Class action law suits are US legal cases in which many
companies or people in a similar position band together to
collectively sue a company. A company called Firepond has sued
Google and wants other companies who believe their trade marks have
been violated to join it in one big case.
Firepond, a small sales process software company, has sued
Google, claiming that its AdWords system infringes its trade marks.
AdWords allows companies to pay for certain keywords to trigger
their own adverts, which are displayed alongside in Google's search
engine results.
It is also seeking to turn its case into a class action suit,
whereby a court lumps together many very similar cases against the
same defendant for efficiency's sake. Payouts are then usually
split between the lawyers running the case and the many
defendants.
Firepond has sued not just Google but also its online video
subsidiary YouTube, AOL, MySpace, Turner Broadcasting and
Interactive Corporation because these companies use Google's search
engine and AdWords system on their own sites.
Trade mark rights in keyword advertising systems have been
controversial for some time around the world. Google used to only
allow other companies to bid to have their ads displayed beside
trade marked keywords in the US and Canada.
It expanded that policy to cover the
UK and Ireland last year, and to cover a further 190 countries
earlier this month. The UK and Ireland are the only European Union
countries in which any trade mark can be bought as a keyword by any
company.
"Google has improperly infringed [Firepond's] 'Firepond' Marks
by selling, for example, [its] trademark 'Firepond' to [its]
competitors as a keyword so that when an Internet User searches for
'Firepond' on...Google's Internet search engine, the competitor's
advertisement hyperlink will appear at the very top and/or on the
right side of the first page of search results…thereby confusing
Internet Users and diverting a percentage of such Users from
[Firepond] and enjoying and benefitting from all the goodwill and
'buyer's momentum' associated with [its] valuable trademark," said
Firepond's suit.
"[Google] profit[s] financially from infringing upon…protected
trademarks and assisting and encouraging third parties to do so as
well," said the suit, which was filed this week in the US District
Court for the Eastern District of Texas.
The suit said that "the so-called 'Sponsored Links' do not
always clearly identify themselves as advertisements", and that
users are "duped into clicking through to a competitor's Sponsored
Link".
Trade mark law expert John Mackenzie of Pinsent Masons, the law
firm behind OUT-LAW.COM, said that Firepond may have difficulty in
establishing the basis of a class action suit, which depends on all
the suing parties facing the same problem.
"Each individual trade mark infringement will be different and
it will be difficult to make a case," he said. "A brand such as
Kodak is famously distinctive, whereas brands made up of common
words will be in a different situation. Kipling will be different
again because it is a personal name, a brand and it has products
which will be sold by other people, who will have a legitimate
reason to use it as a keyword," he said.
Mackenzie did say that, despite the difficulties, the most
effective way for brand owners to tackle the keyword issue is in a
class action law suit. "The courts in the US are split on the
issue, some think buying a keyword is trade mark use, some think it
isn't. There hasn't been a fully fought trial on this, and it is
about time there was," he said.
French courts have previously backed trade mark holders' claims,
and ruled as recently as February of this year in favour of two
travel companies who claimed that Google's sale of their names as
keywords was trade mark infringement.
The European Court of Justice has been asked by the German
Federal Supreme Court whether the purchase of keywords in
advertising systems counts as a use of a trade mark that could lead
to infringement proceedings.
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