Google fined by Delhi HC for misdirecting searches to rivals' products

NEW DELHI: The Delhi HC has ordered Google to pay Rs 30 lakh in damages to a sanitaryware maker after finding that internet users searching for the company's products were directed to rival manufacturers through Google's advertising system.

HC said Google is liable to pay damages for allowing rival competitors to place advertisements on Hindware's trademark as keywords, leading to losses. Google's Ads programme allows advertisers to bid on keywords to trigger their ads.

Hindware argued that when consumers typed its trademark into Google's search engine, sponsored links for competitors appeared alongside the search results, diverting potential customers.

Justice Mini Pushkarna, while dealing with two lawsuits by Hindware Ltd, held that the use of trademarks as keywords amounted to "unfair advantage" under the Trademarks Act and restrained Google LLC and Google India from using 'Hindware' or 'Hindware Sanitaryware', 'Hindware Sanitary' or 'Hindware Sanitaryware India' as part of advertising keywords for its platform.

HC also held that Hindware was entitled to actual costs of litigation. HC ordered the defendants to pay the amount within eight weeks.

The judge observed that Google's AdWords programme was a commercial venture to monetise the use of the search engine for advertising by displaying the sponsored links of various advertisers. By enabling direct competitors to intercept users when they expressed an interest in the plaintiff's mark, Google indulged in an "unfair practice" and also sought to exploit the distinctive character or repute of the plaintiff's well-known trademark to benefit its own advertising business, the court said.