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Tanner Montague came to town from Seattle having never owned his own music venue before. He’s a musician himself, so he has a pretty good sense of good music, but he also wandered into a crowded music scene filled with concert venues large and small.But the owner of Green Room thinks he found a void in the market. It’s lacking, he says, in places serving between 200 and 500 people, a sweet spot he thinks could be a draw for both some national acts not quite big enough yet for arena gigs and local acts looking for a launching pad.“I felt that size would do well in the city to offer more options,” he says. “My goal was to A, bring another option for national acts but then, B, have a great spot for local bands to start.”Right or wrong, something seems to be working, he says. He’s got a full calendar of concerts booked out several months. How did he, as a newcomer to the market in an industry filled with competition, get the attention of the local concertgoer?

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by Gregory Golla
December 2008

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Keyword advertising comes with pitfalls; here’s how to avoid

Navigating through the ever-changing legal issues of keyword advertising, however, can be frustrating.

This article examines the common pitfalls businesses run into when advertising with keywords, in particular subjecting your business to potential trademark infringement liability.

So what is a keyword advertisement?

Similar to a billboard on the side of the street, a keyword advertisement is a billboard that appears on search engine results pages and is embedded within other Web sites as content advertising.

Keyword advertising is purchased by signing up with companies that deliver the ads, such as Google, Yahoo! and MSN.

For example, a piano teacher who desires more students may purchase the keyword “piano lessons.” The piano teacher chooses the geographic location where the advertisement is to be placed (let’s say Minneapolis), and chooses the bid price that the teacher is willing to pay for the advertisement. Assuming the bid is sufficiently high, the advertisement will appear on the search result page when a consumer conducts a search for the term “piano lessons.”

Purchasing the term “piano lessons” is not likely to create legal liability because it is a generic, non-protectable term. However, the use of trademarks in advertisements may create liability for trademark infringement. Three steps can help advertisers avoid the problem.

First, assess the landscape. A company using a trademark as a keyword to trigger and display an online advertisement may be liable for trademark infringement.

Before endeavoring to create an online keyword advertising campaign, online advertisers should assess whether the words they wish to use are protected.

This suggestion does not mean that a company can never use a competitor’s or another company’s trademark in its advertising. Rather, assessing trademark rights enables the advertiser to develop a strategy with an understanding of the possible risks.

To illustrate this step, consider the piano teacher mentioned above. Assume she teaches on a Steinway piano. Would she be liable for using the keyword

“Steinway” in her online advertising campaign? Maybe. If consumers thought that Steinway piano company endorsed or sponsored the piano teacher’s lessons, she may be liable.

However, by knowing that potential liability exists, the piano teacher can take steps to reduce the liability. First, she can choose not to use that keyword at all. Or, she could make it clear in her advertisement that she simply uses Steinway pianos.

Hidden meanings?

The second step is to understand the meaning of the keyword terms and how they will display in results. Advertisers should also consider any hidden or secondary meanings of the keywords chosen.

For example, the term “apple” can mean a fruit and a computercompany. When used in relation to the fruit, the term is consideredgeneric and not capable of trademark protection. Use of the mark torefer to computers, however, would likely infringe on Apple ComputerCo.’s trademark rights in its Apple mark.

By understanding the hidden meanings or variations, advertisers canprevent an unintended consequence of infringing on another’s trademarkrights.

For example, let’s consider a merchant selling apples and otherproduce at the Minneapolis Farmer’s Market who decides to expand hisbusiness by selling garden tools. He signs up for keyword advertisingand purchases the term “apple.” Provided he uses the term to sell hisapples, he will likely have no trademark issues because he is using thegeneric term to promote his products.

However, he also sells garden tools. He may have an unintendedconsequence if he uses the same term to sell his garden tools, ifanother company has a trademarked line with that name.

The third step is to limit the geographic and online placement ofadvertisements. Advertisers can choose broad geographic expanses suchas the United States or Europe. They may also choose particular statesor cities, like Minnesota or Minneapolis.

Geography counts

By choosing to limit the advertisement to a particular geography, an advertiser can limit potential liability. For example, a Minnesota-based jazz club named Blue Bandit may own trademark rights within that state. However,another jazz club may own that same name and trademark rights  in New York. By limiting the advertisements to show up in Minnesota, the Minneapolis advertiser likely limits its liability with respect to the New York company.

However, limiting the geography of an ad is not foolproof because the specificity of the geographic locations is not exact. For example,even if the Minneapolis Blue Bandit club limited its ad to run in Minnesota, the ad may still show up in New York if the consumer physically located in New York signed on using a server in Minnesota.

Advertisements may also be limited to particular online locations.Advertisers most typically choose to place their ads on the resultspages of search engine queries. In that case, the advertisements willbe triggered based on the term the consumer put in the search box.

Advertisers also have the option of placing the ads on third party Web sites that offer content related to the keyword. For example, a keyword “candy bar” may be shown on a site that sells candy. Unlike the search engine ad that is triggered based on what the consumer types in,content ads are based on terms listed on the site.

By understanding where the advertisements are placed, advertisers may limit their potential liability. The more conservative approach isto place ads only on search engine pages after searching the terms forpossible infringement issues.

Advertisements can be prepared and placed online in minutes. Taking some time to assess the landscape will help in protecting advertisers from liability.