October 27, 2009
"Keyword Advertising after Rescuecom: Predictability Remains Elusive," Dorsey & Whitney LLP eUpdate
On April 3, 2009, the Second Circuit Court of Appeals ruled against Google in a much-anticipated keyword case, Rescuecom v. Google. The result of the ruling, is that most keyword-based trademark infringement cases will no longer be able to be dismissed at the motion to dismiss stage in the Second Circuit. Courts in the rest of the country that had ruled on this issue previously had come to the same conclusion — that alleging that keyword advertising was purchased or sold based on third party trademarks is enough to state a claim against Google or a competitor. Despite receiving this adverse ruling in April, in May, Google announced that it would significantly expand its keyword program in two ways. First, it would begin to allow third party trademarks to be used in the ad text of sponsored ads in the U.S. Second, it would expand the number of countries in which it allows the purchase of third party trademarks as keywords from four to 190 countries.
How can we explain Google’s seemingly incongruous behavior? And how should brand owners conduct their businesses while we await further clarification from the courts or legislature in this confused area of the law? In this article, we will discuss how we got to this point and where search engines and brand owners might take us next.
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