By Liz Oliveira, Legal TeamOn August 1, 2008 a U.S. District Court in Minnesota held a company liable for trademark infringement when they used a competitor’s mark as a keyword to trigger an online advertisement.
Google’s AdWord program allows anyone to purchase a word or words (otherwise known as “keywords”) to trigger advertisements for the purchaser whenever the “keyword” is used in a search using the Google web browser. In this case the defendant, MTS Systems Corp., purchased the plaintiff’s trademark as a keyword in order to generate a sponsored link advertisement for the defendant’s company whenever a Google search was conducted for the plaintiff’s company. Upon learning of this transaction the plaintiff sued the defendant for trademark infringement under the Lanham Act.
The Lanham Act requires a finding that the defendant used the trademark in commerce before being held liable for trademark infringement. It was argued by the defendant that since the plaintiff’s trademark was not displayed in the defendant’s advertisement or otherwise communicated to the public, the defendant’s actions did not constitute “use”. The court disagreed with the defendant’s argument ruling that the purchase of the trademark for use as a keyword constituted use in commerce and subjected the defendant to liability. While this specific decision only applies to entities under the jurisdiction of the Minnesota Court it should be noted that this ruling represents the majority view of courts throughout the United States.
Domain owners that utilize Sedo’s domain parking services should take note of this decision. While the law is still unsettled on whether simple use of a trademarked term as a keyword constitutes infringement it seems that decisions, like the one stated above, put the trademark owner in a favorable position should a lawsuit arise. With this in mind domain owners should make sure when choosing keywords that they select terms that are generic. Sedo had taken an extra step in order to protect the interests of its customers by adopting a policy that prohibits the use of keywords that may interfere with rights of a third party. For more information please refer to Sedo’s Keyword Selection Policy available through the About Us tab on Sedo’s homepage.
Source: Sedo.com -- Reprinted with permission -- September 9, 2008