The Delhi High Court found Google guilty of violating the trademark rights of a bathroom fixtures manufacturer by allowing its competitors to use its name as an advertising keyword, and imposed… $The tech giant has been fined $30,000, in an order that could have far-reaching implications for the online advertising market.
Google was found to have allowed rival companies to India’s Hindware to use the term “Hindware” as a keyword to target their own ads, without the company’s consent, which the court said amounted to “free riding” of Hindware’s reputation.
Justice Minnie Pushkarna, in a 163-page ruling dated May 22, directed Google to pay the fine within eight weeks and barred it from using Hindware or phrases combining its name with “sanitary ware” or related terms as advertising keywords.
Google AdWords allows businesses to reserve keywords — including competitors’ brand names — so that their ad links appear when users search for those terms. Higher CPC bids get more visibility.
Nithin Kamath, founder of Indian brokerage Zerodha, said on X that his brand had suffered from similar issues for years, and that the ruling “now opens a path to legal recourse.”
The court held that Google does not act as a passive platform but actively facilitates keyword-based advertising by suggesting keywords, identifying ads through its algorithms, and auctioning off trademarks based on a bidding system. The judge noted that in light of this active role, the use of trademarks as keywords amounts to use by Google itself.
“Google does not have any ownership rights in the ‘Hindware’ mark, nor does it have any license to sell access to the advertising function, i.e. the commercial attractiveness of the registered mark, to competitors of the trademark owner. However, by listing the trademark as a keyword and auctioning it to competing companies, Google is using the registered trademark as its own stock of trade,” the court said.
“By selling the registered trademark to competitors, Google generates revenue from multiple competitors of the trademark owner. Thus, Google benefits from the brand’s reputation without contributing to the creation of that reputation and, more importantly, without the owner’s consent.”
The court also rejected Google’s claim for safe harbor protection under Section 79 of the Information Technology Act 2000, which protects online intermediaries from liability for user-generated content provided they exercise due diligence and remove illegal material upon receiving court or government orders or gaining actual knowledge. Under section 79(3)(b), intermediaries lose this immunity if they fail to act after such notification.
Google said that any legal violation arising from the ads was attributable to the advertiser alone, and that it, as the platform provider, was immune from liability. The court disagreed, holding that Google’s sale of the Hindware trademark to direct competitors without consent, to obtain revenue, in itself demonstrated a failure to exercise due diligence.
The order was passed in two cases filed by Hindware against entities Grohe India, Omkara Infoweb, Cera Sanitaryware and Google. Hindware alleged that Omkara Infoweb and Cera had purchased its brand as advertising keywords such as searches for “Hindware” first directed consumers to Cera’s website. Likewise, Grohe purchased combinations of keywords including “Hindware Sanitary” and “Hindware Sanitaryware,” resulting in its website appearing as the top result.
During the proceedings, Grohe, Omkara Infoweb and Cera settled with Hindware and decrees were entered against them, leaving Google India and Google LLC as the only competing defendants.
