Wednesday, October 14, 2009

Sweet Irony: Is IP Dragon Liable For Hosting IPR Infringing AdWords?

Law is often walking a few steps behind the developments in society. I propose the term "law lag", whereby I apply the "cultural lag" concept developed by Thorstein Veblen to law. Of course intellectual property and cyberlaw are not immune for this. One important question that should be answered is to what degree are internet service providers liable for content that infringes intellectual property rights on their site. In Europe there have been cases of Louis Vuitton; Gucci; and Chanel against eBay. And of course in China there were the Baidu and Yahoo! China cases (both companies were sued by music companies at different times with different outcomes), see here.

Another category of cases that is of interest is about Adwords. September 22, 2009, the Advocat-General of the European Court of Justice gave his advice for a pre-judicial decision about whether a Google adwords (for example where Louis Vuitton products are promoted by other companies than authorised by Louis Vuitton or even selling fake Louis Vuitton products) can infringe Louis Vuitton's trademark, that was requested by the French Cour de cassation. In short the advice included: the links in AdWords used do not equal to trademarks (those could be infringed on the sites to which they lead), the AdWords do not prejudice the functions of the brand, guaranteeing quality of the goods or the communication- or the promotional function. Contributory infringement is not part of the legislation in most EU countries. However, if the trademark holder finds that the AdWords link to IPR infringing websites and requests Google to remove these links, Google will be held liable and the trademark holder can get damages. Google was not exempt from liability for hosting, because it is not a neutral information instrument, as is requested by article 14 EC directive 2000/31.
Why I am writing this, you might aks, since IP Dragon is about IPR in China and not EU law?

Well although most of the IPR infringing products, that are key in all of these cases, originate from China, I got the following email (September 24, 2009) that concerned yours truly:

"Dear Mr. Friedmann,
I am a regular reader of your blog, and I enjoy your articles about IP in China. That being said, I noticed today a peculiar Google Ad on your page: « Louis.V. Handbags 50% Off ».Intrigued, and you may guess why, I followed the link :
http://www.handbagstime.com/?gclid=CMqR2oDQiZ0CFZQA4wodBG8J3A hum…. A quick look at the « contact us » page : http://www.yeslvgifts.com/contact_us.html It seems to confirm what I thought…What do you think ?
Cheers
Philippe"

This could happen, since IP Dragon writes frequently about fake, counterfeit and IPR infringing products and makes use of Google AdSense (which is the mirror of AdWords), which adapts its content to the subjects and some AdWord users choose these categories to promote their maybe dubious goods. If I would not block these AdWords after I was warned, in principle I would end up being liable. What do you think? Thanks, Philippe, for pointing me out the links.
Photo: Danny Friedmann

2 comments:

nickred2 said...

In 2007 Google and Third Electrical were sued by Gangyi for Google’s sale of the NEDFON Adword to Third Electrical; a Guangzhou District held Third Electrical liable and Google not liable in 2008. There have been earlier inconsistent rulings in other courts; this is perhaps the answer in a civil law jurisdiction – until there is a Supreme Court rule or a law, different courts may take different approaches, and so IP Dragon is at risk! Nick Redfearn

Chanel said...

nickred2 said...
In 2007 Google and Third Electrical were sued by Gangyi for Google’s sale of the NEDFON Adword to Third Electrical; a Guangzhou District held Third Electrical liable and Google not liable in 2008. There have been earlier inconsistent rulings in other courts; this is perhaps the answer in a civil law jurisdiction – until there is a Supreme Court rule or a law, different courts may take different approaches, and so IP Dragon is at risk! Nick Redfearn