Delhi HC imposes ₹30 Lakh Fine on Google Over Use of Hindware Trademark for AdWords

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 The Delhi High Court has directed Google to pay ₹30 lakh as damages to Hindware for using the sanitaryware major's trademark as keywords for its AdWords programme.

Justice Mini Pushkarna, while dealing with two lawsuits by Hindware Ltd, held that the use of trademarks as keywords amounted to "unfair advantage" under the Trademarks Act and restrained Google LLC and Google India from using 'Hindware' or 'Hindware Sanitaryware', 'Hindware Sanitary' or 'Hindware Sanitaryware India' as part of advertising keywords for its platform.

"This Court awards nominal damages of ₹15 Lacs only each in the present suits, totalling to ₹30 Lacs only in favour of the plaintiff. The aforesaid amount shall be paid by the defendants, i.e., Google LLC/Google India within a period of eight weeks," the court ordered in the judgement dated May 22.

It also held that Hindware was entitled to actual costs of litigation in relation to its two lawsuits on the issue and asked it file its "Bill of Costs" within two months.

In the judgement, the court observed that Google's AdWords programme was a commercial venture to monetise the use of the search engine for advertising by displaying the sponsored links of various advertisers.

The court ruled that by enabling direct competitors to intercept users when they expressed an interest in the plaintiff's mark, Google indulged in an "unfair practice" and also sought to exploit the distinctive character or repute of the plaintiff's well-known trademark to benefit its own advertising business.

It said no prior consent or approval was admittedly sought by Google from the plaintiff for offering, suggesting and selling its registered trademark to other entities pursuant to the AdWords programme.

Google's act of auctioning and selling the use of the plaintiff's trademark as a keyword to direct competitors was not exempted under Section 79(1) of the IT Act, which grants intermediaries a safe harbour from legal liability, it further held.

In the judgement, the court also noted that until 2009, Google itself did not permit the use of trademarks as keywords in India but it subsequently changed its policy in India to allow such a practice.

"Thus, Google's commercial policy is clearly designed to promote the use of trademarked terms as keywords, and to reap commercial benefits out of the same," the court stated.