Founders seize on Indian court ruling to revive criticism of Google’s ad business

A recent ruling from an Indian court has reignited discussions about Google's advertising methods, particularly its keyword advertising practices. This ruling, issued by the Delhi High Court on May 22, found Google liable for trademark infringement in a case involving Hindware, a bathroom fittings manufacturer. The court awarded Hindware ₹3 million (approximately $31,600) in nominal damages. Justice Mini Pushkarna delivered a comprehensive 163-page judgment, dismissing Google's defense that it merely acted as a passive intermediary in ad placements. The court determined that through its AdWords platform, Google permitted competitors to utilize "Hindware" as a keyword to target users searching for the brand. The judgment stated, "Google by selling the trademark of the plaintiff [Hindware] as a keyword without any authorization for commercial gains is infringing the plaintiff’s right to exclusive use of its trademark under Section 28 of the Trade Marks Act." The ruling has attracted attention from Indian entrepreneurs, including Nithin Kamath from Zerodha and Sridhar Vembu of Zoho, who have publicly endorsed the court's decision. They argue that competitors have exploited Google's advertising system to redirect traffic away from established brands, compelling companies to spend resources to safeguard their own names. Kamath noted that Zerodha has faced these challenges for over a decade, stating, "Whenever someone searches for ‘Zerodha,’ the traffic should rightfully come to Zerodha. But often, the top results on Google Search are ads leading customers to a competitor’s site." In response, Google emphasized that its Ads policy prohibits competitor advertisers from using trademarked terms in ad text and that this policy is enforced worldwide. A spokesperson for Google expressed the company's commitment to align its operations with local legal standards while prioritizing the interests of its users. Considering the significance of India as a major market for Google, with its vast internet user base second only to China, the implications of this ruling are particularly noteworthy. However, legal experts caution that the actual impact of the judgment may be more limited than the public discourse suggests. Aprajita Rana, a partner at AZB & Partners, indicated that while the ruling will prompt platforms to reassess their processes regarding automated tools and trademarked terms, it does not drastically alter online platforms’ liability in India. She noted, "The key takeaway is how providing access to trademarked terms can be seen as a participative activity for platforms."