Issued on 22 September by the Advocate General (AG) of the European Court of Justice (ECJ), the opinion argues that AdWords is non-infringing because it does not use marks in the course of selling branded goods or services.

According to the AG, if infringement applied in AdWords, it would have to apply to all essentially harmless uses of brand names on the web – such as the delivery of standard search results. Brand experts, however, have criticised the opinion, citing the web as a hotbed of trademark infringement.

AdWords allows third parties to run advertising links alongside normal links on Google search results pages. The ad links are triggered when brand-related keywords are typed into the search field. Those links typically lead users to websites run by the brands' vendors. The service has caused controversy for building a sub-market around the keywords, in which customer-hungry vendors bid for words connected with the goods they sell.

For trademark holders, this has amounted to an unacceptable level of brand abuse. Opponents of AdWords have alleged trademark infringement against Google on three grounds: 1) that the trade in keywords does not benefit the actual brand owners; 2) that third-party vendors – whether authorised or unauthorised – have been able to benefit from mentions of registered marks by using them to draw web traffic; and 3) that AdWords offers counterfeiters a prominent vehicle for making sales on fake branded goods.

The infringement allegations came to a head in the case of Google France and Google Inc v Louis Vuitton, in which Louis Vuitton launched a formal challenge against AdWords. Last year the French Cour de Cassation referred the case to the ECJ, asking for an official opinion on whether Google has the right to sell brand names as a part of its advertising strategy.

In his opinion, the AG concluded that AdWords 'does not constitute in itself an infringement of the exclusive right' conferred by a trademark. An ECJ statement added that, during keyword selection, there is 'no product or service sold to the general public. Such a use cannot therefore be considered as being a use made in relation to goods or services identical or similar to those covered by the trademarks'.

Brand experts have greeted the opinion with dismay. Linklaters IP partner Marianne Schaffner said that the opinion 'is not in favour of IP owners who … mainly suffer from infringement committed via the Internet'. Schaffner added that the opinion could raise uncertainties and even lead to disharmony between Member States. 'If the ECJ rules that there is no direct infringement,' she said, 'the national courts (depending on their national laws) may decide that Google contributes to the infringement. Or alternatively – as it had previously been considered by French Courts – hold Google liable [for] illicit advertising and/or unfair competition.'

Marks & Clerk partner Kirsten Gilbert was also concerned over potential EU disharmony. 'While a considered, harmonised position is needed over the rights of brand owners in search engines, this opinion is a devastating blow for European brand owners,' she said in a statement. 'A victory for Google means that brand owners will have to spend huge sums outbidding rivals, or bidding on their rivals' trade marks as well as their own. Or they may simply give up using sponsored links if increasing their bids becomes untenable.'