Jurisdiction - Australia
News
Australia – The Average Internet User – From A Judicial Perspective.

18 September, 2013

 

Legal News & Analysis – Asia Pacific – Australia – TMT

 

Google Inc v Australian Competition and Consumer Commission [2013] HCA 1
REA Group Ltd v Real Estate 1 Ltd [2013] FCA 559
Interflora Inc v Marks and Spencer Plc [2013] EWHC 1291 (Ch)


WHAT YOU NEED TO KNOW

 

  • In Australia, recent decisions of the High Court and the Federal Court of Australia have shown that the “average internet user” is viewed as technologically advanced.
  • The level of understanding of the Google search engine, attributed to the “average internet user” by the courts, makes it more difficult to successfully argue that Google’s organic search results or sponsored links are misleading or deceptive.


The Australian High Court, UK High Court of Justice and Federal Court of Australia have delivered judgments this year in Google Inc v Australian Competition and Consumer Commission [2013] HCA 1 (6 February 2013) (Google), Interflora Inc v Marks and Spencer Plc [2013] EWHC 1291 (Ch) (21 May 2013) (Interflora) and REA Group Ltd v Real Estate 1 Ltd [2013] FCA 559 (7 June 2013) (REA Group).


Google search engine


As explained by French CJ, Crennan and Kiefel JJ in Google, when a user enters search terms into the Google search engine, it displays two types of search results: organic search results and sponsored links. Organic search results are ranked in order of relevance to the search terms entered by the user, as determined by the Google algorithm. Sponsored links are advertisements, which appear as determined by the Google AdWords program. Advertisers can “buy” keywords off Google, such that when a user searches for that keyword, an advertisement from the advertiser may be displayed. At the time Google was decided, sponsored links appeared either above the organic search results in a shaded yellow box or to the right of the organic search results in a white box. Both boxes were marked “Sponsored Links”.

 

Legal issues


Google, Interflora and REA Group considered three related but distinctly different legal issues:

 

  • whether a particular sponsored link is misleading or deceptive (Google; REA Group);
  • whether Google itself has engaged in misleading or deceptive conduct by publishing a misleading or deceptive sponsored link (Google); and
  • whether using a trade mark as a Google AdWords keyword per se is trade mark infringement by the advertiser (Interflora).


All three legal issues required the courts to define the current “average internet user”.


Google


The High Court in Google agreed with the primary judge that the “relevant class” is people who would have:


  • access to a computer connected to the internet;
  • some basic knowledge and understanding of computers, the internet and the Google search engine;
  • at least an elementary understanding of how the Google search engine works (but not a detailed familiarity);
  • appreciated that Google was a commercial enterprise and had to generate revenue;
  • read the sponsored links as a whole, including the URL, and would have expected to be taken to that URL upon clicking on the sponsored link;
  • inferred that sponsored links are advertisements and are different from organic search results; and
  • understood that sponsored links were messages from advertisers, which Google had not adopted or endorsed and was merely passing on for what they were worth.


Because Google did no more than represent that the sponsored links were advertisements, Google was found by the High Court to not have engaged in misleading or deceptive conduct.

 

REA Group


Bromberg J in REA Group followed the principles espoused by the primary judge and the High Court in Google. However, his Honour assigned a much greater degree of technical knowledge of the Google search engine to the “average internet user”. For example, according to Bromberg J, the relevant class would have understood that:

 

  • the prominence of a sponsored link depends on the payment made by the advertiser;
  • the order of organic search results depends on the relevance of the website to the keywords searched for by the user, with the most relevant result appearing first;
  • the organic search results are likely to be more relevant and reliable than sponsored links; and
  • the content of the organic search results is taken from the website and is not authored by the Google search engine.


Because the relevant class possessed this knowledge, his Honour found that the vigilance of an internet user would increase the further that user moves down the list of organic search results (such that small differences in the URL in low-ranked results would be more noticeable to the user than the same differences appearing in the first few results). This was relevant in REA Group, because the alleged misleading or deceptive organic search results appeared on page 5 of the search results, and therefore were held to be unlikely to mislead or deceive.

 

Interflora


Compared to the approaches of the High Court and Federal Court of Australia, the UK High Court of Justice viewed the “average internet user” as rather technologically illiterate.
Arnold J found that the average reasonably well-informed and observant internet user is broadly aware that there is a distinction between organic search results and sponsored links. However, his Honour still believed that “a significant proportion” would not appreciate that sponsored links appear “because the advertisers have paid for the advertisements to be triggered by a keyword consisting of or related to the search term entered by the user.

 

Changes to the Google search engine since these decisions


Since the Google decision, Google has revised its AdWords trade mark policy such that it will no longer prevent customers from using a third party’s trade mark as a keyword in advertisements. This means that trade mark owners will now have to contact the advertiser if they believe that a sponsored link is misleading, rather than making a complaint to Google.


In addition, there has been a change to the layout of the search engine since Google. The sponsored links are now marked “Ads related to [search term]” (above the organic search results) and “Ads” (to the right of the organic search results). This change makes it clear to internet users that sponsored links are advertisements. However, Google has also removed the shaded yellow box, making it more difficult to distinguish the end of the sponsored links from the start of the organic search results. Arguably, this second change could have altered the outcome in Google. This is because, as the primary judge noted, “the shaded rectangular box draws attention not only to the advertisements appearing within it but also to the words “sponsored links” appearing in its upper right hand corner“.

 

Ashurst Logo

 

For further information, please contact:

 

Gordon Hughes, Partner, Ashurst
gordon.hughes@ashurst.com


George McCubbin, Ashurst
george.mccubbin@ashurst.com

 

Ashurst TMT Practice Profile in Australia

 

Comments are closed.