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Will You Be Sued Over Your Ad Copy Usage?
Storus Corp just successfully sued another advertiser for use of a trademarked term in the ad copy. This is the first time that I have seen a company sue another advertiser directly without relying on Google as the intermediary for filing trademark exceptions.
As PPC advertisers, this affects us dramatically.
There are ads running on Google right now using the exact trademarked term. In fact, a substantial number of ads use various trademarked terms. From the people I talk to, the vast majority of them rely on Google to tell them which words they should not use. This case could set a dangerous precedent of advertiser suing advertiser and ignoring Google’s trademark complaint process.
In reviewing the exhibits of the case, it appears that none of the ad copy actually contained the trademarked term. One ad was utilizing dynamic insertion and they had the trademarked term in their keywords. This combination of events is what triggered the trademarked term to appear in their ad. The summary mentions that they were using an agency to manage their campaigns, yet it doesn’t appear that Storus involved the agency at all. I have not had a chance to talk to this agency yet or to read all of the court documents to see whether or not the agency could have been dragged into this case.
However, when you dig into this particular case and get past the trademarked keywords, it turns out that a majority of the issues stem from possible patent infringements. This case goes well beyond being a simple case about the use of trademarked terms in ad copy. However, it behooves us to review Google’s trademark system so that we all understand the full implications of trademark usage.
Google’s Current Trademark Policy
The current policy is to let anyone bid on any keyword and to use any keyword in ad copy. If the trademark owner files a trademark complaint with Google, Google will then determine if you have legal right to use that trademark. If so, then Google will not allow other advertisers to use that keyword in the ad copy; however, any advertiser can still bid on that keyword. This stems from the Geico vs Google lawsuit.
The tricky part about the policy is that keywords are generally trademarked by industry. If the keyword is not trademarked for your industry then you can often still use it. The word “apple”, for example, is trademarked for use with MP3 players, vacations, music, and a couple thousand others. However, if you are an orchard farmer, you can still use the word “apple” in your ad copy.
The Difficulty with the Opt Out Process
If you are an advertiser of a trademarked term, then you have three choices, each with their own set of difficulties.
Option 1: File the trademark exception with Google. Once the exception is granted, others can’t use your trademarked term in ad copy. However, this is not necessarily ideal. What if you are a manufacturer who doesn’t sell direct? In this case, you might want others to use your trademarked term in the ad copy since they are the ones who are pushing your goods. This is possible, but you must give each party permission to use the words and file some paperwork with Google.
A common scenario in this case is for the smaller retail stores to not bother contacting their manufacturer and asking for permission. Either they do not advertise on the keyword, or they just do not add the trademarked keyword into the ad copy. As a manufacturer, you are losing out in building your brand equity and sales by not allowing these other companies to use your trademarked term. This is also an issue for franchises. I often see hotels who want to run an AdWords campaign. However, the corporate office holds the trademark rights. In these instances, hotels who do not know how to navigate (or do not want to spend the time) the corporate office are not even allowed to use their own business name in their ad copy.
Therefore, while this option is great for companies who funnel all of their sales through their own website, do not sell through third parties, and are not part of franchises, it is not a great option for many others.
Option 2: Do nothing. Doing nothing is sometimes a conscious decision. After examining the above scenario, we can see where doing nothing can be useful. However, there are consequences as you let competitors use your trademarked name in ad copy. Imagine seeing an ad for Nike Shoes and then after clicking the ad, you end up at the Adidas website (this does not happen today between Nike and Adidas, but it did happen in the Storus vs. Aroa lawsuit).
Option 3: Sue Selectively. The question becomes: What if you want to allow everyone except a few competitors to use your trademark? Either you can go through the pain of filing a trademark exclusion with Google or you can just sue those few competitors who you do not want to use your name. Due to the cost of lawyers and the ambiguity of keyword advertising today, this is not a common scenario. However, it is a possible scenario three.
What is a Marketer to do?
It is very difficult to know that you are using a trademarked term. This lawsuit concerned the keyword “smart money clips”. Personally, I didn’t know that was a trademarked word. It was a word that I could easily have in a campaign just by mixing and matching keywords. When you mix and match keywords, ad copies, and use dynamic insertion, anything can happen, unless a third party lets you know that one of those words is trademarked.
There is a trademark search at the USPTO website. However, as trademarks are industry specific, it is very difficult to tell whether or not a word is trademarked for your industry.
Faced with the possibility of lawsuits, an agency might want to show their clients all the keywords and ad copy being used and have the client sign off that they have the right to use this information. Alternatively, an agency could insert some language into the client’s contract that states they are not responsible for any trademark defamation as a result of their marketing efforts on behalf of a client. However, while that is a useful document for an agency to have during a lawsuit, it does not protect them from being sued, nor does it instill confidence for the client.
An in-house marketer does not have many places to turn. They could involve their legal department. However, if a lawyer has to examine each keyword individually, campaigns that consisted of millions of keywords might start utilizing only a few hundred, as the keyword research costs would skyrocket.
Or, we can rely on Google, Yahoo, and MSN to help. After all, it’s our billions of dollars spent with them that are fueling much of their growth. They could take some of those funds and start determining a common ground for trademark usage and protection. At present, each of them has a different way of dealing with trademarks.
The current patched together system of trademark policies on the web makes it difficult for a trademark owner to navigate the system and easily set permissions for how their trademarks are used.
If the three major engines created consistent policies and then shared the trademark permissions between them, it would make life easier on markets and trademark owners. It might even save on overall legal costs.
If Google and Yahoo can agree to share data on a platform that does not make up most of their revenue in OpenSocial, one would think they could agree on a standard when it concerns the monetary lifeblood of their business.
Some opinions expressed in this article may be those of a guest author and not necessarily Search Engine Land. Staff authors are listed here.