Bidding On A Competitor’s Common Law Trademark Through Google Adwords

BIDDING ON A COMPETITOR’S COMMON LAW TRADEMARK THROUGH GOOGLE ADWORDS – IS THIS LAWFUL? By Ryszard Lisinski - 14 Jun 2016

In the recent matter of Cockrane Steel Products (Pty) Ltd and M-Systems Group (Pty) Ltd and Another, the full bench found that bidding on a competitor’s common law trademark is not necessarily unlawful and does not automatically amount to unlawful competition or passing off.

In this particular matter, the appellant, Cockrane Steel Products (Pty) Ltd (“Cockrane”), did not have a registered trademark, but merely relied on their common-law right to the trademark of the word “Clearvu”, which right Cockrane managed to prove in this case.

Nevertheless, in this instance, the appellant failed to show that the public would be confused or deceived by the use of this trademark by the respondents.

The outcome of this matter may have been different if a registered statutory trademark existed and the appellant was able to show that the public was confused or deceived by the respondent’s use of such trademark.

Obviously, the situation would be different in the instance where a competitor or any third-party bid on a Google AdWord, which contained a well established trademark such as Simba, for example, to unlawfully direct traffic to the bidder’s website.

What can be taken from the aforesaid judgment is that in this specific type of situation, the merits of each matter must be carefully considered to establish whether or not the general public would be confused by the use of a common-law trademark by a competitor.