Veda unsuccessful in online trademark action
Credit reporting major Veda Advantage has been largely unsuccessful in its attempt to prevent the credit repair firm Malouf Group Enterprises Pty Limited from using words and phrases containing the word "Veda" for internet marketing and advertising.In the Federal Court in Sydney on 21 March, Justice Anna Katzmann delivered a brief oral finding to the parties, and yesterday provided a detailed explanation of her reasons for finding that, for the most part, Veda had failed to prove damages from Malouf's use of "Veda" or that relevant trademark laws had been breached.This result will have implications for any firms using what would otherwise be trademarked words and phrases as 'keywords' in online advertising where the services are provided in reference to a well-established player in a sector, but are not a copy of its services.The court in this case was, in essence being asked by Veda Advantage to rule that Malouf Enterprises had infringed Veda's registered trademarks, engaged in misleading or deceptive conduct, or made false or misleading representations in contravention of the Australian Consumer Law. Veda's action, which began with a "cease and desist" letter in October 2014 - and detoured via unresolved mediation a year later - was over the use of no fewer than 86 keywords words such as "VedaScore", "VedaCheck", "Veda Advantage" and the word "veda" and other phrases in the titles and descriptions of sponsored link advertising in the Google AdWords program. This is what Veda Advantage found particularly irksome, alleging breach of trademark laws.The Court disagreed with Veda on most points. Justice Katzmann pointed out that, in the case of Google AdWords, potential customers were unaware of which words were being used to ensure Malouf's various firms were placed at the top of search lists. And if this did happen, the link was identified as a paid for result with the word "ad" appearing in a yellow box next to the result.Secondly, anyone could pay to use the Veda keywords under Google's AdWords program, including Malouf's competitors, and their use as search terms would produce not only sponsored links to Malouf's websites but also sponsored links to those of its competitors as well as "organic" search results - which would be mainly for Veda's own website. "Objectively, Malouf is, or was, not using the keywords as a sign to distinguish its services from the services of others. Rather, it has used them to identify internet users who may have an interest in using its services," was one reason given by the court in finding against Veda. Malouf, in contrast to Veda, is "in the business of assisting consumers with poor credit ratings to rectify errors in credit reports, including those issued by Veda, a process variously described as credit repair, cleaning or fixing," the court observed. The firm's principal is Jordan Francis Malouf, a former finance broker who saw a gap in the market for repairing credit reports. He now operates five such businesses, including Credit Clean Australia, Clean Your Credit, and Credit Fix Australia.