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What’s in a name? (Part 3)

by Jimmy Bewley | March 10th, 2012

Trademarks and Google AdWords

Now that we have a little background on trademark law, how does this context fit with the Binder & Binder story, and how does it help us answer the question, “What’s in a name?” It starts with keyword advertising, specifically Google’s AdWords program. As many of you are well aware, Google offers the opportunity for “sponsored links” on a search results page. Behind the scenes, there is a whole other world of keyword activity pushing searchers to those paid links once a search is initiated. Advertisers bid on and purchase keywords they believe will drive traffic, through searches, to their website(s). It’s a common and sound advertising strategy in which we, cj, also participate. It’s also big business for Google—to the tune of about $20 billion per year.

Keywords can be law firm names. Disability Group, Inc., purchased the Binder & Binder name through Google AdWords to use for its own advantage and profit. As you might have guessed, Binder & Binder spend a lot of money on marketing. We don’t know the exact number, but we have a reliable estimate of around $20 million per year on TV alone. Binder & Binder also participates in keyword marketing. According to our latest estimate, the law firm spends around $20,000 per month or more for more than 1,000 keywords. No doubt, Disability Group, Inc., thought the purchase of the Binder & Binder name and keywords would allow them to reap the rewards of Binder & Binder’s promotional efforts and reputation. Disability Group, Inc., did not know, or bother to research, that the firm name, Binder & Binder, is a registered trademark. Oops. Binder & Binder sued.

Disability Group, Inc., immediately started bailing water and made several arguments. First, it challenged Binder & Binder’s ownership and validity of the mark. The argument was quickly rejected. Next, it challenged whether use of a trademark through Google AdWords can actually cause confusion in the eyes of the consumer. At first, Disability Group, Inc., thought it had something. After all, how can there be confusion by a customer as to the source of the product through using unseen keywords? Is the use of keywords really considered “use in commerce” as required for a claim based on consumer confusion? While not all jurisdictions have agreed on one path to get to the same conclusion, nevertheless, the answer seems to be yes. That’s yes, if you follow the guidelines of the Lanham Act. Outside of that legislation, there’s little or no guidance when it comes to regulating keyword advertising and trademark compliance and enforcement.