Your Trademark May Be Directing Customers To The Competition!

By Charles A. Hooker, Esq.

January 20, 2004

Trademark owners, try this experiment. Run a search on your trademark using Google, Yahoo or some other popular search engine. You may be surprised to find your competitors popping up ahead of you in the search results!

Keyword advertising may be to blame.

Keyword advertising (or "keying") has become a popular advertising tool on the Internet. An advertiser pays to have its advertisement appear with the search results when specific search terms are used. For example, a shoe manufacturer has its advertisement appear when "jogging" is a search term. The ad appears conspicuously on the first page, often above the listing of search results.

Some advertisers use their competitors' trademarks to trigger ads. Your experiment may have uncovered your trademark being used that way without your permission. Web visitors, using the search engine to find you or to learn about your products, are tempted to follow those ads and visit those competitive web sites first--and may never make it to your site. Potential customers are diverted away from your business, undercutting the strength and value of your trademark.

Courts are beginning to recognize that using the trademarks of others for keyword advertising may infringe trademark rights. The U.S. Court of Appeals for the Ninth Circuit recently held that a trademark owner could proceed with a case against a search engine for permitting its trademarks to be used by competitors for keyword advertising.

The message for trademark owners is clear. Keyword advertising presents a new way for competitors to poach the good will and reputation you've earned in your trademarks. If you believe your trademarks are being used unfairly, consult with a knowledgeable trademark attorney.