Technology and IP roundup: recent case law

The ever increasing developments in technology have seen the judicial community adapting and moulding traditional legal doctrines to meet the needs produced by change. Three recent cases consider the application of established law in the context of internet usage. The Google and iiNet cases consider the liability of parties who provide internet facilities that can be used by service users to infringe the intellectual property rights of third parties while the TPG case considers the penalties that will be imposed for misleading consumers who use popular search engines.

Australian Competition and Consumer Commission v Google Inc [2012] FCAFC 49

Facts

Google Inc (Google) provides a search facility offering users of its search engine two types of results; 'organic' results presented in order of relevance to the users search (as calculated by a complex algorithm), and 'sponsored' links which are determined by Google's 'AdWords' program. Sponsored links were those results appearing at the top of the webpage and to the left of the browser. The "Sponsored" link results were generally shaded a yellow colour and carried with them the words 'Sponsored result'. Advertisers pay Google for the use of certain keywords in the Adwords program which directs users of the search engine to their website. Evidence before the Court showed that Google's account managers often assisted companies in choosing keywords that would divert traffic from competitor's websites to their own.

The ACCC asserted that four of Google's 'sponsored' links constituted misleading or deceptive conduct in contravention of section 52 of the former Trade Practices Act 1974 (Cth) (now clause 18 of Schedule 2 to the Competition and Consumer Act 2010 (Cth)). The links contained a heading which corresponded to the user's search, but took the user to a competitor's website. By way of example, one of the links was a link with the heading 'Harvey World Travel' but which took users to the website 'www.statravel.com.au'.

Legal findings

The critical question in the case was whether Google had engaged in misleading and deceptive conduct through its sponsored links. At first instance, Justice Nicholas of the Federal Court found that Google merely provided the technical facility to allow the advertisements and so did not actually make, endorse or adopt the representations conveyed by the search results which were the subject of the complaint.1

On appeal, the Full Federal Court found that Google was...