Independent thesis Advanced level (professional degree), 20 credits / 30 HE credits
Keyword advertising is based on advertisers buying keywords, brands if they so wish, with a search engine service to optimize their marketing by ads or websites linked to the purchased keyword to rank as high as possible among the organic and sponsored search lists. Regarding this type of marketing, the European Court and the Swedish Market Court made clear that the trademark holders of famous brands can not prevent a competitor from using the brands as a keyword for their own ads if the use merely indicates that the competitor offers an alternative to the protected brand's products or services. Despite this, this kind of use is questionable, given that the marketing tends to be perceived as deceptive, sponging on others reputation and not in line with good marketing, which is a natural consequence considering the use of competitors' famous brands to attract consumers.
My primary aim with this paper is to describe the legal risks within market law concerning keyword advertisements, especially in the context of good marketing practices and that includes the principle of conflicting laws as a basis for claiming unfair marketing according MFL. My secondary intention is to assess the possibilities of transferring the Swedish Market Courts general conclusion about keyword advertising, which is that keyword advertising is an appropriate advertising method, in relation to domain name disputes, based on the use of a competitor's brands in their domain name.
The current available laws and regulations gives no clear indication of how keyword advertising should be treated and therefore the Swedish Market Court’s practice has been crucial for assessing the issue. The brand’s different functions should have been damaged if the trademark shall be regarded as violated, however, considered keyword advertising with famous brands is viewed as a natural part of the competition and compatible with the advertising purpose and as an adaptable situation to maintain the investment function and thereby attract loyal consumers.
The available cases concerning keyword advertising does not include any assessments whether the risk of sponging of the reputation or dilute the brand, despite extensive use of it as keywords, in both ads and keyword holder's website. Current practice indicates that the greatest risk with keyword advertising is misleading marketing. This is because it is expected of the trademark holder to adapt to the situation by competing with the same methods to further stimulate competition and therefore it becomes difficult to argue that trade mark functions is being damaged by the use of the brand and reputation being diluted. The actual risk, greatest risk with keyword advertising, which can be ascertained from the current practice, is misleading marketing. What remains unclear is whether a total dilution of the brand’s reputation is the only basis that makes it possible to claim sponging on a competitor’s brand as conflicting to good marketing.
Overall, considered the use of competitor’s famous brand in keyword advertising with the current legal position into account, is viewed as an appropriate, comparative advertising which does not take unfair advantage of another trader's reputation and only brings the average Internet user's attention to an alternative. A transfer of this conclusion to domain name disputes is highly unlikely, however, is the infringement of trade mark possible. Whether sponging on competitors brands would be a reasonable basis to claim within the market law concerning domain name disputes are uncertain, however, the conflict of law principle is possible to claim when the trademark infringement is conflicting to good marketing and thus is unfair marketing accordance with general clause of good marketing within the Swedish Market Law.
2016. , 72 p.