Second Circuit Holds That Keyword Ad Sales May Be A Trademark “Use In Commerce”

The Second Circuit recently held that a search engine's sale of keyword advertisements based on trademarks of others may constitute a "use in commerce" sufficient to state a claim under the Lanham Act. Rescuecom Corp. v. Google Inc., 2009 WL 875447 (2d Cir. April 3, 2009). This is an important decision as it substantially expands trademark protection on the Internet, which had previously been quite narrow under earlier Second Circuit precedent that had been relied on by lower courts in denying such claims as a matter of law.

Google's search engine responds to user searches in two ways. First, Google's search engine provides a list of links to websites, ordered in descending relevance to the user's search terms based on Google's algorithms. Second, Google's search engine displays context-based advertising. Google sells the placement of context-based links through its AdWords program and Keyword Suggestion Tool.