For many people, Google symbolizes an open, free door to the virtual world. However, the web giant is worth billions of dollars in stock. Among its lucrative activities that are surrounding the search engine in controversy, is the Google “Adwords” service.
What is Google Adwords?
AdWords is the name of a system created by the California-based firm, which allows some ads to reach certain users based on the keywords they type.
The objective of the system is simple: companies are launching internet advertising campaigns that are focused on relevant keywords. Google then suggests the link to the advertisement when a user searches those keywords. Every time a potential customer clicks on the ad, the AdWords program collects a fee from the advertiser.
While this device seems to be a formidable and effective advertising medium, nevertheless, it seems to have had unfortunate consequences and contributed to unfair commercial practices.
Is Google Adwords sanctioned by the courts?
On March 23, 2010, the Court of Justice of the European Union reviewed the issue of accountability of the Google AdWords service. The court estimated that trade networks could benefit from the system of limited liability.
The court reasons that if the service did not endorse an active role on stored content, it can benefit from limited liability. The EU Community body did not fully address the problems, because it left much to the discretion of national courts.
The public therefore had to wait for a decision from the French magistrates.
On May 11, 2011, the Paris Court of Appeals issued a judgment that demonstrated the possibility of qualifying and validating the role of Google AdWords. It was not, however, based on the e-commerce directive Google AdWords claims.
In this case, a company named “Solutions”, which specializes in the sale of hi-fi equipment, had used the AdWords service as part of their advertising campaign. Among the chosen keywords, Solutions included the term “Cobrason”, which is the name of a competing company. Therefore, every time someone searched for Cobrason, AdWords would also connect the user to an advertisement for Solutions.
Cobrason decided to pursue legal action. They filed suit in the Paris Court of Appeals under the common law of liability, claiming both unfair competition and false/misleading advertising.
The court held that AdWords “technically contributed confusion in the public mind,” and found that the appearance of a competitor’s site when searching for Cobrason constituted misleading advertising, “potential customers are brought to believe that there is a commercial link between the websites of Cobrason and Solutions including, among others, the possibility of identical products sold, and that that the link in question presents the idea of “why pay more?”, which also can mislead users and result in diverted business.”
The Paris Court of Appeals does not comment on the application of AdWords nor on its e-commerce directive—it refers to common law discussing competition.
The Court revisited the issue on the status of Google and its service on December 11, 2013. In this case, the Court determined that Google AdWords and Google constituted a web-host, noting that it was only the advertiser that created the ad, wrote the content of the links, and chose the keywords. It also noted that the general conditions of the AdWords service contained no mention about the company taking an active role in selecting keywords or writing the advertisement’s text.
These situations can be confusing and depend on circumstances. It is important to call a lawyer who specializes in intellectual property and internet law to help with your defense if you face charges of unfair competition. Picovschi lawyers are there to support you through this process.