The founders are seizing the Indian court’s decision to renew criticism of Google’s ad business

A recent Indian court ruling against Google’s keyword advertising practices has received new attention after the founders alleged that competitors have long used the system to defraud customers and force companies to pay to protect their products.

The verdict, handed down by the Delhi High Court on May 22 in a trademark dispute involving bathroom accessories maker Hindware, found Google guilty of trademark infringement for its keyword advertising practices and awarded the company R3 million (about $31,600) in general damages.

In her 163-page judgment (PDF), Justice Mini Pushkarna rejected Google’s argument that it was merely a passive intermediary in serving ads on its search platform. The judge said Google, through its AdWords platform, allowed Hindware’s competitors to use “Hindware” as a keyword to target users searching for the brand.

“Google for selling the plaintiff’s trademark [Hindware] as a keyword without authorization of commercial benefits violates the plaintiff’s right to exclusive use of his trademark under Section 28 of the Trademarks Act,” the judge said.

The decision drew attention on Friday after Indian businessmen, including Zerodha founder Nithin Kamath and Zoho founder Sridhar Vembu, publicly supported the decision, saying rivals had long used Google’s advertising tools to divert traffic from established companies and force companies to spend money protecting their brands.

Kamath, who said Zerodha has faced this issue for more than a decade, wrote in X: “Whenever someone searches for ‘Zerodha,’ traffic should come to Zerodha. But what usually happens is that the first few results in Google Search are ads, which lead the customer to a competitor’s website.”

Google, for its part, said its Ads policy on trademarked keywords “does not allow competing advertisers to use trademarked terms in ad text” and that the policy applies globally.

“We look forward to continuing to align our operations with local law enforcement while maintaining strong standards to protect the long-term interests of our users,” a Google spokesperson said in a statement to TechCrunch.

India is a key market for Google, with more internet users than any country other than China, making court decisions that affect its search and advertising businesses all the more important.

Legal experts, however, say the consequences of the decision may be less than the public reaction suggests.

“The decision by each group will require platforms to re-evaluate their processes to see if their automated tools are promoting or serving brand terms to advertisers as a whole,” said Aprajita Rana, partner at AZB & Partners.

Still, Rana told TechCrunch that the decision “doesn’t have a long-term impact” on India’s online debt market, as courts have already found that online companies can lose legal protections when they play an active role in illegal activity.

“The bottom line in this case is that providing access to trademarked terms, even to ad moderation that is between online platforms and advertisers and unknown to customers, can be a duty of participation by the platforms,” ​​said Rana.