Google filed an appeal before the Delhi High Court impugning a common judgement passed by a Single Judge Bench on 30th October 2021, stating that using the registered trademarks as keywords in the Google Ads Programme amounts to 'use' under the provisions of the Trademarks Act 1999, therefore amounts to the trademark infringement.
In the appeal, Google pointed out that it is a company incorporated under the laws of the United States of America and owns, manages and operates the Google Search Engine and the Google Ads Programme. Google India is a subsidiary of Google and is appointed as a non-exclusive reseller of the Ads Programme in India.
In this matter, DRS Logistics and Agarwal Packers and Movers Pvt Ltd., a leading packaging, moving and logistics services provider in India, claims that due to prolonged and continuous use, extensive advertising campaign, marketing network and quality control, its trademark/trade name 'AGARWAL PACKERS AND MOVERS' has acquired goodwill and reputation amongst the public and the said trade mark is a 'well-known' trademark.
Agarwal Packers and Movers accused Google's search engine of the way of functioning that when a person searches for anything by entering a specific word or set of words, it scans the database and displays the desired search results that may span several pages. The result is relevant to several factors, including the Google Ad Programme ads. They alleged that Google encourages using its registered trademarks as keywords for third parties to display their sponsored links to websites infringing on its trademarks because Google profits from persons violating its trademarks by ensuring that their advertisements are reflected on the Search Engine results page, which is displayed as a result of search queries relating to DRS’s trademarks if they pay a higher amount to display their advertisements (links to their website/webpage). DRS claims that such activities of Google constitute an infringement of its registered trademarks.
After hearing the arguments, Justice Vibhu Bakhru concluded that under Section 79(1) of the IT Act, an intermediary is unquestionably exempt from liability for any third-party information, data, or communication link made available or hosted by it; however, the said exemption is not valid if the intermediary's role extends beyond merely granting access to the communication system over which information made available by a third party is transmitted or hosted.
A restriction of liability is not applicable where an intermediary has conspired, assisted, helped, or incited the commission of illicit conduct, according to Section 79, subsection (3) of the IT conduct. Suppose an intermediary neglects to promptly remove or prevent access to the content after knowing that the information handled by the intermediary is being used to perform an illegal act. In that case, the limitation of responsibility under Section 79(1) of the IT Act is lifted.
In the current case, Google's Ads Programme is the subject of infringement charges. The Prima Facie is that Google actively participated in the infringement of trademarks by choosing the recipients of the information about the links they provided. Undisputedly, the brands are monetized by Google by using the exact keywords for displaying the paid Ads on the SERP. In one sense, Google effectively sells the use of the trademarks as keywords to advertisers.
However, it is challenging to believe that Google is entitled to an exemption from liability for trademark infringement under Section 79 of the IT Act due to using the trademarks as keywords in the Ads Programme. It is challenging to believe that Google could promote and allow trademarks as keywords, effectively charge for their service, and then argue that the data above belongs to third parties to qualify for an exemption under Section 79(1) of the IT Act.
Before 2004, Google did not consider trademarks as keywords. Still, after the amendment in the policy, it introduced the tool, which actively searches the most practical terms, including well-known trademarks as keywords.
Google operates an advertising business with extensive control over it rather than acting as a passive intermediary. Insofar as the Ads Programme is concerned, Google is not entitled to the benefits of Section 79(1) of the IT Act simply because the business above is conducted online and is integrated with its service as an intermediary.
Asserting the directives is limited by Google to the degree that they were based on the conclusion that using trademarks as keywords in the Ads Programme constitutes using them by the TM Act.
There is no flaw with the result mentioned above, and we hold that the TM Act applies to Google's use of the trademarks as terms. The Delhi High Court finds no fault with the learned Single Judge's determination that Google would not be eligible to protect Section 79(1) of the IT Act's safe harbour if it were determined that Google had violated Agarwal Packers and Movers' trademark or was jointly responsible for the violation.
