This week, 1-800-Contacts sued LensWorld for allegedly purchasing branded terms in order to show LensWorld PPC ads when users are searching 1-800-Contacts. (MediaPost reports.) The key here is one company buying the branded terms of another company.
This is not the first lawsuit of its type. The question is around if it is infringement of any sort. Currently, engines allow advertisers to buy competitive brand terms if the competitors name is not used in the actual ad copy. Complaints to engines over this are handled on a case-by-case basis.
The main problem I see with a competitor buying the branded terms of another competitor is that it drives up the cost for that brand name. Simply, you could end up paying a high pay-per-click rate for your own name if your competitor purchased your brand name as well. (Many people I know in the industry follow an unwritten rule not to buy competitor brand names, often for fear of retribution on their own
This is a problem that is very hard to solve, and sadly, will probably have to be sorted out in the court room. Is it Google or Yahoo’s job to protect intellectual property? I say no, but engines constantly find themselves in the middle of this issue.
Honestly, it’s not much different than two advertisers appearing on the same page of a magazine. It is up the professionals that create the ad to distinguish it among the competitors.
Besides, every company should rank highly in organic listings for their own branded terms. If a company can not stand out on a search results page for their own branded terms, they have much larger issues than a competitors bid price.