Trademarks: 9th Circuit Identifies A New Set Of Four Factors For Adwords/Keyword-Advertising Disputes

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On March 8, 2011, the 9th Circuit issued its opinion in Network Automation v. Advanced Sys. Concepts, --- F.3d ---, 2011 WL 815806 (9thC ir. 2011), addressing whether Network’s keyword advertising through Bing and Google AdWords is likely to confuse consumers where the keywords Network purchased to trigger its advertisement included the registered trademark of Advanced, its direct competitor. Procedurally, the 9th Circuit reviewed whether the district court properly granted a preliminary injunction. It found the so-called “internet troika” of factors were a poor fit, and identified a new set of four factors it sees as most relevant to keyword advertising disputes. Focusing on these factors, and noting that the ads were set apart from actual search results and were labeled as sponsored, the 9th Circuit held the district court erroneously found a likelihood of confusion, and thus, abused its discretion in granting the preliminary injunction against Network based on its use of Advanced’s registered trademark in keyword advertising on Bing and Google.

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