In a significant ruling in Hindware v. Grohe, the Delhi High Court drew a distinction between the use of generic marks and coined, source-identifying marks like “Hindware” as keywords, while simultaneously narrowing the scope of intermediary safe harbour for platforms such as Google. The ruling builds on precedents such as Google v. DRS Logistics and Google LLC v. MakeMyTrip (India) Pvt. Ltd, where the courts have resisted treating keyword bidding as per se trademark infringement, particularly where the marks involved were descriptive or consisted of common trade expressions. The Hindware ruling however, appears to carve out a distinct space for coined and source-identifying marks. By treating invisible keyword deployment by Google as “use” under the Trademarks Act, the Court seems to shift the focus away from the visible display of marks to how trademarks commercially operate within online advertising systems.
Another major aspect of this decision is that it expands the liability of platforms like Google by treating them not as passive intermediaries, but as active participants in keyword recommendation and online advertising systems. If followed in future cases, it could lead to greater scrutiny of search advertising practices and reshape the scope of intermediary protection in India’s digital trademark regime. Discussing these aspects in detail, Arul Murugan S writes on this development below. Arul is a second year student at the Tamil Nadu National Law University and is interested in areas like intellectual property, corporate laws, the constitution, and human rights.
Public Squares vs. Private Estates: The Delhi High Court’s Doctrinal Shift in Keyword Advertising
By Arul Murugan S
Online, search engines have increasingly become the primary gateway through which consumers source goods and services. When a user surfs through Google to source his desired product, he will get two types of results, namely the inorganic advertisements sponsored advertisements triggered through keyword bidding mechanisms, organic results, that pop up through standard indexing algorithms. In this background, a dispute before the Delhi High Court asked whether usage of keywords in triggering the results may be brought under the purview of Trademark Act, particularly where such use diverts consumers toward competing products or services.
On May 22, the Delhi High Court, in Hindware Ltd. v. Grohe India Pvt. Ltd. & Ors., significantly expanded the contours of trademark protection in the context of keyword advertising by recognising that even invisible keyword usage may constitute actionable trademark use. The dispute arose when, defendant no 3, Google, while acting as an active intermediary that displays both sponsored advertisements and organic results, sold the plaintiff’s well-known Hindware trademark to third parties CERA and Grohe India under bidding mechanism. The dispute arose when defendant no 1, 2 – Grohe India Pvt. Ltd. And CERA Sanitaryware Limited purchased the plaintiff’s Hindware trademark as a keyword under Google’s bidding arrangement. This created a situation where a user, searching for plaintiff’s trademark was shown defendants sponsored advertisements.
In later stages of the suit, the plaintiff entered into a compromise with defendant no 1 and 2. In lieu of the settlement, Google, being the third respondent, contended that the compromise would also extend to it, releasing them from the suit, alongside other defendants. However, the Court noted of an independent cause of action for the continuance of suit against Google LLC- The use of plaintiff’s trademark by Google for auction and bidding as a part of its Adwords agreement.
Redefining ‘Use’ in the Algorithmic Age
The question here was whether Google’s allotment of one’s trademark as keywords to competitors would amount to infringement. The Delhi High Court adopted a broader understanding of “use” in the digital environment under Section 2(2)(c)(i) of the Trade Marks Act, 1999. This now includes backend keyword insertion, keyword-triggering, and Google Ads activation. This creates a situation where not only the visible trademarks are protected, but also invisible and algorithmic deployment of trademarks also may amount to commercial use under the Act.
The court has also expanded the interpretation of use “in relation to” goods/services under Section 2(2)(c) . While search engine intermediaries argued that invisible backend triggers do not constitute a visual representation under Section 2(2)(b), the Court relied on subclause c to hold that keyword insertion falls under the wide ambit of use “in any other relation whatsoever” to the goods. The Court tends to hold using a trademark to trigger competitor advertisements, divert consumers, and monetize search association to constitute use under the Section. This widens invisible digital conduct and commercial trademark exploitation.
Section 29(6)’s “Use in advertising” was interpreted to have a wider meaning. The Court held that the phrase doesn’t only explicit visible advertisements, but also may include backend keyword deployment, algorithmic advertisement triggering and sponsored search activation. Section 29(7), (8) deals with advertisements causing unfair advantage, detriment to the trademark. The Court hence treats diversionary advertising, competitor visibility through keyword bidding, and monetization of HINDWARE’s reputation as unfair advantage, dilution, or detriment to distinctive character.
The judgement also deals with Section 79 of IT Act’s interplay with the Trademark Act. The Court, from the factual matrix of the case held that the role of Google was much more than that of passive intermediary. It analysed the keyword recommendations, auction systems, monetization, and advertising architecture to hold it as an active intermediary. This hence weakens passive intermediary immunity, strengthens platform liability.
Public Squares vs. Private Estates: The Doctrinal Shift for Coined Marks
The present case however deals with a much wider question. The Delhi High Court, in the case of Google India private limited v. Makemytrip (India) private & ors. had cautioned against converting trademark protection into a right to suppress competitors. The Court refused to accept the argument that only because a user searches for a proprietors’ mark, it prima facie can demand its competitors link to be not to be displayed in form of sponsored advertisements. This must be looked through a doctrinal space where semi-generic service descriptors such as search terms are typically treated as a part of competitive advertisement arrangement, that facilitates trade and commerce activities unless consumer confusion or unfair advantage for competitor is shown.
The Courts followed a similar line of approach for cases that dealt with the interplay of keywords and trademarks. In case of Google India private limited v. DRS logistics pvt ltd & ors, the Court emphasized that keyword could not be considered as per se trademark infringement unless a clear case of confusion, unfair advantage, dilution is shown.
By doing so, the courts in earlier cases seemed to allow keyword advertising for generic, service oriented searches, but the present one presents higher scrutiny for those cases where the mark is coined and source-identifying like those of “Hindware”. This can be explained in a way where the previous rulings while offered lower protection to marks that consisted of generic terms with dictionary meaning, the present case introduces heightened scrutiny towards coined marks that are unique and source identifying. The Court hence decoupled keyword infringement from standard of proving consumer confusion.
The Court heavily relied on Section 29(8)(a), and held that a coined mark possesses an intrinsic, hard-earned ‘advertising function’ and commercial pulling power. Therefore, leading to an understanding that if an intermediary auctions off a coined mark to a direct competitor, it directly facilitates commercial free-riding. In essence, the judgement treats generic terms to be public squares, where alternative options can be open, while coined ones as private estates, that cannot be monitized by competitors.
Though the defendant relied heavily on the judgement of Google India private limited v. Makemytrip (India) private & ors, the Court drew a novel distinction by segregating “coined” ones from “generic” marks. The Court held that marks that are conjugation of generic dictionary words such as “MakeMyTrip” could not be saved due to its generic terms, however terms like “Hindware” that doesn’t share any relation with the good or service rendered by it, are coined and inherently distinctive word.
Google attempted to defend its bidding policy by comparing it with physical retail. For instance, a shopekeeper dealing with multi-brand electronics might offer a Lenovo product instead of a Dell one. However, the Court refused to accept it by holding that a coined mark is similar to that of an exclusive branded store, where the salesperson would never offer a competitors product.
Hence, the judgement once again reaffirmed the distinction between descriptive marks that have acquired secondary meaning and coined terms. It could inferred from precedents such as PhonePe Private Limited vs Ezy Services & Anr, where the Court emphasized that for a descriptive mark, the association must be so strong that the mark is “unmistakably and only and only relatable to one and only source.” The Court noted that this is not easily assumed and usually requires a trial.
Piercing the Safe Harbour: The Active Intermediary Standard
The judgement marks a shift from outcome-based analysis, regarding consumer confusion to conduct-based analysis, regarding the reason for selecting a coined mark. The Court held coined mark as a doctrinal filter. “No one searches for ‘Hindware’ unless they are looking for that specific brand”. This distinction hence justifies higher scrutiny for such coined marks as it helps in understanding stronger inference of unfair advantage, stronger inference of diversionary intent, and heightened protection.
The judgment appears to comparatively reduce emphasis on demonstrable consumer confusion in cases involving coined and reputed marks. For the same, the Court relied on the interpretation of Section 29(4) in the case of Bloomberg Finance LP V. Prafull Saklecha & Ors. The Court in the case interpreted the section through the lens of legislative intent of the Section. It held that a mark is protected under Section 29(4) if the mark has a reputation in India (b) that the mark has a distinctive character (c) the use by the infringer is without due cause. It hence held that it was not necessary for the proprietor of such mark to demonstrate the likelihood of confusion arising from the use of an identical or similar mark in relation to dissimilar goods and services.
While the judgement protects “coined”, “source-identifying” marks, it may also risk expanding trademark protection over search-market visibility. Further, the said distinction between generic terms and coined ones in keyword advertising raises a deeper doctrinal concern. The very idea of conferring generic marks with trademark registration seems to be undermined by the distinction made, as these marks get registered only after acquiring a distinct meaning, becomes easily identifiable by consumer due to their secondary meaning. If such marks continue to receive weaker protection, the very idea of trademark registration seems to be undermined. The long-term challenge would be balancing proprietary protection against preserving informational competition in digital marketplaces.
This judgement by distinguishing coined marks from generic ones in terms of keyword advertising or in other words, Generic marks are Public Squares; Coined marks are Private Estates, hence marked a doctrinal clarification from earlier judgements. It further held intermediaries like Google as active intermediaries for their active involvement, independent cause of action in bidding marks to competitors.
