Use of Trade-marks in Keyword Search Advertising

A number of search engine web sites, such as Google.com and Lycos.com, allow marketers to place advertisements on pages which display results of keyword-based searches.   Ad content is matched to the relevant keyword.   In 2003, this industry sector is expected to generate about $2 billion in revenue. Despite a perceived reluctance to police such matters, Google allows companies to assert "reasonable" rights to their own names to preclude third party marketers from encroaching on their intellectual property.   Recently, it acceded to eBay's request to bar the use of terms such as "eBay selling" and "eBay power seller".   The legality of using trade-marks in search terms has not yet been fully decided by the courts.   However, a liberalizing trend in the US has been taking place for a closely related issue – meta-tags.   In the 1990s, several decisions in favour of trade-mark owners focused on meta-tags, i.e. keywords chosen by web site owners for searching purposes.   This trend has apparently been arrested, notably with reference to the PLAYBOY trade-marks.   The US Ninth Circuit Court of Appeal ruled last year that the use of trade-marks in meta-tags is permitted, provided that "[t]he metatags use only so much of the marks as reasonably necessary, and nothing is done in conjunction with them to suggest sponsorship or endorsement by the trademark holder". Most court decisions relating to meta-tags concern trade-marks which are comprised of English words in common usage.   It remains to be seen whether the liberalizing trend for trade-mark usage will continue for keyword search advertising, (i) for web site content unrelated to the products or services offered by the trade-mark owner, or (ii) for coined trade-marks such as "eBay" or "Netflix". Search engines, advertisers, and web site owners are proceeding in this area with some degree of caution. For another report of the issue, please see: http://news.com.com/2100-1024_3-5065901.html. Summary by: Peter Wang