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Google not guilty in Louis Vuitton case
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Google not guilty in Louis Vuitton case
AFP - Wednesday, March 24
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A Louis Vuitton store in Las Vegas, Nevada. Europe's top court backed Google on Tuesday in a case about trademark use in keyword Internet advertising brought by French luxury product maker Louis Vuitton, but both sides claimed victory.
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LUXEMBOURG (AFP) - – Europe's top court on Tuesday found Google not guilty of breaching trademark law by selling names such as Louis Vuitton in its Internet keyword advertising service.
However, the French luxury brand maker also claimed partial victory after the court warned Google it could be brought to book if it did not clamp down quickly on trade in fake luxury goods such as designer handbags.
Moet Hennessy Louis Vuitton (LVMH) and others argued that trademarks were being violated by the US Internet giant through Google's "AdWords" system that allows advertisers to piggy-back on protected brand names.
The EU Court of Justice said that "Google has not infringed trade mark law" but said the web giant can be held responsible if "having obtained knowledge of the unlawful nature" of advertiser activities, "it failed to act expeditiously to remove or to disable access" to that advertising.
LVMH vice-president Pierre Gode told AFP that in the fight against online distribution of counterfeit goods, this distinction amounted to "fantastic progress" for the luxury brand sector after three companies brought the case.
The companies were hoping to avoid having to pursue individual rogue online traders every time they appeared and LVMH said they would now work with Google in a bid to draw up new guidelines for vetting web advertising.
Google said it would "study" the ruling's full implications.
Online advertising is steadily gaining the upper hand in the market place and it is estimated that it will outstrip print adverts for the first time this year in the United States, according to California-based Outsell consultancy.
The case concerned Google's lucrative practice of accepting money from a clothes retailer, for example, to ensure their company appears among Internet search results when a particular designer brand is keyed in.
The advertiser's often less well-known name will appear alongside the designer brands under the heading "sponsored links," and that is where the likes of LVMH cried foul.
Google said the percentage of advertising stemming from rogue traders was minimal.
While Google can be pursued for not acting quickly enough once it is aware of fraudulent activity, the onus, according to the court, is on advertisers to allow consumers "easily to establish from which undertaking the goods or services covered by the ad in question originate."
The French court which heard the original case, the Cour de Cassation, had asked the European Union to rule. The Luxembourg-based court said on Tuesday that subsequent disputes are "for the national court to assess, on a case-by-case basis."
Google's senior litigation counsel, Harjinder S. Obhi, said the decision underlined that "trademark rights are not absolute," adding that "strict policies" were already in place forbidding counterfeit marketing.
He said the ruling "confirmed that European law that protects Internet hosting services applies to Googles AdWords advertising system."
LVMH said the judges removed "liability exemption" from Google or other web hosts of paid advertising.
"This decision represents a critical step towards the clarification of the rules governing online advertising," Gode said in a separate statement.
The European Brands Association stressed that "a seller of keywords, such as Google, may be liable if those keywords lead, for example, to counterfeits."
It argued that the protection that brand owners have off-line under 1988 legislation now also "applies online."
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