Keyword advertising featuring third-party trademarks

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In a judgment dated February 9, 2023, the Higher Regional Court (OLG) of Braunschweig held that the use of a third party’s trademark in keyword advertising may be permissible (case ref.: 2 U 1/22).

A lot of online advertising today comes in the form of what is known as keyword advertising. This is where an advertiser pays to have an advertisement appear in the list of results generated by the search engine operator when a person searches for particular keywords. The practice can be problematic, however, if a trademark registered by a third party is used as a keyword. Commercial law firm MTR Legal Rechtsanwälte, whose practice includes both IP law and trademark law, explains that this kind of keyword advertising may infringe existing trademark rights.

And yet, according to a recent ruling by the OLG Braunschweig, using a third-party trademark in keyword advertising can in fact be permissible. The defendant in the case in question was the operator of a comparison site who had made use of a prominent and protected word mark in keyword advertising. This led to the search engine featuring it as the second item in a list of search results, right behind the advertisement of the owner of the trademark, who also operated an online comparison site. The owner viewed this, on the one hand, as an infringement of their trademark rights, and, on the other hand, as unfair advertising.

While the plaintiff’s legal action to obtain an injunction and to establish liability to pay compensation was largely successful at first instance, the ruling was later overturned by the OLG Braunschweig on appeal, with the Court finding that there had been no violation of trademark rights or the corporate identifier. Accordingly, the lawsuit was dismissed.

Citing the case law of the European Court of Justice, the OLG Braunschweig reasoned that the owner of the trademark may only object to the use of a sign that is identical to their trademark if the functions of the registered mark are being undermined by the sign. This was deemed not to be the case here, since an informed internet user would be able to discern from the advertisement that the service being offered by the defendant did not originate from the trademark owner.

Moreover, it was clear from the label “Anzeige” ((ad)vertisement) above the text that this was a paid advertisement, and one which neither mentioned the word mark nor made reference to the owner of the trademark. The Court concluded that there had been no improper use of the trademark, and that the defendant’s action did not amount to unfair competition.

The team of experienced attorneys at MTR Legal advises on both trademark law and IP law.

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