Cannot use safe harbour as a shield against trademark infringement: Delhi High Court on Google’s Ad Programme

“It is difficult to accept that Google is entitled to exemption under Section 79 of the IT Act from the liability of infringement of trademarks by its use of the trademarks as keywords in the Ads Programme,” the Delhi High Court noted in its ruling on a trademark infringement lawsuit against Google’s Ad Programme. Section 79 of the IT Act, provides social media intermediaries with protection (called safe harbour) against being held liable for any third-party information, data, or communication link made available or hosted by them. 

While the court has said that Google cannot use safe harbour as a defence against trademark infringement charges, it clarifies that it finds, “nothing illegal in Google using trademarks [emphasis ours] as keywords for [the] display of advertisements,” if there is no confusion that the links or Ads displayed are not associated with the trademark. 

Some context of the case:

The current case was a result of two appeals filed by Google LLC and Google India challenging the 2021 judgement in the case filed by DRS Pvt Ltd and Agarwal Packers and Movers. DRS and Agarwal Packers and Movers said that the use of their trademarks as keywords led to customers using third-party services, believing them to be those of DRS. The case was first brought before the Delhi High Court in 2021, where a single judge ruled that—

• The use of trademarks as keywords in the Google Ads Programme amounts to ‘use’ under the provisions of the Trade Marks Act, 1999 (hereinafter ‘the TM Act’) and thus, may constitute an infringement.
• Cannot have any right on surnames / generic words like Packers or Movers individually.
• Google shall investigate whether the use of the trademark (Aggarwal Packers and Movers) or its variations was resulting in the diversion of traffic from the company’s website to that of the advertiser. 
• Google must also investigate  the overall effect of an ad to determine whether it infringes/passes off the trademark or not
• If such an infringement is found, then Google must stop the advertiser from using the trademark as a keyword and must block/remove their advertisements.

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What did Google’s lawyers argue in the appeal?

Google’s lawyer said that the use of a trademark as a keyword didn’t constitute infringement across multiple jurisdictions including those of the United Kingdom, the United States of America, the European Union and Australia, to name a few. He said that the previous judgment was based on the use of meta tags ( words, expressions, and phrases that are put in the source code of a website to help describe its content). And that unlike meta tags, keywords aren’t embedded  into the source code. He went on to state that, “mere diversion of users from the proprietor’s website to the advertiser’s website is not actionable without establishing any confusion or likelihood of confusion on the part of the consumers.” 

And that, Google has a content-neutral role in the whole process and that its Ads Programme, “merely provides an advertising platform and interface for creating and placing advertisements on the Search Engine. Therefore, Google is an intermediary in relation to the Ads Programme.” Its role as an intermediary, he said, entitled Google to safe harbour under the IT Act and that in case an advertisement violates Google’s policies or the Trademark Act, the advertiser should be held liable. He referred to the Matrimony.com Limited v. Google LLC &Ors case (another case based on similar grounds) to support that the use of trademarked terms as keywords has been held to be pro-competition by the Competition Commission of India. 

What does DRS argue?

DRS’ lawyer said that keywords and meta tags perform a similar function and that the Keyword Planner tool (a part of Google’s Ads Porgramme), “clearly satisfies the necessary elements for infringement of a trademark,” under Section 29 of the Trademark Act. He further said that, Google cannot take the defence of an intermediary under the provisions of the IT Act since it violates the definition of intermediary given under Section 79 of the IT Act since its involvement with the ads, “is not limited to transmitting third-party information, which is temporarily stored or hosted by it, but Google selects and modifies the information and initiates the transmission.”

Details of the current judgement:

The 2023 judgement on this case was given by a division bench of Justices Vibhu Bakhru and Amit Mahajan. They have upheld the 2021 verdict and said that while Google is correct in assessing that meta tags and keywords are different, however, in the previous judgement, the judge had  referred to metatags and the decisions in cases relating to the use of metatags, “to address the contention whether use of trademarks which is not visible to the internet user may in given circumstances amount to infringement of the trademarks.” And given those conditions, the current bench found, no issues with the reasoning of the single judge. 

They further said that “A review of the Ads Programme clearly indicates that Google’s role is anything but passive. It is an active participant in promoting use of trademarks as keywords for the purpose of its Ads Programme. It actively suggests keywords that would result in the display of Ads, which are likely to result in higher clicks.” But at the same time, it said that there was nothing illegal with the use of trademarks as keywords, and that, “the facts of each case are required to be considered in determining whether in a given case use of a trademark as a keyword amounts to infringement under the TM Act.”

Google’s response to the judgement: 

According to a report by the Indian Express, Google made a statement on the judgement saying, “As a company, we comply with all local laws, and we’re pleased that the honorable court has held that Google’s Ads Trademark Policy is in compliance with the Indian Trademarks Act (TM Act) and does not amount to infringement of trademarks, unless the resulting ad upon review is held to mislead users as to the source of origin of the Ad.” 

Google also added, “we have a clear and stated [Ads Trademark] policy that does not allow advertisers to use trademarked terms in the ad-text of an ad, except in certain pro-consumer and legal scenarios, such as resellers and informational sites. And we investigate any reported use of a trademarked term in the adtext and take prompt action to not only remove such ads but block that same advertiser from referencing the trademark in their ads in the future.”