Interflora has won its long-running legal battle against Marks & Spencer after a judge ruled that the high street giant had infringed Interflora’s trade mark via its use of the Google Adwords system.
Googles Adwords allow entities to buy online ‘placed text’ advertising that is not visible to the internet user but which drives traffic to a sponsored link when people search for phrases related to that company’s offering.
Up until to 2008 Google had retained a policy which prohibited advertisers from bidding for other companies’ trade marks for use in their own adwords. However, in 2008 Google changed this policy and M&S bought several of the florist’s trade marked key words and phrases for its own Google adwords. As a result, consumers searching “Interflora” on Google were seeing a sponsored link advertising an M&S Flowers website.
Interflora argued that due to M&S appearing in ‘Interflora’ search results, internet users may infer that M&S was part of the Interflora network, even though there was no mention of Interflora in the advert visible to the internet user. It said that this effectively re-directed business to M&S that might otherwise have gone to Interflora. Presumably that thought never entered M&S's mind.
There is, of course, nothing wrong with seeking a competitive advantage within the confines of the law. It has taken several judges some time to decide whether M&S was doing anything legally wrong as the case has bounced around the Court of Justice of the EU and the UK Court of Appeal before returning to the High Court for trial where Mr Justice Arnolds’ ruling confirmed that the use by M&S of Interflora’s name in its Google adwords did amount to trade mark infringement. You'll note we haven't used the word "final"; the case may yet visit the Court of Appeal again.
Rhys Hughes, President of Interflora British Unit, said “Keyword advertising is a very powerful tool and so it is vital for consumer protection that internet search results take consumers directly to the brand they are looking for…. This ruling helps ensure that when consumers search on the internet for “Interflora”, they can be confident in knowing that the flowers bought online come from a member of the Interflora network.”
The parties will return to Court later in the year to decide upon the damages payable by M&S to Interflora.
The impact of this case is likely to be far reaching in relation to online advertising, especially as the practice of using a competitor’s name in a Google adwords advert is fairly common. As a result, we anticipate that brand protection and brand development are likely to take on a significantly greater importance for many businesses as they will now have to rely on their own goodwill and reputation and shall not be entitled to piggyback on that of their competitors.