...pokračování
In case of using the article below, please quote directly the source in Amfiteatru Economic
GONGOL, Tomáš. The Preliminary Ruling Decision in the Case of Google vs. Louis Vuitton Concerning the AdWord Service and its Impact on the Community Law. The Amfiteatru Economic Journal. 2013, vol. 15, č. 33, s. 246-260. ISSN 1582 - 9146.
3. Implications of decisions regarding Google vs.
Louis Vuitton on the decisions of the national courts in the case of Google
AdWords
The decision about Google
vs Louis Vuitton should influence the decisions of the national courts of the
Member States of the European Union and unite the often contradictory
approaches outlined earlier. To illustrate this, let us mention here a few
examples of decisions in this matter (Drawn from reports of the German Federal
Court of Justice BGH, No. 17/2009.).
Factual basis for these disputes is the use of Google AdWords by advertisers
who have chosen keywords as signs corresponding to trademarks, if you like
names of companies without the consent of the competent bodies.
That's what happened in the case directly of "bananabay" (I ZR
125/07). The plaintiff, the owner of the trademark 'bananabay" in this
case demanded that the defendant, his competitor in the market, ought to stop
using signs corresponding to that mark as a keyword for the Google AdWords
optimized search engine. The Federal Court of Justice (hereinafter referred to
as "BGH") is also in this case referred to the Court with a request
for a preliminary ruling. It was necessary to determine whether in these cases
the third party uses the sign as a trademark and whether the use may result in
an infringement of intellectual property rights arising. Given that the Court
in this case (C-97/09) ruled only a few days after the above mentioned decision
in the matter of Vuitton, the conclusions of the decision were based on this.
The owner is entitled to prohibit an advertiser to use in advertising keywords
identical with or similar to a trademark without the consent of the owner of
the goods and services which are identical with those for which the trademark
has been registered. However, this applies only if the advertisement does not
enable an average internet user to distinguish the goods or services listed in
the advertisement originate from the trademark proprietor, eventually
economically linked subject to the owner or contrary from a third party.
Let’s mention also the case of "Beta Layout" (I ZR 30/07). This
case differs from the previous one by a protected designation, used as a
keyword, not a trademark, but the company name. It is therefore not possible to
apply to this case harmonized legislation marks but national German legislation.
The Court of Appeal in this case concluded that the defendant - the advertiser
does not violate the law to protect the name of the company, because there is
no confusion between the plaintiff and defendant, as users of search engines
can distinguish between advertising (sponsored link) and natural search
results. The BGH confirmed this decision with the Court of Appeal that the
sponsored links are visually separated from the natural search results. Because
there is not harmonized legislation in this matter, there was not filed request
to the Court. It leads to the conclusion that the protection of company names
and marks in factually similar cases may lead to different decisions. Such a
situation is certainly not a desirable state, which is to be achieved by legal
regulations. In light of the Court's decision, which affects the trademarks,
but the argument does not hold water visual distinction between sponsored and
natural search results.
Different
approaches to decision making can be observed in matters of the trade
intermediaries type of electronic auction house eBay, which is not related to
the Court's decision in the case "Vuitton", however, can give an
interpretative guide to the intervention of the functions of the mark. The use
of sponsored links was the matter of dispute in France between Louis Vuitton SA
Company and eBay Inc., which the latter one lost. EBay paid for the AdWords
service to offer users links to its auction site that sells previously
mentioned goods of Louis Vuitton SA Company. The Court considered such conduct
of eBay as free-riding on the reputation of Louis Vuitton and its trademarks
and therefore imposed eBay to pay damages in amount of 200,000 euros and for
each additional violation of the rights of the trademarks and other intangible
assets 1,000 euros. That decision is exactly the opposite of the Belgian court
decision in a similar case. Belgian appeals court last year ruled factually a similar
case between Polo / Lauren Corporation and eBay, Inc. concerning the trademark of
"Rach Lauren" and came to the opposite decision than the French
court. But I have to wait for the opinion of the Court on the business
intermediaries’ type of eBay. In 2008, the Dutch Supreme Court asked for a
preliminary ruling (C-558/08) in this case. So far, however, the decision has
been rendered.
4. Implications of decisions regarding Google vs.
Louis Vuitton on the decisions in the area of copyright protection
The conclusions
drawn from the Court's decision in the case "Vuitton" serve wider
applicability than just issues related to infringement to the function of
trademarks in connection with Google AdWords. The visual field also reaches
issues related to copyright protection. Shortly after the publication of that
decision, the Court rendered the BGH’s decision, which refers to the decision
of the Court, and deals with the protection of the copyrights associated with
the images that appear as Google search engine results.
In this decision (I ZR 69/08 Vorschaubilder, from 29. 4. 2010) the BGH
ruled that Google does not infringe copyright protection in situations when
there are previews of images that are the result of the search. It should be
noted that in the previous two cases registered under File No. 308 and 308
O42/06 O248/07, addressed to the court in Hamburg, Google disputes to view
thumbnails of copyrighted works lost. It was a trial with photographer Michael
Bernhard and cartoonist Thomas Horn. The court in these cases indicated that
the use of photographs in the previews is not by nature a new part, therefore,
must be based on the consent of the author.
The Google search engine makes it possible by entering keywords to
display Internet users the thumbnails placed on various websites Images that
are displayed as search results, are reduced to the original scale as the
previews. Previews also include a hyperlink that allows the user to access the
website where the original image is located. In order to speed up the search
process, the Google search engine periodically scans the Internet and stores these
images on their servers. This procedure allows to display the search results
almost immediately after you enter keywords into a search engine.
In this case, the artist - a painter sued Google because after entering
keywords containing her name it displayed thumbnails of her paintings that she
placed on her website. The court ruled that Google did not infringe copyright
because the artist could, by simple technical means prevent Google from
indexing her sites and thus prevent unwanted display in the search results, but
she did not do so. From the copyright protection point of view, the
argumentation is strange because the use of the work generally requires the
consent of the author. In this case, however, the author herself was expected
to prevent indexing of her own site. Therefore, it implies that the author's
consent is contained in the very publication of copyright works on the
Internet.
Programs of various companies (this program used by Google, Inc. is known
as „Googlebot“) scan the websites and create temporary copies of their content
in order to streamline the search process and the achievement of its results.
However, the authors can, through simple commands in the programming code web
sites, prevent the indexing or disable directly only indexing of images.
In the mentioned decision, the court also spoke to the situation where
the images were posted on the Internet by a third party without the prior
consent of the author. The court said that in these cases, Google was
responsible for search results only if it has been informed of such copyright
infringement and did not remedy it. Even in this case, therefore, the above
mentioned principles of liability of information society services apply, which
result from the EC Directive No 31/2000.
5. The decisions in similar cases
at USA courts
These conclusions of the BGH regarding Vorschaubilder also correspond to
attitudes of American courts. One of the most famous disputes in the previews
is a dispute between Perfect 10, Inc.
and Amazon.com, Inc. and Google Inc companies (decision no 508 F.3d 1146, 9th
Cir. 2007). Perfect 10, Inc. sued Google for alleged copyright infringement by
displaying thumbnails of photos published on the website of the plaintiff.
While the Court of First Instance vindicated Perfect 10, Inc. the appellate
court ruled in favor of Google. The Court of Appeal described the copying and
previewing of photos as "fair use." In short, the use of the
principle of "fair use" allows limited use of copyrighted works
without the necessary permission. An example of such use may be a comment to a
literary work and his criticism, used for teaching purposes, etc.
To consider it as the use of copyright works under the principle of
"fair use", an American court had to use in the case of thumbnail
images customized by the Google search engine four factors to support the
conclusion of such uses:
- the purpose and character
of the use of a work (including an assessment of whether the use is of a
commercial or non-profit use for educational purposes),
- the nature
of the copyrighted work,
- the
amount and substantiality of the portion taken, and
- the
effect of the use upon the potential market.
The conclusion of
the court in case of Perfect 10 vs. Google relied mainly on that the thumbnail
images of the original work are substantially transformed, and serves as an
electronic reference tool for public in searching. Their purpose of use is
completely different from the original. This situation is likened to a court
decision regarding the American court’s decision of parodies, whose work
generally comes in the principle of "fair use." In addition, preview
images differs from the perspective of the application of this principle by the
fact that the search engines provide a completely new way to use the Work (search),
while a parody is typically used for entertainment purposes, the same as the
original work. The conclusions of the trial were relied on mainly search
engines and social benefits of an entirely different use of the work relative
to the original.
U.S. courts in 2010
also dealt with the YouTube service of Google. Through this service you can
place video recordings on the internet. This service, however, can be exploited
to disseminate copyrighted works, which was the reason that led Viacom Company (owner
of MTV, Paramount Pictures, etc.) to sue Google, demanding a billion dollars
for that YouTube spread tens of thousands of video recordings protected by
copyright. However, the Court concluded that Google cannot be held responsible
for the content hosted by third parties through the services, unless the
specific violation in a particular case is not reported. The copyright
infringement of the YouTube service provider is insufficient because of only
general awareness of such options. Decision also states that Google does not
actively seek out illegal content. This conclusion is based on § 512 (c), (m)
and (n) of the Digital Millennium Act (DMCA), which contains a limitation of
liability of providers of online services. Viacom Company appealed against the
decision. The result of the appeal proceedings is not yet known.
Regarding disputes
of the factual basis in the use of Google AdWords, also in the U.S., Google,
Inc. was sued several times. One example is the dispute with Rescuecom
Corporation (case Recuecom Corporation v. Google, Inc., 2d 06-4881-cv, 3. 4.
2009). In this case it was the trademark of "Rescuecom" which was
used as the key word in the above Google AdWords. The court in this case
dismissed the action because of the fact that there is no violation of these
rights, because Google has that mark in commerce use. We can say that the
European Court of Justice has the same conclusion and justification as an
appeal court in that decision.
Another problem -
electronic auction can be demonstrated in terms of solving a dispute between
Tiffany (NJ) Inc. and eBay, Inc. The Court of Appeal upheld the dismissive
decision of the trial court in proceedings concerning infringement of trademark
rights by selling counterfeit goods via electronic auction house eBay. Sellers,
through eBay online auctions, offered silver jewelry under the brand name of "Tiffany",
substantial part of which (more than three quarters), were fakes. The key
question in this case from our point of view is whether eBay is liable for
complicity in the violation of intellectual property rights (e.g. by
facilitating the sale of counterfeit). Tiffany Company particularly drew
attention to the fact that eBay knew or had reason to believe that vendors
violate the trademark of Tiffany merchandise. Although the court acknowledged
that eBay had a "general awareness" of violations of intellectual
property rights, it said such awareness is insufficient to order eBay to remedy
the situation. As to be liability on eBay, it must therefore be shown that in
the particular case of trademark infringement, eBay was informed and did not
respond to this notice.
A similar case was
solved earlier in Germany between Montres Rolex SA and Ebay Inc.. As in the
case of Tiffany, there was a sale of counterfeits of original products of known
companies. Also in this case it was decided that eBay is not liable for
violations of the rights of the trademark. However, the court imposed in this
case, eBay has an obligation to prevent further violations of these rights if
it was informed about this and it should prevent the same situation from
occurring again. Therefore, the Court imposed a duty to monitor the virtual
marketplace after the operator was informed of the violations and prevent the
future sale of imitations of the product. Due to the technical complexity of
the problem and the above-mentioned principle of the EC Directive No 31/2000, the decision leads to more questions
rather than answers.
Conclusions
Designation
selected by advertisers for a keyword within the service search engine
optimization is a tool that is used to run the advertiser's display
advertising, so use "in commerce" within the meaning of the EC
Directive 89/104 on trademarks. The use of the products or services of an
advertiser, moreover, is even when a sign which was chosen as a keyword appears
in the advertisement itself.
However, the
trademark proprietor cannot oppose the use of the sign which is identical or
similar to his trademark, unless all of the conditions set out in Article 5 of
EC Directive No 89/104 and the case law of the European Court of Justice on
this article are fulfilled. According to Gielen (2010) where a third party uses
a sign which is identical with the trademark in relation to goods or services
identical with those for which the mark is registered, the trademark proprietor
is allowed to prohibit such use if it is liable to affect one of the functions
of the mark (particularly the function of indicating origin). In another
situation referred to in Article 5, paragraph 1, point. b) of this directive,
where a third party uses a sign identical or similar, the trademark proprietor
may prevent the use of that sign if there is a possibility of confusion. These
questions need to be viewed from the perspective of the "average internet user". But, who is
it? Unfortunately the European Court of Justice hasn’t specified what this term
exactly means. What can lead us is the definition of an “average consumer” as
“reasonably well informed and reasonably observant and circumspect, taking into
account social cultural and linguistic factors”. But, we should specify him
more precisely. Is he more informed, observant, circumspect than an average
consumer in general? According to the author’s opinion, the internet is very
specific space and more and more people are connected to the global market.
Maybe two decades ago the internet was just matter of experts but the
technology of internet access is so easy now that all generations of people can
use it. According to the author’s opinion it is necessary to specify the “average
internet user” as a visitor of the internet whose observance is limited by
special attributes of the internet. It is especially true in cases when
commercial connection between the trademark proprietor and third person using
keyword ads without permission is created.
The internet as an
information channel decreases the “costs of searching” in the terminology of
the economics of information. In Stingler’s model, the price for information is
created by cost of search. For consumers the cost of search may be taken as
approximately proportional number of sellers approached, for the chief cost in
time. Stingler (1961) points out limitations of advertising caused by expenses
of ads, especially in cases of goods which have a few potential buyers. In case
of using web services such as AdWords the costs of “one click” are low in
comparison with the benefits which can be made.
The influence on customers can be crucial because natural results and
sponsored links will appear at the first places of searching page. The question
(mentioned above) is whether the “average internet user” is able to distinguish
them. The connection between the economics of information and keywords
advertisement can be objective of further research.
Regarding the liability
of the Internet search engine itself, as we have seen above, the decisions of
the courts in matters of Internet search engines in the European Union vary
from state to state. For example, whereas the German courts tend to currently
access the responsibility for the outcome of the search engines more freely,
the French courts are often more stringent. Differently, we can say there is much
more liberal access of U.S. courts to this issue. The analyzed decisions of the
Court in the case of Louis Vuitton Malletier SA vs. Google, Inc. suggest
further European development as well as a series of related decisions that lead
to similar (liberal) conclusions of the courts of U.S.
References/Bibliography
Černý, M. and Telec, I., 2005.
Prodej internetového portalu. Právny
obzor, 88(2), pp.159-166.
Boháček, M. and Menčl, J,
2012. Ochranné známky a klíčová slova ve světle judikatury Soudního dvora
Evropské unie (2.část). Obchodněprávní
revue, 12(1), pp.1-9.
Council Directive 89/104/EEC
of 21 December 1988 to approximate the laws of the Member States relating to
trademarks.
Council Regulation (EEC) No
40/94 of 20 December 1993 on the Community trademark.
Council Directive 2000/31/EC
of 8 June 2000 on certain legal aspects of information society services, in
particular electronic commerce, in the Internal Market (Directive on electronic
commerce).
Gielen, Ch., 2010. Keyword advertising and
European Trademark Law, [online] Available at: <http://charlesgielen.com/2.html>
[Accessed 19 September 2012]
Goldman, E., 2005.
Deregulating Relevancy in Internet Trademark Law, Emory Law Journal, [online] Available at:
<http://digitalcommons.law.scu.edu/facpubs/68/> [Accessed 8 December
2012]
Griffiths, A., 2008. A Law-and-Economic
Perspektive on Trade Marks. In: L. Bently, J. Davis. J.C. Ginsburg, eds. 2008. An Interdisciplinary Critique.
Cambridge: Cambridge University Press, pp.241-267.
Marshall, A.L., 1998. The New
World of International Trademark Law. Marguet
Intellectual Property Law Review, 1(2), pp.1-31.
Pelau, C. and Bena, I., 2010.
The Risk Perception for Consumer Segment in E-Commerce and its Implication for
the Marketing Strategy. Amfiteatru
Economic, 12(28), pp.373-387.
Senftleben, M.R.F. , 2012.
Keyword Advertising in Europe – How the Internet Challenges Recent Expansion of
EU Trademark Protection. Connecticut
Journal of International Law, 2012 (27), pp.39-74.
Stigler, G.J., 1961. The
Economics of Information. The Journal of
Political Economy, 69 (3), pp.213-225.
Vymětal, D. and Suchánek, P., 2011. Security and
Disturbances in e-Commerce Systems. In: Procesedings
of the 10th Intetnational Conference Liberec Economic Forum 2011. Liberec,
Czech Republic 19-20 September 2011. Liberec: Technical Univerzity of Liberec.