According to a blog post by law professor Michael Geist, a court in British Columbia heard a dispute between college regulator the Private Career Training Institutions Agency (PCTIA) and Vancouver Career College (VCC), which ran courses under several business names.
VCC advertised heavily, purchasing the right for its ads to appear when 7,000 terms were entered into search engines.
The PCTIA said that VCC paid for its ads to appear when people entered competitors' names in the search engine. It said the practice amounted to misleading advertising.
The court disagreed, according to Geist, despite the fact that competing colleges had complained to the PCTIA that the practice was causing confusion amongst potential students.
"The agency began to receive complaints from competitors over the VCC practice and even fielded a claim from one student who said she had mistakenly registered for a course at VCC after searching for Vancouver Community College, though oddly the registration came after a 90-minute in-person interview and the completion of an admissions test," recounted Geist, who is chair of internet and e-commerce law at the University of Ottawa.
The court said that VCC should not be prevented from using the ad-triggers because there was enough information available online to allow a potential student to distinguish one college from another.
"Where a student erroneously chooses to examine a VCC Inc. ‘sponsored link' website instead of the website of the institution they originally wanted, I am satisfied the information readily available on the various VCC Inc. websites is more than adequate to inform the student that they are examining a VCC Inc. institution and not the one they were initially searching for," said the judge, according to Geist.
Geist said that the case was the first time that the issue had been tested in Canadian courts.
Europe's highest court, the European Court of Justice (ECJ), has been asked to make a number of rulings on the trade mark implications of one company's use of another's brand as an advertising keyword.
In March the Court ruled that Google's keyword advertising system, AdWords, does not itself infringe the trade mark rights of a company whose trade mark was used by another company as a keyword.
It did say, though, that in some cases the company making use of the trade mark might infringe those rights and that in some cases the trade mark owner would be able to demand that Google prevent the use taking place.
Google only acts as an information service provider in the transaction and cannot be blamed for any trade mark infringement committed by its users.
The ECJ said that the company making use of the trade mark could only be found guilty of trade mark infringement when the ad itself caused confusion about the origin of the goods or suggested that the company was linked to the trade mark-owning company.