UK-based Lush was successful in convincing the court that Amazon had infringed its trademark by returning results for the term ‘Lush’ in its search function, despite not selling any Lush products.
Lush also claimed that, through the use of Google AdWords, a person searching for “Lush bath products” would be redirected to the Amazon website where they would be shown alternative products. In its defence, Amazon contended that advances in search engine technology benefited consumers and shouldn’t be constrained by IP rights.
Judge Baldwin wrote: “In my judgment, however this right of the public to access technological development doesn’t go so far as to allow a trader such as Amazon to ride rough shod over intellectual property rights, to treat trademarks such as Lush as no more than a generic indication of a class of goods in which the consumer might have an interest.”
This was a meaningful victory for small online retailers as it does increasingly feel that there is an unnerving wave of “Piracy Capitalism”, (to coin a phrase from Lush owner Mark Constantine), which is a very real threat to small businesses in the UK, including my own. To explain how this looks and feels from a small business owner’s perspective, Google with its majority share of the search engine market, provides an entry point to access websites, so customer’s looking for certain brands are likely to type that name into its search engine and expect to be directed to it.
Assuming that the company’s brand name is relatively well established and indexed on the search engine it will be generated as a result and hey presto you have found what you were searching for. However, in steps Google AdWords, this is Google’s online advertising service that places advertising copy at the top or bottom of, or beside, the list of results that Google displays for a particular search query.
AdWords has evolved into Google’s main source of revenue with Google’s total advertising revenues at USD$42.5 billion in 2012. AdWords offers a pay-per-click service, whereby businesses can select keywords that when searched, their company adwill be generated, looking very similar to any other generated search result. The stinger for small business here is that Google allow companies to use trademarked terms as keywords (no doubt a key ingredient in it’s brilliant revenues).
So what does this mean in practical terms for small businesses? Well, taking my own for example – I run a small online arts business called New Blood Art, which I have been operating for a decade. I have a fairly small but strong client base, which I have attracted gradually over the years.
In the last 2 years some major players have joined the market with some serious backing and a substantial budget for their Adwords campaign and one of the search terms of which they are using is my trademark “newbloodart’ so now when you search for ‘newbloodart’ or ‘New Blood Art’ in a Google search engine the first link you see (as pictured above) is my heavyweight competitor Saatchi Art, who are paying per click for the use of my trademarked brand name.
Of course if I had an equally large marketing budget I might consider going head to head and using their brand name as a keyword search (the Google accountants would certainly be happy if we all did) but that’s neither feasible nor appealing, so unfortunately what actually happens is that business is hijacked from us by larger players who pay Google for use of our intellectual property, of course, to add insult to injury our revenue drops.
And so this was a great victory for Lush and a wonderfully hopeful result for the rest of us smaller online retailers across the UK who couldn’t dream of taking an Internet giant to court do defend our trademark.
Currently Google make it very clear what their position is on the use of competitor trademarks as keyword search terms in their AdWords Trademark Policy saying: “Google will not investigate or restrict the use of trademark terms in keywords, even if a trademark complaint is received.”