Following its nuanced August 2023 ruling on keyword infringement in Google LLC v. DRS Logistics (P) Ltd. & Ors. (‘DRS order’ – previously reported by us here), in a decision dated September 6, 2023, the High Court of Delhi has refused to restrain third party use of insurance policy aggregator Policybazaar’s trademarks as keywords. In a suit filed by Policybazaar Insurance Web Aggregator (‘Policybazaar’) for trademark infringement and passing off, the court re-emphasised that use of a competitor’s trademarks as keywords to trigger advertisements in response to search engine queries is not infringing in the absence of confusion, unfair advantage or dilution of the trademarks involved. Remfry & Sagar represented both Acko and Coverfox in these proceedings (Policybazaar Insurance Web Aggregator and Anr. v. Acko General Insurance Limited and Ors. and Policybazaar Insurance Web Aggregator and Anr. v. Coverfox Insurance Broking Pvt. Ltd. and Ors., CS(COMM) 259/2019 and CS(COMM) 260/2019, 2023 SCC OnLine Del 5523).
Factual Matrix
Policybazaar filed two separate suits alleging trademark infringement and passing off in 2019 against Acko General Insurance Limited (‘Acko’) and Coverfox Insurance Broking Pvt. Ltd. (‘Coverfox’). Acko is a renowned digital insurance company in India and Coverfox is an insurance aggregator. The suits were filed as Acko and Coverfox were using the Policybazaar trademarks as keywords (through the Google Ads program) so as to trigger their own advertisements when a consumer entered the word ‘Policybazaar’ during a Google search. Policybazaar alleged that such use was leading to customer confusion, dilution and diversion of internet traffic to Acko’s and Coverfox’s websites which led the latter to gain an unfair advantage. Further, Policybazaar was now required to accept an increased cost per click on the Google Ad program for prominent display of its own website in the search results. Google India Private Limited and Google LLC (collectively, Google) were also arraigned as defendants in both suits given that the Google Ads program is offered by them as an advertising service.
The collective defence put forth by the defendants was as follows:
-
- Policybazaar had concealed that it was availing the Google Ads program to bid on Acko and Coverfox’s trademarks as keywords which disentitled it to any discretionary relief;
- use of a trademark as a keyword for triggering sponsored ad results does not amount to ‘trademark use’ under the statute as the trademarks do not perform any source identifying function at the back end. Thus, keyword use is not infringing;
- a finding of confusion must be based on an analysis of the text of the triggered ads and whether the text features third party marks;
- mere diversion of consumers to their websites is not actionable in the absence of any confusion or actual likelihood of confusion; and
- persons using the internet are presumed to be internet literate and have a basic understanding of how a search engine and its results work. Thus, they are unlikely to be confused about the source of an advertisement that is clearly marked as a sponsored ad.
Initially, in 2019, Policybazaar was able to secure an ex-parte order of interim injunction against Acko and Coverfox restraining them from using the Policybazaar trademarks as keywords. However, the said order was subsequently suspended on applications moved by Acko and Coverfox arguing that Policybazaar had concealed an important material fact – prior to filing the two suits in question, Policybazaar had itself been bidding on the trademarks of Acko and Coverfox as keywords. While suspending the order of injunction, the court had also imposed costs on Policybazaar.
Court Ruling
After hearing detailed arguments, including a catena of international jurisprudence, the court dismissed Policybazaar’s applications seeking injunctive relief against Acko and Coverfox. On the key questions of law involved, the single judge was aligned with the DRS Order and held that:
-
- third party use of trademarks as keywords to trigger display of advertisements (Google Ads) constitutes use in advertising under the trademarks statute; however, as the keyword does not perform any perceptible, source identifying function at the backend, its use does not inherently infringe unless the Ad leads to confusion, unfair advantage, dilution, or compromise of the trademark in question;
- it is not illegal to seek out the attention of internet users through targeted advertising that uses third party marks as keywords to trigger ad results;
- the test of consumers of average intelligence with imperfect recollection to adjudge likelihood of confusion would not be applicable here in its rudimentary sense – the test is to be viewed from the perspective of a person who is aware of how search engines function. A typical user does not expect search query results to offer a clear answer; rather, he or she is well aware of the nuances of sponsored ads that outline choices and may, in fact, be looking for alternatives;
- mere generation of interest in a sponsored ad result without any likelihood of confusion would not lead to a finding of infringement and each case is required to be assessed on its own facts.
Thus, the Ads of the defendants as they appeared in the search engine results were not deceptive or confusing. The links to the websites of Acko and Coverfox were under the names of the two entities and clearly marked as Ads. Even if use of such keywords by the defendants had added to the cost of advertisement for Policybazaar, it was not sufficient to lead to a finding of infringement or passing off. Additionally, what prevailed factually was that Policybazaar had itself used the Google Ads program to bid for Acko’s and Coverfox’s trademarks as keywords but concealed this material information.
Insofar as observations in respect of Google were concerned, the court reiterated that if an Ad was found to be infringing, Google being an active participant in the Ads program, could not claim the safe harbour protection available to intermediaries under section 79 of the Information Technology Act, 2000.
Policybazaar has appealed this order – we’ll keep you posted on developments!