Is AdWords Illegal?

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Of course, Google AdWords per se is not illegal. But the very tenets of the AdWords system—which lets advertisers bid for ad space based on keywords—may be in trouble. 901am reports of a recent lawsuit involving Google and a company called American Blind & Wallpaper Factory, Inc. American Blinds argues that Google is infringing on its trademarks by allowing competitors to bid on their keywords (i.e., “American Blinds”). This way, the company’s competitors can get top spot in relevant AdSense ad units, and even in AdWords for search units.

According to Reuters, American Blinds complaint argues that Google’s system violates trademark law by allowing competitors of American Blinds to use Google’s system to buy keyword search terms, such as “American Blind,” which trigger ads from rival companies.

“We spend millions of dollars annually to build brand awareness and cannot stand idle while Google allows our competitors to ride our coattails,” said a statement from Steve Katzman, CEO of American Blind.

Is this reasonable? Well, I’m no lawyer, but if they are using this argument, then perhaps they can also consider the possibility of competitors optimizing for those keywords. Macalua.com says some companies are already using their competitors’ names to optimize for search engine ranking. And they’re succeeding.

But Marc Macalua cites the Google AdWords policies in saying this practice is not acceptable.

Smart Communications Inc. is bringing the telco wars to search. Do a search for “globe visibility” (the product name for Globe Telecom’s flagship 3G/HSDPA mobile broadband service) and you’ll see the Smart 3G Adwords ad in the top PPC spot.

Is this keyword hijacking strategy legal? No, it’s not legal. That’s according to the Google Adwords FAQ:

Google takes allegations of trademark infringement very seriously and, as a courtesy, we’re happy to investigate matters raised by trademark owners. Also, our Terms and Conditions with advertisers prohibit intellectual property infringement by advertisers and make it clear that advertisers are responsible for the keywords they choose to generate advertisements and the text that they choose to use in those advertisements.

But then it’s not easy to monitor each and every AdWords bid to see if it’s potentially infringing on another company’s trademarks or copyrights.

Again, things like these bring up more questions, especially in the light of a changing media landscape, and changing practices and norms in the fields of PR and even law. Google is turning out to be the biggest player of them all, but is still not immune to criticisms and legal liabilities.

So is using a competitor’s keywords or name illegal? Probably, from the perspective of Google’s ToS, yes. But is Google liable when a client uses a competitor’s trade name as keywords? That’s what we have to find out soon.

I Am Not A Lawyer

There has been much talk about disclosure policies lately, especially with how some marketing groups have criticized pay per post and similar types of blog monetization schemes. For instance, do you know that PayPerPost owns disclosure.org? So they do encourage disclosure, but then it seems like a double standard with how they encourage disclosure, but covertly encourage people to use an automatic disclosure policy generator that they themselves own.

At any rate, here’s a funny thing I noticed surfing Andy Beard’s blog. He would sometimes include the following note on his posts, whenever he makes statements with potentially legal implications.

  • I am not a lawyer, and the wording I have used was not written by a lawyer

  • You should check with your legal consultant and this is provided for entertainment purposes only

Now I don’t think this would exactly turn away the legal types from actually dissecting your blog and looking for things they can use against you. But for the rest of us unlearned in the legal arts, this serves to be useful. Or at least quite humorous. This way, no one will blame you if they screw up or do something really stupid with the post you’ve just published.

It’s like saying I will not be held liable for any stupid stuff you may do as a result of reading my blog.

So there. Let me reiterate that I am not a lawyer, and if you get into hot water as a result of reading JOAB, or doing stuff that we recommended here on JOAB, it’s not our fault.

Helping Out A Fellow Blogger

Last September, I wrote about the issue of getting sued for blog posts or—worse—comments on one’s blog. This is one example of those cases where some bonehead attorney tries to take advantage of the legal system, but with apparently flawed reasoning. Some people can be so clueless, especially when it comes to technology. Well, either that, or they’re really ruthlessly clever enough to think of ways to pull it off.

Jeremy Shoemaker, the owner of Shoemoney, today’s top linked-to blog according to Technorati, says he is being subpoenaed and is being asked to cough up some of his blog’s server records in relation to a libel case filed against one commenter.

This time, it has happened to one of our own. A colleague at Splashpress Media, the former editor of the Blog Herald Abe Olandres is the target of a really stupid lawsuit. The basic premise: he is being sued for comments posted on a forum that his hosting business hosted.

I run a fairly small start-up web hosting here in the Philippines. One of our former clients runs a forum that we used to host. Several members of that forum were throwing vindictives against a their former employer. That employer sent us a demand letter thru their law firm demanding that we terminate the site or be charged with libel as well. The client moved out from us the following day. However, the employer/complainant has now filed several libel law suits against us claiming that we are the owner of the domain and the operator of the site. The site is still up and running though hosted somewhere else, the domain was also transferred away from us. Still, the complainant is alleging we should have enforced some sort of regulations or control over the content when it was still with us.

Apparently, all they wanted is money and this case is just of one of their many business gigs.

Really stupid? Yes. You would think that the complainant doesn’t stand a chance to win. Unfortunately, I believe, from where Abe is, the legal system doesn’t really understand technology and for all they know online forums are the same as a newspaper, which is probably easier to sue for libel! And it’s also really expensive, because you’d have to pay lawyers’ retainers, appearance fees and all that. This gets worse if court cases take years to finish. And it’s even worse if the case involves corrupt officials who need grease money to get things going.

Ah, the good old legal system. I would say that generally, the legal system (at least in, eherm, civilized countries) serves justice well. But in many cases, the legal system can also serve to line the pocketses (yes, my preciousss, let’s line our pocketsesssss with preciousss money) of officials and yes, lawyers. Looks like it is they who stand to gain in matters like this.

So to help out our fellow blogger, some guys over at the Blog Herald thought of setting up a fund drive.

Following reader suggestions (initiated by John Evans), we have set up a fund to help cover for Abe’s legal expenses, which he personally related to me has already reached quite a significant amount. We set up a Xoom link: https://www.xoom.com/pay/26999757 , which can accept any amount from US$25 to $2,500 paid via PayPal, credit card or e-check, and is deposited directly to a local account (mine, actually, since Philippine-based PayPal accounts cannot receive money). Donors could also send PayPal directly to the Blog Herald account at theblogherald (at) gmail (dot) com, which shall then be remitted to Abe come payday.

I’m currently low on funds right now, though. So I’m doing my best to help, and that’s by helping spread the word. You should, too!