Google has filed an appeal in the Delhi High Court against a recent order that held the company liable for trademark infringement in the Hindware AdWords case. The earlier ruling imposed a penalty of Rs. 30 lakh on Google and prohibited the company from allowing advertisers to use Hindware’s registered trademark as advertising keywords on its AdWords platform.
Legal Proceedings
A division bench of Justices V. Kameswar Rao and Manmeet P.S. Arora heard Google’s appeal on Friday. The court issued a notice to Hindware and scheduled the next hearing for July 24. The judges did not grant interim relief, meaning the previous order remains in effect pending a final decision.
Google’s Arguments
Senior advocate Abhishek Manu Singhvi, representing Google, argued that the earlier judgment contradicts several prior court decisions and established global practices. He noted that in many countries, bidding on competitors’ trademarks as advertising keywords is not considered trademark infringement. Google maintains that the AdWords system provides a legitimate way for businesses to reach potential customers through search advertising.
Background of the Dispute
The legal battle began when Hindware, a leading sanitaryware brand, alleged that rival companies were purchasing its trademark as a keyword through Google’s AdWords service. This caused advertisements from competitors to appear when users searched for Hindware on Google. Hindware claimed that this practice unfairly diverted its customers to competing brands.
Earlier Court Findings
In its May 22 judgment, the single judge ruled in favor of Hindware. The court found that Google derived commercial benefit from selling another company’s registered trademark as an advertising keyword, giving competitors an unfair advantage. The court also noted that Google never obtained permission from Hindware before making its trademark available for advertising. Additionally, the court rejected Google’s claim of protection under Section 79(1) of the Information Technology Act, stating that Google’s role exceeded that of a passive intermediary because it actively sold trademarked keywords.
Implications for Digital Advertising
The outcome of this appeal could have significant implications for digital advertising in India. If the court upholds the earlier ruling, companies may be barred from using competitors’ trademarks as advertising keywords. Conversely, a decision in Google’s favor would allow the current advertising model to continue, enabling businesses to reach audiences through keyword-based search ads. The July 24 hearing is expected to be a pivotal moment for the future of online advertising and trademark protection in the country.
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