LONDON (AdAge.com) -- Google's AdWords system is the subject of another legal case in Europe, this time between flower-delivery service Interflora and U.K. department store Marks & Spencer.
Interflora is suing Marks & Spencer for allegedly "piggy-backing" on Interflora's reputation. M&S pays Google to promote the retailer's own flower business in search results every time a user searches on Interflora, so that "M&S Flowers online" appears directly below "Interflora" in the sponsored links section. A Marks & Spencer spokesman said, "This is industry-wide practice, which we say is not unlawful."
Interflora doesn't agree. The case is being heard in the European Court of Justice, the highest court in Europe. The flower-delivery service has two main gripes. The first is that M&S is creating a link between their goods and the goods sold under the famous Interflora name. But this point, according to Hamish Porter, a partner in the intellectual property group at European law firm Field Fisher Waterhouse, is likely to fall into the same category as a case lost by LVMH earlier this year. In that case, the court found that the link was part of a passive technological process and didn't involve use of the trademark in relation to goods.
Interflora's other grievance is that, because its brand name is used by a large group of different traders, consumers may assume that M&S -- due to its prominence in the search results -- is genuinely one of the traders that have paid to be a part of the Interflora network.
It is this second point -- about genuinely confusing consumers over the link between Interflora and M&S -- that Mr. Porter said could go against M&S. Mr. Porter said that, although it would not cause Google to change its AdWords system, it would result in the search engine taking down a lot of ads where there is any kind of question about deception.
Interflora refused to comment, but in a blog post, the company's marketing projects manager, Ann Bampton, said, "We have seen our advertising costs increase as a result of Google's AdWords policy. ... We are very serious about protecting our brand name. Our brand is a registered trademark, and the whole idea of registering marks is to protect them from misuse by third parties."
Google won't comment on the suit between M&S and Interflora, but in a blog post in March after the LVMH case, Google said, "User interest is best served by maximizing the choice of keywords" and "Our guiding principle has always been that advertising should benefit users."
In the earlier case, LVMH claimed that Google was unfairly promoting third-party retailers in its sponsored search results. Google won that battle because LVMH -- while losing some control over its brand -- did not lose business, because the listed retailers were still selling its goods.
In that case, the Luxembourg-based European Court of Justice pronounced that Google had "not infringed trademark law by allowing advertisers to purchase keywords corresponding to their competitors' trademarks." However, in the current case, M&S is promoting its flower business in direct competition with Interflora. And Interflora has chosen to sue a competitor for buying the keywords, rather than Google for selling them.
The Interflora vs. Marks & Spencer case was referred from the English courts to the European Court of Justice in June 2009, but the case only began its ECJ hearing this week.