Google wins sponsored links case in Australia

February 6th, 2013 by Barry Sookman Leave a reply »

Google won an important case earlier today in the High Court of Australia  In Google Inc v Australian Competition and Consumer Commission [2013] HCA 1 (6 February 2013), Australia’s highest court unanimously allowed an appeal from a decision of the Full Court of the Federal Court of Australia which had found that Google had engaged in misleading or deceptive conduct contrary to s 52 of the Trade Practices Act 1974 by publishing and displaying sponsored links. The High Court ruled that Google did not create the sponsored links that it published or displayed. Rather, the advertiser was considered to be the publisher of the sponsored links.

According to the reasons written by French CJ, Creman J. and Kiefel J.,:

It is axiomatic that the Google search engine operates by the mechanism that users’ search requests are framed as search terms chosen by the user for the purpose of generating organic search results. What every advertiser seeks to achieve by use of the AdWords program is that its sponsored links will be triggered by search terms entered by a user (corresponding to keywords chosen by the advertiser) which indicate that the user may have an interest in the advertiser’s products or services. Google has no control over a user’s choice of search terms or an advertiser’s choice of keywords.

 The ACCC contended that Google, rather than the advertisers, “produced” (in the sense of making or creating) the sponsored links which are the subject of this appeal. That submission must be rejected. It is critical to appreciate that, even with the facility of keyword insertion, the advertiser is the author of the sponsored link. As Google correctly submitted, each relevant aspect of a sponsored link is determined by the advertiser. The automated response which the Google search engine makes to a user’s search request by displaying a sponsored link is wholly determined by the keywords and other content of the sponsored link which the advertiser has chosen. Google does not create, in any authorial sense, the sponsored links that it publishes or displays.

That the display of sponsored links (together with organic search results) can be described as Google’s response to a user’s request for information does not render Google the maker, author, creator or originator of the information in a sponsored link. The technology which lies behind the display of a sponsored link merely assembles information provided by others for the purpose of displaying advertisements directed to users of the Google search engine in their capacity as consumers of products and services. In this sense, Google is not relevantly different from other intermediaries, such as newspaper publishers (whether in print or online) or broadcasters (whether radio, television or online), who publish, display or broadcast the advertisements of others. The fact that the provision of information via the internet will – because of the nature of the internet – necessarily involve a response to a request made by an internet user does not, without more, disturb the analogy between Google and other intermediaries. To the extent that it displays sponsored links, the Google search engine is only a means of communication between advertisers and consumers….

Taken together, the facts and circumstances considered above show that Google did not itself engage in misleading or deceptive conduct, or endorse or adopt the representations which it displayed on behalf of advertisers.

For commentary on the case see, Google Adwords: a closer look at the High Court’s decision,  Google wins AdWords appeal in High Court,  No hits in High Court search for Google liability for its advertisers’ representations, Google Defeats Trademark Challenge to Its AdWords Service, Google Inc v Australian Competition and Consumer Commission.

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