Using your competitor’s name in Keyword Advertising: Is it legal?

We frequently get asked this question by our law firm and legal tech clients. Clients ask us if you can legally bid on competitor’s names using Google AdWords or if such is considered a trademark infringement. For example, can xyz law firm bid on “Perkins Coie” keyword?

The online digital marketing world has deemed bidding on your competitors’ names an accepted practice, with the one limitation being that the competitors’ names don’t appear in the ad itself. Using this tactic, companies are able to capitalize on their competitors’ high trafficked branded terms.

However, what does the legal community say about this? Several courts have ruled that keyword advertising is not a trademark infringement and that such practices do not lead to consumer confusion.

In Network Automation, Inc. v. Advanced Systems Concepts, Inc, the Ninth Circuit in California ruled that that search engine advertising and bidding on competitors’ names did not violate trademark law as long as you are not doing it to harm the competitor’s reputation. You also can not mention competitors’ names, products or services in your ad or on your landing page.

The judges likened bidding on competitor names to two competing companies buying billboards in the same vicinity or placing competing product next to each other on the same grocery store shelf.

Sources:

Company Can Use Rivals Trademark as Web Page Placement

Court Bidding on Competitors Name OK in AdWords as Center

Network Automation, Inc. v. Advanced Systems Concepts, Inc, in the United States Courts for the Ninth Circuit (California)