15 April 2014

Trademarks, brands and keyword marketing

A trade mark is a sign which can distinguish your goods and services from those of your competitors (you may refer to your trade mark as your "brand"). It can be for example words, logos or a combination of both.

Many businesses have trade marks including a distinctive word or combination of words, and some on-line retailers have been taking advantage of that by using those words to direct potential customers to rival products.

This Keyword advertising has resulted in a major legal battle between cosmetics and bath products company Lush and the online retail giant Amazon. Lush does not allow its products to be sold by Amazon, but when customers typed the word "Lush" into Amazon's search field they were directed to rival products. Amazon also ran a Google AdWords campaign so that rival branded products were displayed to customers who searched for Lush bath products.

Lush took legal action against Amazon for Infringement of its trade mark. The High Court decided the case in favour of Lush on the basis of two main issues, firstly the damage to the trade mark of Lush, and secondly the potential for the consumer to be confused or deceived.

The use of Google Adwords has been the subject of litigation before, but this is the first time that there has been a clear ruling on the use of a rival's brand in a search function or AdWords campaign.

It is now clear that if you use a competitor's trade mark in keyword advertising to direct search traffic or potential customers who search for that trade mark to your own website, then you risk having a very costly legal claim made against you for damages for infringement of that trade mark.