An Indian court says Google can be liable for selling rivals a brand's name

Competitors bidding on the trademark “Hindware” as a search advertising keyword caused brand searches to display sponsored links to rival sanitaryware brands. The Delhi High Court found that Google was liable for allowing rivals to bid on the trademark and permanently restrained Google from offering the mark as a keyword. The court ordered Google to pay damages to Hindware Limited. The court rejected the argument that keyword reservation makes liability solely the advertiser’s responsibility. It found that Google suggested trademarked terms through its Keyword Planner tool, ran the auctions that priced those terms, and earned revenue from clicks triggered by the keyword. The court held that using a mark as a keyword amounts to using it “in advertising,” even if the word does not appear in the ad itself.

"The Delhi High Court held that letting competitors bid on the trademark 'Hindware' as an ad keyword is infringement, and that Google's safe-harbour shield does not cover it. The business of search advertising rests on a quiet assumption: that a platform can auction off any word, including someone else's brand name, and treat the legal consequences as the advertiser's problem. The Delhi High Court has just rejected that assumption."

"Justice Mini Pushkarna held that Google is itself liable for allowing rivals to bid on the trademark “Hindware” as an advertising keyword. The court permanently restrained Google LLC and Google India from offering the mark as a keyword and ordered them to pay Hindware Limited, an Indian sanitaryware maker, ₹30 lakh, about $31,600, in damages. The sum is nominal. The reasoning is not."

"Google's defence was the familiar one: it merely reserves keywords, and any use of a trademark is down to the advertiser who bids. The court was unpersuaded. It found that Google actively suggested trademarked terms through its Keyword Planner tool, ran the auctions that priced them, and earned revenue each time a user clicked a sponsored link the keyword had triggered."

"On that basis, Justice Pushkarna held that using a mark as a keyword amounts to using it “in advertising,” even when the word never appears in the ad itself. The most consequential part concerns safe harbour. Under Section 79 of India's IT Act, intermediaries are shielded from liability for what users do on their platforms."

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