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Use of Trademarks For Online Marketing – Interflora v Marks & Spencer

Wednesday, 5 December 2012

Businesses using online advertising to attract new customers should ensure they are familiar with the law relating to trademarks. Tools such as Google AdWords can be a great way to market online while managing costs but care must be taken to avoid abusing trademarks belonging to others and to protect trademarks that belong to you.

The case of Interflora v M&S provides some useful guidance on the use of trademarks in the context of Google AdWords and similar marketing services.

Facts Interflora v M&S
Google AdWords activate when users enter ‘keywords’ into Google’s search function. The AdWord search results for that keyword are displayed as adverts in the ‘sponsored links’ section of the search page. The displayed adverts belong to those sellers that have bid the highest prices for the relevant keyword.

In the Interflora case, M&S was advertising its flower delivery service on the Internet. As part of its online marketing campaign it had bid on various keywords using the Google AdWords system. One of the keywords that it had bid on was ‘Interflora’. Interflora is the name of a flower delivery network and is also a registered UK and Community trademark. Although Interflora delivers flowers for numerous independent retailers in the UK, M&S was not part of its network.

Interflora sued M&S and the High Court referred several questions to the European Court of Justice.

ECJ Ruling
In the run up to the Interflora case there had been a number of cases that considered the use of trademarks as keyword searches by third parties. The ECJ noted that those cases did not necessarily prevent a trademark being used as a keyword by parties other than the owner unless it had an ‘adverse effect on one of the functions of the mark’.

Origin function
According to the ECJ, if internet users that were "reasonably well-informed and reasonably observant" were incorrectly led to believe that M&S's flower delivery service was part of Interflora's commercial network, then the origin function should be found to be adversely affected.

Advertising function
The ECJ stated that the mere fact that a trademark owner had to "intensify its advertising in order to maintain or enhance its profile with consumers is not sufficient basis, in every case, for concluding that the trade mark's advertising function is adversely affected".

Investing function
The ECJ defined this as an ability, "to acquire or preserve a reputation capable of attracting consumers and retaining their loyalty". It suggested that proprietors could prevent competitors interfering with this if the interference jeopardised their reputation. However, where a competitor used a trademark as a keyword and this simply caused customers to switch, it would not be enough to be a breach.

The ECJ also noted that protections exist to prevent free-riding, tarnishing and diluting of trademarks.

Using trademarks as keywords carries significant commercial risk. Rollingsons recommends parties seek advice before using trademarks as AdWords or similar. Equally, proprietors should ensure that their trademarks are not being abused by other commercial entities. At Rollingsons we have experienced lawyers who can assist you. For more information please contact James Crighton via e-mail or by telephone on 0207 611 4848.