Consim Info Pvt. Ltd. v. Google India Pvt. Ltd. & Others

High Court of Judicature at Madras | Decided: 10 September 2012 O.S.A. Nos. 406 and 407 of 2010 Bench: Hon’ble Mr. Justice P. Jyothimani & Hon’ble Mr. Justice M. Duraiswamy (Division Bench) Citation: 2013 (53) PTC 1 (Mad) | 2012 SCC OnLine Mad 4582

Background

Consim Info Pvt. Ltd., the appellant in both appeals, is a private limited company engaged in providing online matrimonial services using the internet as its primary platform. In the course of its business the appellant adopted and registered several trademarks including Bharatmatrimony, Tamilmatrimony, Telugumatrimony, Assamesematrimony and approximately 18 other similar marks combining the name of an Indian state, language, ethnic group or religious community with the word Matrimony. The appellant claimed to be the market leader in the online matrimonial services business and operated websites corresponding to its registered trademarks. Out of its 22 registered trademarks, 4 were registered under Class 42 covering marriage bureau, matrimonial services, horoscope matching and services to facilitate online marriages, while the remaining 18 were registered under Class 16 covering printed matters.

The first respondent, Google India Pvt. Ltd., is the Indian subsidiary of the fifth respondent, Google Inc., a company incorporated in the United States of America and the owner and operator of the Google search engine. The first and fifth respondents together operate an online advertisement programme called AdWords, through which advertisers pay to display their advertisements as Sponsored Links on the right-hand side of Google’s search results page whenever a user enters a search term that corresponds to the advertiser’s chosen keyword. The first and fifth respondents also operate a Keyword Suggestion Tool, which automatically generates suggestions for keywords that advertisers may adopt based on the volume of searches for particular terms. The respondents 2 to 4 are competitors of the appellant in the online matrimonial services business the second respondent operates www.shaadi.com, the third respondent operates www.jeevansathi.com and the fourth respondent operates www.simplymarry.com.

The dispute arose from the use by the respondents 2 to 4 of the appellant’s registered trademarks or closely similar variations thereof as AdWords in the Google AdWords programme and from the inclusion of those trademarks in the Keyword Suggestion Tool offered by the first and fifth respondents. When an internet user typed any of the appellant’s registered marks such as BHARATMATRIMONY or TAMILMATRIMONY into the Google search box, the organic search results on the left-hand side of the page would display links to the appellant’s websites, while the Sponsored Links column on the right-hand side simultaneously displayed advertisements of the respondents 2 to 4 whose Ad titles and Ad texts contained either the registered trademarks of the appellant in their exact registered form or with a space inserted between the two constituent words for example BHARAT MATRIMONY or ASSAMESE MATRIMONY which were deceptively similar to the appellant’s registered marks. When a user clicked on such sponsored link text, instead of being directed to the appellant’s website, the user was redirected to the websites of the respondents 2 to 4.

The appellant alleged that the respondents 2 to 4 were directly infringing its registered trademarks by using them in the Ad title and Ad text of their sponsored link advertisements and were passing off their services as those of the appellant. The appellant alleged that the first and fifth respondents were guilty of contributory or ancillary infringement by including the appellant’s registered trademarks in the Keyword Suggestion Tool, by making them available for selection as AdWords by competitors and by permitting the respondents 2 to 4 to use those marks in the title and text of their advertisements. The appellant also alleged discriminatory treatment by Google, noting that when a user searched for websites of the respondents 2 to 4, the appellant’s links were automatically displayed on the sponsored links section in those search results as well, but when the appellant attempted to avail of the same facility, Google applied a different and more restrictive policy to the appellant than it applied to the respondents 2 to 4.

The appellant issued a cease and desist notice to Google. It then filed C.S. No. 832 of 2009 before the Madras High Court seeking permanent injunctions restraining all respondents from infringing its registered trademarks through the AdWords programme and Keyword Suggestion Tool and from passing off, along with rendition of accounts and damages of Rs. 10,05,000. Simultaneously the appellant filed two interlocutory applications O.A. No. 977 of 2009 and O.A. No. 978 of 2009 seeking interim injunctions. By order dated 17 September 2009 the learned Single Judge granted interim injunctions as prayed for. Thereafter by order dated 7 October 2009, upon Google’s counsel representing to the court that Google’s AdWords policy for India would not permit any registered trademark to be used in the title, text or URL of any sponsored link advertisement, the Single Judge vacated the interim injunctions and directed Google to adhere to its stated trademark policy. The Single Judge subsequently by a common order dated 30 September 2010 dismissed both interlocutory applications O.A. Nos. 977 and 978 of 2009. The appellant appealed to the Division Bench by way of O.S.A. Nos. 406 and 407 of 2010 against the dismissal of those applications. The second respondent also filed M.P. Nos. 1 and 1 of 2012 in both appeals under Order 41 Rule 27 CPC seeking to adduce additional evidence in the form of documents relating to the Trade Mark Registry.

Issues for Determination

whether the use by the respondents 2 to 4 of the words constituting the appellant’s registered trademarks including the combination of words forming the registered marks, as well as the use of such words with a space inserted between the two constituent words in the Ad title and Ad text of their Sponsored Link advertisements amounted to infringement of the appellant’s registered trademarks within the meaning of Sections 28 and 29 of the Trade Marks Act, 1999.
whether the appellant’s registered trademarks, being combinations of descriptive and generic words such as Tamil, Bharat, Assamese, Gujarati and Matrimony, were capable of protection under the Trade Marks Act, 1999 and whether the use of the individual constituent words or of the combination with a space in between by the respondents 2 to 4 in their advertisements could be defended as non-trademark use of descriptive terms falling outside the scope of infringement.
whether the first and fifth respondents, Google India Pvt. Ltd. and Google Inc., were guilty of contributory or ancillary infringement by including the appellant’s registered trademarks in the Keyword Suggestion Tool and by permitting the respondents 2 to 4 to use those marks in the title and text of their Sponsored Link advertisements and whether Google’s conduct in applying different policies to the appellant and to the respondents 2 to 4 amounted to discrimination.
whether the appellant had established a prima facie case and balance of convenience sufficient to justify the grant of interim injunctions, notwithstanding the arrangement in force since 7 October 2009 whereby Google had given an undertaking to the court not to permit the use of the appellant’s registered trademarks in the title, text or URL of sponsored link advertisements.
whether the second respondent’s petitions under Order 41 Rule 27 CPC to produce additional evidence in the form of documents relating to the Trade Mark Registry were maintainable, having regard to the belated filing and the absence of any explanation for the failure to produce the documents before the Single Judge.

Key Holdings of the Court

The Division Bench held that the appellant had established a prima facie case in its favour on infringement and passing off. The use by the respondents 2 to 4 of the combination of words constituting the appellant’s registered trademarks in their sponsored link advertisements whether in the exact registered form or with a space inserted between the two words was prima facie an infringement of the appellant’s registered marks under the Trade Marks Act, 1999. The insertion of a space between the two words forming the combined mark did not negate the likelihood of confusion, as the Single Judge had himself found at paragraph 148 of his order.
The Court held that while the individual constituent words Tamil, Bharat, Gujarati, Matrimony and similar terms were descriptive or generic in nature and could not be monopolised by the appellant individually, the appellant’s claim was restricted to the combination of these words as registered and the appellant had not sought any injunction in respect of the individual words used independently. The respondents’ use of the individual words in combination with a specific word Matrimony was the subject of the complaint and the Court agreed with the Single Judge that the injunction sought was not in respect of independent words but in respect of the specific combination. The Court disagreed with the Single Judge’s finding that granting injunction would leave the respondents with a very limited choice of words, noting that no pleading had been filed by any respondent identifying alternative synonyms.
The Court held that the registration of the appellant’s trademarks was prima facie evidence of their validity under Section 31 of the Trade Marks Act, 1999 and that the contention of the respondents challenging the validity of the registration on the ground that the marks were descriptive was to be considered and decided at trial. Under Section 32 of the Act, it was open to the appellant at trial to establish that the marks had acquired distinctive character through use between the date of registration and the commencement of legal proceedings.
The Court held that the balance of convenience also lay in favour of the appellant. While the Single Judge had found a prima facie case in favour of the appellant, he had incorrectly concluded that balance of convenience did not favour the appellant.
On the question of irreparable hardship, the Court held that this could only be examined and decided at the time of trial.
The Court found that Google India and Google Inc. had adopted double standards and discriminatory treatment as between the appellant and the respondents 2 to 4. When a user searched for websites of the respondents 2 to 4, the appellant’s links were displayed on the right-hand side as Sponsored Links and if the appellant’s keyword was clicked it went to the appellant’s website, while if the appellant’s trademark was displayed as a Sponsored Link in a search for the appellant’s own marks and was clicked, the user was redirected to the websites of the respondents 2 to 4 instead of the appellant’s website. This differential treatment amounted to clear discrimination on the part of Google. However the Court found that the full extent of this discrimination and its impact on the appellant’s business could only be assessed at trial.
on the question of whether the inclusion of the appellant’s marks in the Keyword Suggestion Tool amounted to deliberate conduct on the part of Google, the Court held that while it was possible to give benefit of the doubt to Google with regard to the initial inclusion of individual words such as Tamil and Matrimony in the Keyword Suggestion Tool on the basis that such inclusion may not have happened deliberately, the use of the combination of the two words with a space in between could only have happened deliberately. This aspect also required examination at trial by examination of witnesses.
however, the Court declined to interfere with the common order of the Single Judge dismissing the interlocutory applications, taking note of the fact that the arrangement based on Google’s undertaking given to the court on 7 October 2009 committing to adherence to its trademark policy and not permitting the use of the appellant’s registered trademarks in the title, text or URL of sponsored link advertisements had been in continuous operation for nearly three years. The Court held that the settled arrangement should not be disturbed or deviated from at this stage before the disposal of the suit. Both appeals were accordingly dismissed.
The Court directed that Google’s undertaking to adhere to its trademark policy must continue until the disposal of the suit and that Google must ensure that the appellant was not deprived of the benefit of its trademark policy.
On the petitions filed by the second respondent under Order 41 Rule 27 CPC for additional evidence, the Court dismissed both petitions. The second respondent had not stated any reason in its affidavit for the delay in producing the documents or for not producing them before the Single Judge. The documents were available at an earlier stage and no explanation had been provided for the failure to produce them at that stage. The dismissal of the additional evidence petitions was however made without prejudice to the second respondent’s right to produce those documents in the suit subject to proof and relevancy.
The Court requested the learned Single Judge to dispose of the suit as expeditiously as possible, preferably before the end of 2013, on merits and in accordance with law, without being influenced by the observations made in the Division Bench judgment.

Statutory Provisions Involved

Section 28(1) of the Trade Marks Act, 1999 confers upon the registered proprietor of a trademark the exclusive right to use the trademark in relation to the goods or services in respect of which the mark is registered and to obtain relief in respect of infringement in the manner provided under the Act. The Court identified three limbs to Section 28(1) the exclusive right to use, the limitation of that right to the goods or services for which the mark is registered and the right to obtain relief and held that the right conferred is subject to the other provisions of the Act.

Section 29 of the Trade Marks Act, 1999 defines and specifies the various acts constituting infringement of a registered trademark. Sub-section 1 provides that a registered trademark is infringed when a person uses in the course of trade a mark identical or deceptively similar to the registered trademark in relation to the same goods or services in such manner as to render the use likely to be taken as use of the trademark. Sub-section 2 provides for infringement where the mark used is similar to or identical with the registered mark on similar or identical goods or services likely to cause confusion. Sub-section 3 raises a presumption of likelihood of confusion where an identical mark is used on identical goods or services. Sub-section 6 clarifies that use of a registered mark includes affixing it to goods or packaging, offering goods or services for sale under the mark, importing or exporting goods under the mark and using the mark on business papers or in advertising. Sub-section 8 provides that a registered trademark is infringed by advertising that takes unfair advantage of and is contrary to honest practices, is detrimental to its distinctive character or is against the reputation of the mark. The Court applied these provisions to hold that the use by the respondents 2 to 4 of the appellant’s marks in the Ad title and Ad text of sponsored link advertisements constituted use in the course of trade within the meaning of Section 2(2)(c)(ii) and infringement within the meaning of Section 29(6)(d) of the Act.

Section 2(2)(b) of the Trade Marks Act, 1999 provides that any reference to the use of a mark shall be construed as a reference to the use of a printed or other visual representation of the mark. Section 2(2)(c) provides that in relation to services, use of a mark shall be construed as a reference to use of the mark as or as part of any statement about the availability, provision or performance of such services. The Court applied these definitional provisions in assessing whether the use of the appellant’s marks in the AdWords programme and Sponsored Links constituted use of the mark within the meaning of the Act.

Section 30 of the Trade Marks Act, 1999 limits the effect of a registered trademark in certain circumstances. Sub-section 1 provides that Section 29 shall not be construed as preventing the use of a registered trademark by any person for the purpose of identifying goods or services as those of the proprietor provided the use is in accordance with honest practices in industrial or commercial matters and does not take unfair advantage of or is not detrimental to the distinctive character or repute of the trademark. Sub-section 2(a) provides that a registered trademark is not infringed where the use in relation to goods or services indicates the kind, quality, quantity, intended purpose, value, geographical origin or other characteristics of goods or services. The respondents sought to rely on these provisions to defend their use as non-trademark descriptive use. The Court found that these questions required determination at trial.

Section 9(1) of the Trade Marks Act, 1999 provides that trademarks which are devoid of distinctive character or which consist exclusively of marks or indications designating the kind, quality, intended purpose, value or geographical origin of goods or services shall not be registered, subject to the proviso that registration shall not be refused if before the date of application the mark has acquired distinctive character through use or is a well-known trademark. The respondents 2 to 4 relied on this section to challenge the validity of the appellant’s registrations on the ground that the constituent words were generic or descriptive. The Court rejected this contention at the interim stage on the basis of Sections 31 and 32 of the Act.

Section 31 of the Trade Marks Act, 1999 provides that registration of a trademark is prima facie evidence of its validity. Section 32 provides that in any legal proceeding in which the validity of a registered trademark comes into question, the Court may uphold the validity of registration if it is shown that the mark has acquired a distinctive character as a result of use made of it after registration and before commencement of the legal proceedings. The Court relied on these provisions to reject the respondents’ challenge to the validity of the appellant’s registrations at the interlocutory stage.

Sections 15 and 17 of the Trade Marks Act, 1999 were referred to in the context of registration of marks consisting of two or more distinct components. Section 17 provides that registration of a trademark confers exclusive right to the use of the trademark taken as a whole and not separately to each of its constituent parts. The Court applied these provisions to hold that the appellant was entitled to protection of the combination of words forming its registered marks even though the individual words were descriptive.

Order 41 Rule 27 of the Civil Procedure Code, 1908 governs the admission of additional evidence in appellate proceedings. The Court held that the second respondent had not satisfied the requirements for admission of additional evidence at the appellate stage as it had produced no explanation for the failure to file the documents before the Single Judge.

Reasoning of the Court

The Division Bench’s reasoning proceeded through three principal analytical pathways.

On the infringement and passing off question, the Court reasoned that while the individual words Tamil, Bharat, Gujarati, Assamese and Matrimony were generic or descriptive terms incapable of independent monopolisation by the appellant, the appellant’s registration of the combination of those words and its claim were restricted to the combination and not to the individual words. The respondents 2 to 4 were using the combined words either in the exact registered form or with a space inserted between them in the Ad title and Ad text of their sponsored link advertisements. The Court found that the insertion of a space between the two words forming the registered mark did not make the usage sufficiently different from the appellant’s registered mark to eliminate the likelihood of confusion. When a user clicked on a sponsored link displaying the appellant’s trademark name, he was redirected not to the appellant’s website but to the website of one of the respondents 2 to 4 a circumstance that the Court found clearly misleading to consumers. The Court noted that the Single Judge himself had found a prima facie case on infringement but had gone on to find that balance of convenience did not favour the appellant. The Division Bench disagreed with that balance of convenience finding and held that the Single Judge’s finding of prima facie case was consistent with the balance of convenience also lying in the appellant’s favour.

On the discrimination by Google question, the Court reasoned by comparing the treatment afforded by Google to the appellant with the treatment afforded to the respondents 2 to 4. The Court found that when a user searched for websites of the respondents 2 to 4, the Sponsored Links section also displayed the appellant’s trademarks as links and clicking on those links directed the user to the appellant’s websites. The same facility of having one’s competitors’ links displayed when a user searched for the competitor’s mark was not extended to the appellant on an equivalent basis. The Court characterised this as clear discrimination on Google’s part. The Court further held that while it was conceivable that the inclusion of individual generic words such as Tamil and Matrimony in the Keyword Suggestion Tool may have occurred automatically without deliberate knowledge of the trademark status of those words, the combination of the two words with a space in between could only have been included in the Keyword Suggestion Tool by deliberate action. However the Court found that both these aspects required examination at trial.

On the question of whether to disturb the existing arrangement, the Court adopted a practical and pragmatic approach. Noting that Google had given its undertaking to the court on 7 October 2009 committing to adherence to its trademark policy and that this arrangement had been in continuous operation for nearly three years, the Court held that it was not appropriate to unsettle a functioning arrangement pending final determination. The Court preferred to confirm the Single Judge’s common order of dismissal rather than interfere with it, while simultaneously recording its finding that the appellant had established both a prima facie case and balance of convenience and directing that Google’s undertaking must continue until disposal of the suit. The Court’s approach balanced the protection of the appellant’s legitimate trademark interests against the practical realities of a three-year-old interim arrangement.

Doctrinal Significance

The Consim Info judgment is a landmark in Indian trademark law and internet law for several reasons, all arising from its treatment of the use of registered trademarks in the context of internet search engine advertising programmes.

The judgment is among the first decisions of an Indian High Court to grapple directly with the question of whether the use of a registered trademark as an AdWord or keyword in an internet search engine advertising programme constitutes infringement under the Trade Marks Act, 1999. While the Court ultimately declined to grant interim relief in view of the existing arrangement, it positively affirmed that the use of a registered trademark in the Ad title and Ad text of Sponsored Link advertisements whether in the exact registered form or with minor variations such as the insertion of a space between constituent words constitutes use in the course of trade within the meaning of Section 2(2)(c)(ii) and can constitute infringement within the meaning of Section 29(6)(d) of the Trade Marks Act, 1999. This is a significant holding that has shaped the legal framework for trademark enforcement in the digital advertising space in India.

The judgment is also significant for the distinction it draws between the use of individual descriptive words constituting a registered mark and the use of the combination of those words. The Court affirmed that while individual generic or descriptive terms such as Tamil, Bharat and Matrimony cannot be monopolised, the combination of those terms as registered by the proprietor may receive trademark protection and that use of the combination even with minor modifications such as the insertion of a space may amount to infringement. This distinction is practically important for entities operating in sectors where marks are commonly formed by combining geographic, ethnic or linguistic descriptors with service category words.

The Court’s finding that Google’s treatment of the appellant was discriminatory as compared to its treatment of the respondents 2 to 4 is also doctrinally significant. By requiring Google to adhere uniformly to its own stated trademark policy and directing that the undertaking given to the court must continue until disposal of the suit, the Division Bench established that a search engine cannot selectively apply its own intellectual property protection policies in a manner that discriminates between the trademark proprietor and its competitors.

The judgment’s engagement with the question of whether search engine advertising programmes involving trademarked keywords may constitute contributory or ancillary infringement is also important. The Court found that the deliberate inclusion of a combination of words forming a registered trademark as opposed to individual generic words in the Keyword Suggestion Tool was a matter of factual inquiry at trial. This leaves open for final determination at trial the question of a search engine’s liability as a contributory infringer where it actively facilitates or induces trademark proprietors’ competitors to use registered marks as keywords, while suggesting that mere automated inclusion of generic terms may not give rise to liability.

Finally, the Court’s observation that foreign judgments including decisions of the European Court of Justice in Google France SARL v. Louis Vuitton Malletier and the United States courts in the 1-800 Contacts line of cases have only persuasive value to the extent that the laws in India are similar reflects the Court’s careful approach to the interface between Indian trademark law and international developments in the law of internet advertising. The Court proceeded on the basis that Section 29 of the Trade Marks Act, 1999 and its specific provisions governing use in advertising provide a more protective framework for trademark owners in the digital advertising context than the legislative provisions considered in several of the overseas decisions relied upon by the respondents.

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