Interflora to sue over Google AdWords tactics
10th December 2008 5:37pm by Mother Superior posted in archivedInterflora has become the first trademark holder to challenge Google’s Adword policy of allowing companies to bid on rivals’ trademarked terms. The US flower delivery giant has issued a lawsuit in the UK courts citing the UK Trade Marks Act as its justification.
Interestingly, it is not Google that Interflora is suing but two British companies who have been bidding on the ‘Interflora’ trademark. Apparently, the suit argues that sections 10(1) and 10(3) of the Trade Marks Act 1994 are being breached by Marks & Spencer and Flowers Direct because they have been bidding on the Interflora name and appearing as ‘sponsored links’ on Google searches of ‘Interflora’.
Although it has taken over six months for Google AdWords to spark this legal battle, it is not surprising that it has come. Since the early weeks of the year firms have been screaming that the considerable money they have spent setting up and developing their brands would be devastated overnight by Google’s money making antics.
What is surprising are the targets for Interflora’s wrath. Most industry commentators expected companies to attack Google for establishing the profit generating system that disregarded trademarks but Interflora has chosen to go after the rivals using the system instead. The key, experts suggest, is cost and the fact that it is cheaper to try and scare opponents out of bidding than to instigate a full scale legal battle with Google.
So the suits are likely to just be scare tactics but if they were to go to court the legal conclusion would be of huge importance. Ultimately, it would come down to a decision on whether bidding on a term on an internet search engine is the same as commercially using the term.
If the judge agreed with Interflora Google would be stripped of its lucrative strategy and a bit of its aura of infallibility, while companies would have to revert to old AdWord bidding strategies. However, if the suit was cast out Google would kick back and relax as firms continued to piggyback each others’ brands.
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It makes life much more interesting when businesses can bid on each others brands. I suppose it promotes competition and keeps market leaders on their toes. Fun and games!
Google developed the confidence to go ahead with its AdWords change after Yahoo won a similar court case back in March. The High Court ruled that it was acceptable for Yahoo to display ads for Sainsbury’s supermarket when another company’s trademark was entered as a search term. Crucially, the court determined that plain English words were being sponsored by Sainsbury’s not a specific trademark. However, it was inevitable that Google would be challenged. It is just likely that it will win.