they have to learn about meta tags and whether its legal to drop in your rival's trademark in order to snag their organic traffic, too.
 

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About the author:
Jason Lee Miller is a WebProNews editor and writer covering business and technology.

Comments

anyone remember american

anyone remember american blinds this will always happen

I agree

I agree to you !!!!!

Really funny , Isn't it???

nice

Look forward to more articles from you and to find out what the other people in the law perfession think of this.

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Google has a point

In my opinion as long as the adwords advertisers link clearly says, sponsored links this should be fine. According to me competitors should be allowed to bid for trademark keywords, but should not allow those keywords to be placed in their ads.

Example if someone is searching for "Honda Cars", there is nothing wrong in allowing ford to bid for those keywords as long as their ad says, "Ford Cars". If they place an add saying, "Better than Honda Cars" then it is not right.

If the verdict goes against google, then soon someone will file a lawsuit for organic result as well. 

using tradenames in ads

So, what is your opinion (other than it's marketing suicide) for Ford's latest "We are now as good as Toyota" ads?

Steve Spence
http://www.green-trust.org

 

 

agree with it.

when people search for a company name, they only want content from that company, not paid content from competitors or any other organization that might be targeting that keyword (like non-profits, critics, or news agencies).

 

Big Fish Ad-vantage

Big fish eat small fish whole. Follow these events..

 

1) Author develops a program in 1997 and posts downloads for his freeware programs at geocities.

2) May, 2000, developer removes his very popular freeware downloads from geocities and posts a licensed/registered shareware copy.

3) Thereafter, apparently, a major publisher requests copy of freeware program from a third party and posts the program download without authorization from the developer.

4) At the major publisher site the reviewer of the freeware program includes a competitor program name within that text with a direct link to the competitor’s website.

5) Downloads exceeded 300,000, actual visits to the published post undoubtedly many times over that number, providing an independent free source and advertising link for the competitor.

6) In addition, the competitor also continues to post ads at search engines using the name of the program in the “keyword” heading of their ads—an ad that will appear with every search for the competing developer’s program.

7) Contrary to ads posted, the competitor neither provides any download copy of the popular program nor is the keyword used found anywhere at the competitor’s websites.

 

The profiteers: Search engines, the major magazine publisher, and the competitor.

The developer: .zip

 

Who are best able to dis-ad-vantage little fish? BIG FISH.

Google AdWords Case.... you can't stop others fair use

I don't think you can say to Google (or any search provider) that all roads must lead to the trademark holder. For example if I want to search for "apple ipod" because I want to shop for iPod accessories, I'm expecting that when I type "apple ipod" and hit enter I'm going to get tons of hits on any page that has those two words. It's unreasonable to expect Google to restrict the search to ONLY pages that have those words in them that are owned by the trademark holders of the word iPod. If that was the case Google would be useless for almost any search of any kind.

I'm not sure if fair use of the trademark terms would apply here. I can't see that I would have to obtain permission to use the word iPod if I were to write a blog about something and use the term iPod, like a review or how-to article. Of even if I want to ask customers, "looking for an iPod? Try our new Acme Portable Digital Media Player Model #1 instead!"

Rescuecomm can reasonably expect that Google would return Rescuecomm's website as the first result (even if they didn't pay extra for special placement or not), but they can't expect Google to block all other referances to their company or any trademarked terms.

You have to accept that in the marketplace (of the present, past, and future) that other people will use your trademark names to sell their stuff. It's just part of the way the world works. Anything that stops that from happening restricts our freedom.

Reply to Response

If you want to search for "Appl iPod Accessories", then why not type in all 3 words instead of just the registered trademarks, "Apple iPod"?  If Google allows the broader search to return results for competitors, it should be deemed a copyright violation.  Adding the word "Accessories" should limit the search to just that, accessories compatible with an Apple iPod, not competing MP3 players.  If you want to see all available MP3 Players, then type in "MP3 Players", a generic search. and you would get the results of all manufacturers, including Apple.  You will probably also get anyone who makes accessories and related items, it would just be a much longer search results list..

The generic search or the specific search would both get you the desired results if competitors were restricted from using "Apple iPod" as a paid search word for their products.  It's no more difficult for the end user than learning how to use the on-line card catalogue at a public library.

Adwords

For the last four month my ads were doing good for small money about 10USD/day but starting from last month I get no click at all for my small website because google ask me to pay 4-8 US Doller for one Click  to compete for my keyword .this is unfair from google.

adwords

one must say that the campains are getting harder to pay for.  i think that google much stop this.

Google keywords etc

What if Google disabled ALL links regarding Rescuecomm so that EVEN THEIR WEBSITE did not appear.  I wonder if they would feel "left out" of the WWW.  You can't have it all in this new world of global communications.  Either you get YOUR exposure and deal with the competition on the same level, or you step off from the world stage and go-it the pre-tech way.

Trademark Use

The law seems pretty clear on trademark use.  If someone wants to use your trademark, including your registered trade name and or logo, they have to have your permission, which you can withold or grant, without or without compensation.  It's up to the holder of the trademark.  Fair use is fair use, period. 

Using a direct competitors trademark in order to generate "optional" traffic to your site is unethical at best and illegal at worst.  Related but not competitive industries should be required to get permission to use another companies trademark, even in search engines.   They are still making money off of your company's name and reputation.  The media is different.  News coverage of sotires about your company should be exempt just as it is in print, television and radio.

Key words that are generic are up for grabs to the highest bidder and could allow competitors in the same industry to come up with paid or natural search results but specific brand or company names should remain the intellectual property of the registered owner.  No one else should have the right to use them in any capacity without permission.

Legal nicety?

I am no expert but I suspect there may be a legal nicety here that one of the legal eagles reaing this thread might comment on. Yes, the law is clear on the use by others of trademarks as far as reproducing them or publishing them publicly in whatever media is concerned. But, if I am bidding on them as keywords but not using them in my ads then they are not being seen by anyone except me and perhaps the adwords scrutineer (if such an animal exists!). Does this still constitute infringement?

My limited understanding is that basically the law is there to prevent confusion in the minds of "consumers" - so that one business cannot pass off its products  as those of another.  In bidding on others trademarked words but advertizing my own products I am not attempting to confuse the consumer I am simply ensuring my ads get shown alongside theirs.

Taking the  argument against trademark bidding to its logical conclusion one can envision search engines being found complicit in trademark violation for showing any ad or natural listing not directly linked to the trademark owner in the results for any searched trademarked word or phrase, i.e. every trademark owner would have total monopoly of results for their trademarks. Not a scenario I would welcome.

 

Easy Solution!

If Rescuecomm's so concerned about this, there's an easy solution--DON'T USE GOOGLE FOR PAID LINKS!  MSN and Yahoo don't have the same company policy, so it's not like Rescuecomm's completely shut out of the market--they have many other paid search options they can use that use an  approach that will appeal to them.

  And in all honesty, they must be doing a horrible job of bringing traffic to their site if their company's website ISN'T the first to pop up on the top of ANY search engine!  I've got a very common name--Jason Martin.  I'm a commercial artist.  I'm competing with at least two more successful/famous Jason Martins out there, one that's a comic book artist, and one that's a guitarist for some band.  I've worked very hard to make a search engine-friendly website, and typically nowadays if you put my full name in a search engine--Google or otherwise--I'm on the first or second page.  And that's with not a single paid link!  Now with those other companies that ARE big names--Geico and American Airlines, for example--they're the first ones to come up, without the help of "sponsored links" or otherwise.

What Rescuecomm and other

What Rescuecomm and other companies want is not in the interests of protecting their trademark, but in eliminating Google's ability and right to inform consumers of other options and opinions.

There is a plethora of issues here but I will try to address this one primary statement and two issues that arise from it.

first to say that "Google" has a right to inform as would any human being is not true since unlike any ole Joe  Schmo, Google has a worldwide voice that is at this point easily large enough to move economies.  Therefore Google has an obligation to preserve the strength of the market thus the economy.  As you say "on the surface this seems obvious that assisting competition (in your opinion) by allowing competitors to advertise on your trademark name will help prices go down.  When you take a closer look however you will find that like my company the company who has been victimized but the leeches will resort to higher ad costs and other security measures in an effort to protect their own name.  This is paramount to forcing you to buy home security because your neighbors keep using your home as their own.  And in the end the market will lose to higher prices.

And as an inventor and business owner I am sick of hearing about all he poor victims who claim rights to do this and that and that they are just trying to make a living (on my efforts company name and goodwill).   Ever notice that these people who change vocations like a chameleon changes colors only gripe about what is preventing them from doing x y or z?  And when they can't do whatever they want then they blame others or the government?

Here is an idea, instead of griping get off your backside and create your own company.  The people whose back you are resting on did.

As a lawyer, I like the

As a lawyer, I like the anti-Google arguments.

Google is not unfair it is

Google is not unfair it is actually very democratic and if a trademark name is targeted to create traffiic for example apple computer for people selling apple computer complementary products then it provides new possibilities in related subcategories. Google is not going to place your website next to apple in the natural search as the patents are very clear that this kind of duplication would be eliminated. Selecting Keywords and writing ads and website pages that reflect that keyword density is a job that requires human capital. We spent over 5 months of work just to get indexed for our main set of keywords that just describes the cloest match of what our product does. When we first began experimenting with keywords it was a pay per click Yahoo experiment that led to many misconceptions about how search engines actually function. Through trial and error we managed to survive and learn the new job skills required to get indexed in the main keywords and generated sales which we believe we earned in a democratic fair and impartial way. Google analytics do not reward people for keywords in the adwords campaigns that are not relevant to the page and prodct descriptions on the website. You can try to experiment with that as we did we tried a campaign with 2000 keywords which lasted about 8 hours before the price per word went up to $5 per word over the $0.10 we paid for each of them. So clearly you would end up paying alot of money to buy the word apple in an adwords campaign if you were not an apple dealer for instance. 

If we look at this case law and we have a judge tht decides a matter then some jealous party the plantiff that sued google appeals the the federal courts this may be one version of democracy but I think it is a bit disruptive. When you are in a fight like that you must reflect on what happened and realize that suing people and having such problems is never good. The jealousy that yahoo had for google was evident with some of the things they said when I had to fight to buy the keywords from them initially at 30 cents a piece. I am not claiming to be a internet webmaster but anyone that wants to figure out how google can work for them does not really get any help from google when they pay for those words. They are taking a chance that they may get less internet traffic than more. The key I think is to focus on the desire to figure out how to do some work on your website and ad campaigns that produces good results. The thret of making it a crime to pay for the word apple computer is what no one needs. These are questions of really what a trademark actually is and when you take a word like water no one can trademark the name water. So why is the word apple any different just because someone is selling computer periperals? There is no real difference and then it becomes a war of words and a drama of the courts. So if we let the judicial review of the lower court be overturned in a case like this what we are saying is that the internet is the tool of some to promote the sale of their goods just not all people. Infringment is when you sold a computer and placed the mark on the good as if you were apple computer selling an apple. Infringment is not intended to mean that if you are selling complementary items or peripherals that apple computer buyers may want to know about you cannot use the word apple in an adword campaign. The internet is really about human thought and when you are buying words or designing a webpage with good google analytics it may not be perfect it may take several months or a year to develope. Advertising helps the website whether it is paid for or free but we live in America and to control human though in such a way to say to every person on the internet that they cannot buy the word apple computer if they are not Steve Jobs or one of his employees is unconstitutional and repressive.

There are politicians like the former Prosecutor Rudolf Guiliani who think that every one that gets on the internet needs an id. What kind of freedom is that? This agenda of knowledege managment is really what this case is all about. The judges at the federal courts can damage all of our freedom to use the net with cases like this. Greed is not good but greed the want to take on Google for money is fueling the repression of the net. Everyone from facebook to yahoo and even microsoft are trying to beat google and get a piece of the pie as it were. The lawyers and the judges involved in this case are part of the real politics. They don't really care about their clients rights but they seek to control the game long term. I mean who is going to make a million dollars with the keyword apple? Why is so important to regulate human thought? It is bad enough that the patents are public and the jusges coulf bother to read them to try to geet some sense of just how fair google is as a search engine there are over 80 of them to digest. Rich with the one thing everyone fears knowledge. Unlike our books stores where you can buy fiction and some magazines.The truth that it they are only punishing themselves by paying for a keyword to begin with when all they had to do was think of google as a library index and write something good that people want to know about.

For a high court in this country to entertain such a case seriously is the marker that we are as with  this conflict in the middle east priviledged to have some  basic freedoms but that it can be taken away.

TV Commercials

i've seen pepsi use coke in their ads. i say as long as a proper royalty is paid for use of the trademark, go for it.

now, as far as the paid ads next to searches, GET OVER IT!

QQ

i think some EMO's just needed some free press again.

No-one is complaining about

No-one is complaining about organic free results, the issue here is that people are TRADING on OTHER PEOPLE'S trade MARKS.

It's akin to some little photo developer shop sticking a big KODAK sign over their shop. You 'click' that shop because you were scanning for a photo shop, thought 'kodak' and spotted one. You get closer (enter site) and find it's not really Kodak but hey, it IS a photo store. So you buy, cos you're there.

The store is not claiming to BE Kodak, they just used the word and symbol to get your attention huh?

No, that is dishonest and trading on other people's goodwill and brand recognition, ie the most expensive and valuable asset a company can have.

To say this doesn't matter or comes under free speech is to say brand names and trademarks don't matter in the first place. If you feel that way best of luck over there in Commie-Land but the rest of us are trying to earn an honest living. Triggering adverts based on other people's trademarks is simply dishonest.

B.

 

 

 

 

That doesnt really make much

That doesnt really make much sense... If you go offline and to your local photo shop you will see that they probably will have Kodak posters and stock and Point of Sale, so having it online is no different...

Even large companies, such as Kodak need other shops/stores/retailers to advertise their products and sell their products, if they stop people using the word Kodak, then they wouldnt really generate many sales...

I tried using adsense to advertise one of our websites, I couldnt use the term Nokia, which is pretty silly and pointless, if you think of the number of sites out there that actually sell Nokia products... We sell Nokia products, we sell a lot of Nokia phones, we have Nokia material on our site, including Nokia logos provided by Nokia to us, we have Nokia Point of Sale stuff sent to us each week by Nokia but we cant use the term Nokia in our adsense programme.  Thats pretty rediculous if you ask me, lol

I dont see how that is anyway dishonest or anything, does that Mean Companies like newsagents cant use promotional Coke signs even though they sell Coke products???

Companies like the Pc place that I myself havent ever really heard of just like moaning and complaining and try to make their money by suing other people... If they had their way they would eventually register the word PC and stop anyone using it... So where would it realistically end

Trading on Kodak's good name

Surely Kodak gave the guy the sign because they want folks to buy their stuff from him rather than Fuji stuff from the shop across the street? The guy puts the Kodak sign above his shop because he wants us to know that he sells quality Kodak products, not to fool us into thinking he is Kodak inc. Result, Kodak sells more stuff, the shop gets a new customer and I know what I'm going to get before I even enter the shop. Is that wrong? I thought that was the whole idea behind trade marks, reputation, marketing and stuff.

Kodak = Bad example

Kodak was not a good example, because they sell their products through distributers who are allowed, by contract, to use the company name.  However...the point is well taken.

Better example:  Suppose I run a little hamburger stand, and put a McDonald's sign out front.  People come in because they think they can get a Big Mac, but finding none, and being still hungry, they buy my Gary Burgers instead.  Is this fair to McDonalds??  No.  I've traded on their name and reputation just to get people into the store.

So long as you have a registered trade name, you should not have to worry about people using it to draw away your customers...online or offline.

Google

Google wants it both ways.  In their search engine they will happily hijack a search and send it to a competitor (for money), yet in AdWords, they refuse to let you bid on say "Holiday Inn", even though you are actually selling Holiday Inn rooms and getting a commission - not sending a Holiday Inn search to Ramada. 

ALLS FAIR IN LOVE AND RESULTS

I guess just like we have the Geneva Convention for the rules of war, we need a Results Convention for the rules of advertising.  Lets make the first rule : Realize there is competion in competion.

Both sides have legitimate concerns so we may have to see who wants to cut the baby in half and give the ruling to them.

This is just more of something to make me laugh when I see the unauthorize distribution of  promotional cds is the result of tossing them out.

 

I can't believe the fuss...

Let me put it in a format that everyone, even lawyers, can understand. 

Purchasing keywords, even competitors trademarked keywords, next to organic search results is no different then sending a sales rep to a physician and paying (or otherwise encouraging) the physician to promote your brand over the competitors.   The better you butter up the physician, the more likely they are to recommend your brand whenever the patient asks about the competiton.

Is it really that hard to understand?

I can't believe the fuss...

Your analogy might be closer to the mark if the salesrep you sent got their foot in the door by wearing the competition's trademark on their shirt.

Right on

I agree with you on this one.

No, the analogy is

No, the analogy is perfect.

The sales rep. is an advertiser, the physician is google.

The rep. pays the physician to promote cialis over viagra.

You ask the physician about viagra and he suggests cialis.

 

The  reasoning is both logical and sound.

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