The founders are using the Indian court ruling to revive criticism of Google’s advertising business

A recent Indian court ruling against Google’s keyword advertising practices gained new attention after founders said competitors had long used the system to siphon off customers and force companies to pay to protect their own brands.

The ruling, handed down by the Delhi High Court on May 22 in a trademark dispute involving bathroom fixtures manufacturer Hindware, found Google liable for trademark infringement due to its keyword advertising practices and awarded the company INR 3 million (about $31,600) in nominal damages.

In 163 pages Judgment (PDF) Justice Minnie Pushkarna rejected Google’s argument that it is merely a passive intermediary in displaying ads on its search platform. The judge said that Google, through its AdWords system, allowed Hindware’s competitors to use the word “Hindware” as a keyword to target users searching for the brand.

“Google’s sale of the plaintiff’s trademark (Hindware) as a keyword without any license for commercial gain is a violation of the plaintiff’s right to exclusive use of its trademark under Section 28 of the Trademarks Act,” the judge said.

The ruling drew attention on Friday after Indian entrepreneurs, including Zerodha founder Nithin Kamath and Zoho founder Sridhar Vembu, publicly announced… The ruling was upheldArguing that competitors have long used Google’s advertising tools to divert traffic from established brands and force companies to spend money to protect their names.

Kamath, who said that Zerodha has been facing this problem for more than a decade, books On

Google, for its part, said its advertising policy on branded keywords “does not allow competing advertisers to use trademarked terms in their ad text” and that the policy is applied globally.

“We look forward to continuing to align our operations with local legal frameworks while maintaining strict standards to protect the interests of our users over the long term,” a Google spokesperson said in a statement to TechCrunch.

India is a key market for Google, with more internet users than any country other than China, making court decisions affecting its search and advertising business particularly important.

However, legal experts said the implications of the ruling may be narrower than some public reactions suggest.

“The ruling itself will require platforms to reconsider their processes to see whether their automated tools encourage or advance brand terms to advertisers in general,” said Aparajita Rana, partner at AZB & Partners.

However, Rana told TechCrunch that the decision does not have a “far-reaching impact” on the liability of internet platforms in India, where courts have already established that internet companies can lose legal protection when they play an active role in illegal activity.

“What is important in this case is how providing access to brand terms, even in organizing advertising between online platforms and advertisers and unknown to customers, can be a participatory activity for the platforms,” Rana said.