The Delhi High Court’s decision in Google LLC v. MakeMyTrip (India) Private Limited is a landmark judgment that recalibrates Indian trademark law for the digital age. The case centred on ‘conquesting,’ the practice where a company bids on a competitor’s trademark as a keyword to trigger its own sponsored advertisements online. MakeMyTrip, a dominant player in India’s travel market, argued this was a theft of its goodwill. Google and its advertiser, Booking.com, framed it as legitimate competition that benefits consumers. In overturning an interim injunction that favoured MakeMyTrip, the court did more than settle a dispute over keywords, it redefined the very boundaries of trademark protection online. While the judgment rightly prevents trademark law from being used to stifle digital competition, its strict textual interpretation of the Trade Marks Act, 1999, exposes a significant legislative gap concerning unfair competition and rests on an idealised, and perhaps flawed, conception of the average Indian internet user.

The Digital Battlefield and the Court’s Ceasefire

The dispute involved three giants of the digital economy. MakeMyTrip (MIPL), the plaintiff, had invested heavily in building its brand, only to see its competitor, Booking.com, appear as a sponsored ad whenever users searched for “MakeMyTrip.” MIPL argued this was a parasitic act, allowing Booking.com to free-ride on its reputation and divert its customers. A Single Judge of the High Court initially agreed, granting an injunction that prohibited the use of MIPL’s trademark as a keyword, reasoning that it amounted to an unfair encashing of goodwill.

The Division Bench’s judgment, however, reversed this decision, fundamentally reframing the issue. It approached the dispute not as a simple case of misappropriation but as a complex interplay between trademark rights, consumer choice, and the mechanics of online advertising. The core legal question was whether the invisible, back-end use of a trademark as a keyword constituted infringement under the various subsections of Section 29 of the Trade Marks Act. The court’s answer, which ultimately gave a green light to keyword advertising, was built on a careful, if narrow, reading of the statute.

Redefining Trademark ‘Use’ in an Invisible Marketplace

The High Court’s analysis marks a significant shift from a proprietary view of trademarks to a functional one. A proprietary view treats a trademark as an asset, giving the owner absolute control over its use. The court instead adopted a functional approach, which posits that a trademark’s primary purpose is to identify the source of goods and prevent consumer confusion. So long as this function is not impaired, other uses may be permissible.

Central to this was the court’s distinction between the ‘use’ of a mark and its “use as a trademark.” The court found that while bidding on a keyword was a commercial use in the course of trade, it did not function as a trademark from the consumer’s perspective. The user never sees the keyword being bid on. What they see is an advertisement on the results page, clearly labelled as an ‘Ad’ and displaying the Booking.com URL. The court reasoned that a digitally literate user would not be confused into believing that an ad for Booking.com originates from MakeMyTrip.

This reasoning, while technically sound, underappreciates the commercial reality. The entire value of bidding on MakeMyTrip lies precisely in its power as a source identifier. Booking.com is not bidding on a random phrase; it is bidding on a term loaded with goodwill that MIPL has spent years and millions to build. The court’s formalistic analysis, by focusing only on the visible output, sidesteps the crucial issue of commercial misappropriation happening in the background. It effectively legitimises a business model where a brand’s reputation becomes a commodity to be auctioned off to competitors.

The Idealised Consumer and the ‘Competitor’s Loophole’

The judgment’s foundation rests on a precarious assumption about the average consumer. The court imagines a user who is reasonably informed and digitally literate, capable of easily distinguishing between sponsored and organic search results. This may be true for a segment of urban, experienced internet users. However, it fails to account for the vast diversity of India’s digital landscape, particularly the old and first-generation internet users who may not grasp the nuances of search engine monetisation. For these users, the distinction between a paid ad and a top search result is often blurred, making them susceptible to the very initial interest confusion, the court dismissed.

Perhaps the most significant consequence of the ruling is its creation of a ‘Competitor’s Loophole.’ The court dismantled the claim under Section 29(4), which protects well-known marks from unfair advantage, by applying a strict interpretation of the Supreme Court’s ruling in Renaissance Hotel Holdings. It held that all conditions of the subsection must be met, including the requirement that the infringing use be for dissimilar goods or services. Since MIPL and Booking.com are direct competitors offering similar services, this provision was deemed inapplicable.

This creates a paradox. A shoe company might be able to stop a hotel from using its famous brand, but it has no remedy under this section against a direct rival using its trademark to divert customers, unless there is a clear likelihood of confusion. This legal gap incentivises parasitic competition. A competitor can effectively piggyback on a market leader’s advertising spend, harvesting user intent generated by television or print ads the moment a user searches for the brand online. The judgment reveals that India’s trademark law, with its rigid focus on either consumer confusion or dilution for dissimilar goods, is ill-equipped to handle this form of reputational free-riding among competitors.

Conclusion

The Delhi High Court’s decision in Google v. MakeMyTrip is undeniably a victory for digital competition and consumer choice. It prevents dominant brands from monopolising search terms and ensures that challenger brands can make their case to consumers. However, the judgment is not without its silent casualties. It leaves the investment made in building a brand vulnerable to transparent appropriation and is premised on a potentially exclusionary ideal of the digital citizen. Most importantly, by exposing the Competitor’s Loophole, the court has highlighted an urgent need for Parliament to consider a more robust legal framework for unfair competition in the digital age. The law has now spoken in the algorithmic bazaar of the internet, you may own your brand, but you do not own the search query.