By Lucy Rana and Huda Jafri
Introduction
The intersection of trademark law and digital advertising has long been a contested frontier. One of its most persistent flashpoints concerns the practice of keyword advertising, where a business pays a search engine to display its advertisement when a user searches for a competitor’s brand name. In a significant ruling, the Delhi High Court, in Hindware Ltd. v. Grohe India Pvt. Ltd. & Ors.[1], has provided what is, to date, India’s most definitive judicial answer to the question: does selling a registered trademark as a search keyword amount to trademark infringement, and can the search engine itself be held liable?
The Court answered both questions in the affirmative. It permanently restrained Google LLC and Google India Private Limited from using the plaintiff’s registered trademarks as advertising keywords, awarded nominal damages of Rs. 30 lakh, and held that Google could not avail itself of the intermediary safe harbour under Section 79 of the Information Technology Act, 2000.
Background and Facts
Hindware Limited is the registered proprietor of the trademark HINDWARE, which has been in use since 1991 in relation to sanitaryware products. The mark has also been judicially recognised as a well-known trademark.
Between 2013 and 2014, Hindware discovered that competing brands, namely Cera Sanitaryware and Grohe India, had purchased “HINDWARE” and its variations as advertising keywords under Google’s AdWords (now Google Ads) programme. As a result, when a consumer searched for terms such as “hindware sanitaryware,” the competitors’ sponsored advertisements appeared at the top of the search results.
Hindware instituted two suits. The advertiser-defendants, namely Grohe, Cera, and their web developer, subsequently settled the matter and consented to decrees. The litigation proceeded only against Google LLC and Google India, making the case a direct examination of platform liability.
The Legal Questions
Two issues fell for determination:
- Whether Google’s act of selling Hindware’s registered trademark as an advertising keyword constituted “use” of the mark within the meaning of Section 29 of the Trade Marks Act, 1999.
- Whether Google was entitled to safe harbour protection as an “intermediary” under Section 79 of the Information Technology Act, 2000.
Statutory Interpretation: “Use in Advertising”
Section 29(6)(d) of the Trade Marks Act, 1999 provides that a person uses a registered mark if they use it “in advertising.” Google contended that this provision requires the trademark to appear visibly in an advertisement. The Court rejected this interpretation.
Reading Section 29(6)(d) alongside Section 2(2)(c), which extends the concept of “use” of a mark to “any other relation whatsoever,” the Court held that the phrase “in advertising” encompasses the entire advertising process and is not confined to the final advertisement displayed to consumers. Invisible, back-end use of a trademark as a trigger keyword therefore falls within the statutory definition of use.
This interpretation is grounded in the legislative text. The statute employs the gerund “advertising” rather than the noun “advertisement.” The Court concluded that the mechanism by which an advertisement is activated is no less a part of the advertising process than the advertisement’s visible content.
Platform Liability and Safe Harbour
The more consequential holding concerns Google’s liability. Section 79 of the IT Act grants immunity to intermediaries in respect of third-party information, provided that the intermediary does not initiate, select, or modify the content. Google’s defence was that it merely hosted the keyword auction as a neutral conduit.
The Court declined to accept this characterisation. Based on evidence adduced at trial, including the cross-examination of Google’s own witnesses, it found that:
- Google permits registered trademarks to be bid upon and auctioned by competitors.
- No prior consent is obtained from the trademark owner before the mark is listed as an available keyword.
- Google retains all revenue generated from these keyword auctions.
- Google’s Keyword Planner tool actively suggests competitors’ trademarks as keywords to potential advertisers.
On this basis, the Court held that Google is “not a passive intermediary but runs an advertisement business, of which it has pervasive control.” Accordingly, the safe harbour under Section 79 was held to be unavailable in respect of the Google Ads programme.
Relief Granted
The Court granted a permanent injunction restraining Google LLC and Google India from using the plaintiff’s registered trademarks, including HINDWARE and its variants, as advertising keywords on the Google Ads platform.
The Court further directed Google to pay nominal damages of Rs. 30 lakh, jointly and severally, together with the actual costs of the proceedings.
Significance and Observations
This decision carries three notable implications for trademark practitioners.
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Intermediary Liability
The judgment narrows the safe harbour inquiry from “Is this entity an intermediary?” to “What does this intermediary do to generate revenue?” Section 79 was designed to protect passive conduits. The Court held that it does not extend to a revenue model built on monetising third-party trademarks.
This distinction is principled, though it is likely to attract scrutiny on appeal, particularly regarding whether imposing an obligation on a platform to police trademark ownership is consistent with the structural rationale underlying safe harbour protections.
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Trademark Protection in the Digital Environment
The ruling provides brand owners with a direct cause of action against search platforms. In practical terms, this offers a faster and more financially capable defendant than individual advertisers.
The judgment’s interpretation of “use” under Section 29 is likely to be relied upon in future keyword advertising disputes and may significantly influence the development of Indian trademark jurisprudence in the digital context.
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Comparative Law
The ruling diverges from the approach adopted by both the Court of Justice of the European Union in Google France v. Louis Vuitton[2], where the CJEU held that Google does not itself “use” a trademark by storing it as a keyword, and from United States jurisprudence, where courts in cases such as Rosetta Stone Ltd. v. Google Inc.[3] and 1-800 Contacts, Inc. v. FTC[4] have generally declined to impose liability at the platform level.
India’s approach, which fastens liability directly on the platform itself, represents the more interventionist position among these competing models.
Conclusion
Hindware Ltd. v. Grohe India Pvt. Ltd. & Ors. represents a significant development in Indian trademark law. It establishes, for the first time in a final determination rather than an interlocutory finding, that keyword advertising constitutes “use in advertising” under the Trade Marks Act, 1999, and that search platforms which actively operate and profit from keyword auctions are not entitled to safe harbour immunity.
Brand owners now possess a direct legal mechanism to proceed against platforms themselves, rather than being limited to actions against individual advertisers.
[1] CS(COMM) 591/2017
[2] (C-236/08 to C-238/08)
[3] Rosetta Stone Ltd. v. Google Inc., 676 F.3d 144 (4th Cir. 2012).
[4] 1 F.4th 102 (2d Cir. 2021)