In a significant setback for Google, the Delhi High Court dealt a major blow to the tech giant on Friday, August 11th, instructing it to take decisive action against advertisements that violate trademark rights. This directive was issued during a session of the High Court where a panel of judges was reviewing an appeal submitted by Google. The appeal was in response to a ruling made by the Delhi High Court in 2021, which had mandated that Google thoroughly examine whether employing trademarks as advertising keywords constituted an infringement.
Google LLC lodged an appeal against a decree issued by a solitary judge in 2021, contending that it qualifies for safeguarding as an intermediary according to Section 79 of the Information Technology Act, 2002. This specific provision extends immunity to intermediaries concerning content uploaded by third parties on their platforms, with stipulated conditions.
The panel of judges dismissed Google’s argument, asserting that the technology behemoth proposes keywords to advertisers, even those containing competitors’ trademarks. The judges referred to the Keyword Planner Tool on the platform, highlighting its capability to provide insight into rival trademarks. Consequently, the court highlighted that Google reaps significant financial gains from the sale of keywords.
Prima facie, Google encourages users for using search terms, including trademarks, as keywords for display of the ads to the target audience…It is difficult to accept that Google is entitled to exemption under the IT Act, 2002, the Delhi High Court said.
The ruling will mean that search engines like Google will need to put in place a newer system and also, deal with day-to-day complaints placed by brand owners, Nirupam Lodha, partner at Khaitan & Co., told BQ Prime after the single judge ruled against the tech major.
“Google will need to investigate and review the overall impact of an ad, that is, whether any part of an ad contains any material infringing the trademark”, he said.