Germany’s Federal Court of Justice (Bundesgerichtshof, BGH) has decided that using a competitor’s brand name as a keyword in a Google Adwords list can breach German trademark law (Az. I ZR 172/11).
Google Adwords trademark infringement
The case concerned the owner of an online erotic shop called “eis.de”. The owner placed an advertisement using Google Adwords. As one of her keywords she chose “Beate Uhse”. This meant that Google displayed the following search result (translated from German) when the words “Beate Uhse” were entered:
Erotic Shop & Erotic Shop; Reductions of up to 94% guaranteed; Shop accredited by TÜV! Legitimate and discrete; Eis.de/_Erotik-Shop_&_Erotik-Shop
The proprietors of Beate Uhse, the famous chain of erotic shops, took the view that this use of their name breached German trademark law.
The BGH agreed. It drew attention to European Court of Justice case law, which classifies the use of a competitor’s brand name for advertising purposes by a business which sells similar products as a trademark infringement. The legal requirement is that the brand name has a particular notoriety which is being exploited or devalued by the competitor.
The rights of the business which has had its brand name registered as a trademark the longest take precedence.
As the defendant in this case runs an erotic shop, a trademark infringement cannot be ruled out, the BGH ruled.
The case was remitted to the Higher Regional Court of Frankfurt am Main, as the judges had failed to conduct a proper evaluation of the facts in relation to the legal elements of a trademark infringement.
Now the Frankfurt court will have to consider the case again and decide whether the trademark rights of Beate Uhse have been exploited or devalued by the owner of “eis.de”.
Google Adwords – The general legal position
It should be noted that it is generally permitted to use known brand names as keywords, provided the brand’s image and character is not devalued.
The use of the competitor’s brand name as a keyword is generally still permitted under competition law where an advertisement simply offers an alternative product to that which the trademark owner offers.