The Judgment of the Court (Grand Chamber) of 23 March 2010 in *Google France SARL and Google Inc. v Louis Vuitton Malletier SA* (Case C-236/08) represents a pivotal moment in the ongoing dialogue between trademark law and the burgeoning world of online advertising. This landmark ruling, delivered by the Court of Justice of the European Union (CJEU), addressed the crucial question of whether the use of trademarks as keywords in sponsored links constitutes trademark infringement under Article 5(1)(a) of the Directive 89/104/EEC (now codified in Article 5(1)(a) of Directive 2008/95/EC). The case involved two separate but related actions brought by Louis Vuitton Malletier SA against Google France SARL and Google Inc. for the use of its trademarks as keywords in Google's AdWords program. The interconnectedness of these actions, ultimately heard as joined cases, highlighted the systemic nature of the issue and the potential implications for the entire online advertising industry.
The core issue before the CJEU concerned the interpretation of "use in the course of trade" within the context of keyword advertising. Louis Vuitton argued that Google's practice of selling keywords identical to its trademarks to third-party advertisers constituted trademark infringement. These advertisers, upon a user searching for Louis Vuitton's trademarks, would then have their advertisements displayed alongside, or even above, Louis Vuitton's own organic search results. Louis Vuitton contended that this practice created a likelihood of confusion among consumers, potentially leading them to believe that the advertisers were affiliated with, or endorsed by, Louis Vuitton. This, they argued, constituted an infringement of their trademark rights under Article 5(1)(a) of the Directive.
Google, on the other hand, argued that its actions were not a "use" of the trademarks in the course of trade, but rather a provision of a technical service. They emphasized that Google did not itself use the trademarks to sell goods or services, but merely facilitated their use by third-party advertisers. Furthermore, Google highlighted the measures it implemented to distinguish between sponsored links and organic search results, arguing that these measures mitigated any risk of consumer confusion. Google's defence rested heavily on the argument that the mere use of trademarks as keywords, without more, did not constitute an infringement.
The CJEU, however, rejected Google's arguments. The Court's reasoning centered on a nuanced understanding of the concept of "use in the course of trade." The Court held that the use of a trademark as a keyword in a sponsored link program, where the advertiser is seeking to attract consumers searching for that trademark, constitutes a "use" of the trademark in the course of trade. This is because the advertiser is directly using the trademark to attract consumers interested in the goods or services associated with that trademark. The Court emphasized that the advertiser's intention is to profit from the reputation and goodwill associated with the trademark, thus leveraging the trademark's inherent value.
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