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Louis Vuitton v Google

Louis Vuitton v Google – The AG’s Opinion

October 7, 2009

On the 22 September 2009 the Advocate General Poiares Maduro delivered his opinion on the question of the legality of Google Adwords in relation to EU trade mark law.  He found that Google is not infringing trade mark laws by allowing people to bid on keywords corresponding to trade marks in their Adwords service. This is an ‘opinion’ from an independent officer of the court who is not a judge and the ECJ has yet to deliver its judgment. It is considered, however, that Advocate Generals’ opinions are persuasive, with the Times noting that 80% of AG opinions are followed by the ECJ. With such a high level of co-concurrence, it is not exaggerated to take Poiares Maduro’s opinion rather seriously.

But was Maduro’ opinion ground breaking in respect of the state of EU law? Or was he taking a more conservative approach?  On the whole, with the majority of his opinion favourable to Google, he appears to be following a prudent line as the AG is apprehensive about the “unpredictable consequences” of taking an alternative view.  There are a number of referrals outstanding before the ECJ, but how far does he go in dealing with all these questions?

Limited Scope
One thing is for sure that Adwords has been a popular subject for referral to the ECJ over the past few years.. “There is an Austrian (C-278/08), a Dutch (C-558/08), a German (C-91/09) referral pending before the ECJ. In the UK, Mr Justice Arnold, in making the latest referral to the Court mid this year, explained “that there is at least a real possibility that the rulings by the ECJ on the existing references will not clearly resolve all the issues of law which arise in the present case” (para 93, Interflora v. Marks and Spencer Plc).
All of these referrals deal with the question of the legality of Google Adwords. The current AG’s opinion deals with 3 French cases which were grouped together (C-236/08, C-237/08, C-238/08), so, strictly speaking, the scope should be limited to those cases. Moreover, the current case is being brought against Google, the provider of the Adwords service. In Interflora, the case is between 2 private parties, one of which is being accused essentially of using the Adwords service to redirect interest towards their sites. The AG is analysing Google’s use of a trade mark and his finding will not unequivocally answer whether Marks and Spencer’s use of the trade mark ‘INTERFLORA’ is an infringement of Interflora’s trade mark.
Lastly, the AG emphasizes the limitations in his own opinion stating “that the Court is being asked only about the use of keywords which correspond to trade marks; it is not being asked about the use of the trade marks in ads”.

The Opinion – Technical Failing
The AG analysed the claims made in all three of the French Cour de Cassation references and gleaned the essential differences. He distinguished between the first reference (Louis Vuitton) which involved counterfeit goods and the other references (Google v Viaticum and Luteciel; Tiger v. CNRRH) comprising competitor sites, then consolidated all the questions so that he could present his findings comprehensively.

He summarised the standard conditions for trade mark infringement:  the infringer’s use of a sign and their goods and services must overlap, in the sense of being similar or identical, respectively with a trade mark owner’s sign and goods and services. Also, the ‘use’ has to be done in course of trade and there must be a likelihood of confusion on the part of the public.

But what type of ‘use’ is Google providing? The AG dissected the different types of use into 2 parts and assessed each separately for trade mark infringement: 1) the practice of selling trade marks as keywords in the AdWords facility; 2) the display of AdWords generated by a keyword search where the keyword corresponds to a trade mark.

1.    Strictly speaking, Google does not sell good or services identical or similar to the trade mark proprietors, i.e. they are not in the business of selling handbags such as Louis Vuitton. This was enough for the AG to find that the usage was not in infringement of trade mark law.

2.    However, the displayed advertisement triggered by trade mark keywords is advertising because a link is established “ between the trade mark and the goods or services advertised” (§79). But this was not enough to establish infringement. There must also be confusion on the part of the consumer. But the AG was very sure that the internet user was much more discerning than the trade mark owners had made out: “internet users are aware that they will have to sift through the natural results of their searches”. He thought that we decide on the origin of goods or services not from the results page of a search engine, but from actually leaving the page and clicking on the link provided by the search engine. On this ground, amongst other considerations, infringement was not found.

The AG’s conventional application of EU case law to this situation, where he stated that he would not depart “from the well-established case-law of the Court”, demonstrated plainly the technical failings of the case against Google; this seemingly not down to deficient argument but rather due to a rather particular set of facts. EU trade mark law was maybe not designed to apply to information service providers such as Google as they are relaying information and are not actually selling counterfeit or competing goods or services. So, on mainly technical points, Google was out of the reach of EU trade mark law.

The Bigger Picture –  Unpredictable Consequences
But beyond the technicalities, the AG took upon himself to look at the bigger picture, as much of his discussion revolved around the risk of an ‘overspill’ as a result of finding a trade mark infringement in the Google Adwords service. The AG was concerned that a decision made against Google Adwords would lead to trade mark proprietors wanting to target the natural results of the Google search engine (para 109), as there is not much difference between the two services: AdWords is clearly the commercial pillar of the Google search engine but the natural results could also be indirectly commercial, as root of the income of AdWords relies heavily on the performance of the general search facility. Also, both AdWords and natural results characteristically are the same in terms of their presentation (a short piece of text and a link).

The AG was concerned that the Court would not be able to limit the scope of the case to Adwords and that, as a result, the normal search function might be impeded by trade mark owners trying to stop anyone from using their trade marks on the internet.  The AG didn’t want to give too much control to trade mark owners, stating that the effect of accepting a trade mark infringement by Google  would provide trade mark owners with an “absolute right over whatever shown and said in cyberspace “ (para 108). Essentially the AG was balancing the consumer/ commercial interest and that of trade mark owners and in this balancing act, the AG noted that trade marks were inherently relative concepts, not equatable with traditional property rights where one has absolute rights over a physical space to the exclusion of others.

Contributory Trade mark Infringement
The AG provided a strict application of EU law that made the claims fail on technicalities. There was no desire to look purposively at the application of EU law to this specific situation. But even if Google was not directly responsible for trade mark infringement what about their contribution to such infringement? Should not that be a cause of action in itself? The AG was well aware from the outset of his presentation that contributory infringement was the right format for the Adwords set of facts. He deferred the issue to later in his discussion but unsurprisingly wasn’t prepared to make such a concession to the trade mark proprietors on this point.

Contributory infringement was not an EU doctrine and, in principle, the AG was convinced that it should not become one. He referred to the ambition of the trade mark owners, due to the difficulties of enforcing their rights on the internet, as now wanting to stop the “messenger rather than the message” and referred to cases in the US, where the aim was to ban the manufacturing of video recorders, as being most unwelcome. The AG wasn’t prepared to accept such an extension to EU law.

Where does that leave Google?
It may appear that the AG was falling down on the side of Google, but he did emphasise that although trade mark infringement did not apply to this situation, Google had not reached complete immunity. The AG applied the exemption for service providers such as Google in the Information Society Services Directive and found that although the keywords function of Google was content neutral, the AdWords side of the service was not. The effect being that Google would have exposure in this particular area of their service, and could still be held liable at national level for “civil or criminal matter[s]” (para 127).