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Some of the recent advances in search technology applications have outpaced the law. Although the courts have started to hand down important decisions about the liability of search engine providers, much is still unclear. In today’s Internet-oriented marketplace, these decisions affect virtually every type of business. In fact, businesses should be aware of the unstable law and potential liabilities surrounding search engine use. The risks cover a range of businesses: those providing search engine services, companies that maintain a Web presence or advertise online, copyright owners who post works on the Internet, and trademark owners seeking to protect their rights online. At the same time, more and more search engine technologies have appeared in recent months, with such recent launches as Amazon’s A9 service, AOL’s new version of its search feature, Microsoft’s revamped and enhanced search engine, and the rollouts by Google and other search engine developers of applications that allow users to search data stored in their own computers. What can businesses do to prepare for the legal complexities of search engines? Here are some of the legal issues and a few examples of the way the courts have recently handled search-engine-related matters. BRIEF INTRO TO SEARCH ENGINES Consumers often turn to search engines when they want to find something on the Internet, but don’t know where to begin. After pulling up a search engine of choice, the consumer will enter a query designed to retrieve particular information, Web pages, still images, or even videos. The search engine will then produce results in response to the query. There are three basic ways a search engine produces results: • Paid links. Paid links are the main source of search engine profits. When consumers have communicated their interest in a product or service, search engines target specific advertising at those consumers, as they are most likely to be receptive to it. They do this by selling particular search terms, or “keywords,” to advertisers who want to attract consumers searching for those terms. The links provided to the consumers as a result of these sales may be identified as “sponsored links,” “partner links,” or “advertiser links,” but some search engines may not clearly distinguish paid links from unpaid links. • Recommended links. Recommended links are links that a person acting in an editorial capacity has reviewed and recommended. A search engine may or may not provide recommended links. • Web results. These are the organic or algorithmically generated results that are not paid for or otherwise manipulated by any factor other than the computed “relevance” of the page relative to the user query. Search engines employ a number of programs, called “bots” or “spiders.” These programs enter the Web and then scan Internet protocol addresses, recording information either from the HTML tags that identify the content of Web pages (called “meta tags”) or from the information on the Web page itself. Google claims to have indexed 8 billion Web pages, while Microsoft claims 5 billion, Yahoo 4.5 billion, Ask Jeeves 2.5 billion, and Convera more than 1 billion. Search engines are constantly deploying one or more applications, which, in addition to finding Web pages, categorize and “score” them. The “scores” given to these pages help to determine the order in which links to the Web pages will appear. The results acquired and categorized by these systems are then displayed in response to a query (though perhaps not as prominently as the paid links). As revenues flowing from the sale of paid links have continued to grow � Google recently claimed fourth-quarter revenues of $1.03 billion � liability risks for those using the “paid link” system have grown as well. Here are some of the most important liability issues involving search engines and their impact upon the Internet. 1. Trademarks as search terms or keywords. If you have never used Google or another search engine to search for your company’s name, you may be in for a surprise: The first links listed may be to one or more of your competitors. Search terms � even trademarked company names � are regularly sold to a company’s competitors and used to trigger sponsored links to competitors’ Web sites. Not surprisingly, this practice has generated litigation. In GEICO v. Google, the U.S. District Court for the Eastern District of Virginia held that Google’s sale of the trademark “GEICO” as a search term did not amount to trademark infringement. The court’s decision appeared to rest upon the idea that while there may be a “use” of the trademark, the use is not confusing to consumers unless the trademark actually appears in the competitor’s ad. The judge in the case dismissed GEICO’s case, but didn’t address what would happen should a search engine use trademarked terms in competitor ads. This precedent, as well as general trademark law, indicates that another business’s trademarks should not be used without the permission of that business in the text of sponsored links or banner advertisements. That would more than likely amount to trademark infringement by the advertiser. What remains to be decided is how various courts will view the otherwise innocuous links or advertisements, which are displayed when another business’s trademark is used as a search term. The issue has been only preliminarily addressed, and the decision to pay a search engine to “key” your ads to appear when a competitor’s trademark is used as a search term should not be undertaken lightly. Similarly, the search engines themselves should be aware of the potential risks inherent in such a sale. Practically speaking, the majority of popular search engines have adopted a policy of removing paid-for listings if a legitimate trademark owner claims rights to a particular keyword. This is a compromise position, designed to appease brand owners. Prescreening keywords to check whether they are trademarked, however, would be an impossible task for most search engine providers. To protect themselves, companies may want to pay the search engines to ensure that the use of their trademarks triggers the display of appropriate advertising and search results, in much the same way as companies adopt defensive domain-name registration strategies. Search engines are very likely to be willing to “repossess” search terms in response to a request from a legitimate rights owner. 2. Disclosure of paid links. Some consumer advocates argue that paid links should not appear alongside actual matches for search terms at all. Currently, there are no U.S. laws or regulations governing the use or disclosure of paid links. In response to a complaint, however, the Federal Trade Commission says that changes should be made to the presentation of paid search results so that they are clearly delineated from non-paid listings. To date, the FTC has not taken any action against search engine providers on this recommendation, but the FTC presumably has the ability to do so to prevent false and misleading advertising. The results of a recent poll by the Pew Internet and American Life Project indicate that only one in six users of Internet search engines can differentiate between actual responses to their search and paid advertisements tied to their search term. Furthermore, only 38 percent of Web searchers even realize this distinction exists. The FTC will surely find these statistics troubling, and this type of evidence may prompt further FTC scrutiny. 3. Copyright issues arising from the use of thumbnails. Many search engines now offer the ability to search for images. In response to such a query, search engines provide a page full of many small images, or “thumbnails,” which have been indexed, with links to their original location. In Kelly v. Arriba Soft Corp., the U.S. Court of Appeals for 9th Circuit found this practice to be a fair use of the original work and, thus, not a copyright violation � but only in a particular context and within particular use parameters. Another lawsuit, currently pending, Perfect 10 Inc. v. Google, may result in further clarification. Perfect 10 is claiming that because Google indexes the pages of copyright infringers, and profits from that indexing, it should be held liable for the infringements. This case may begin to determine whether a search engine’s potential profits from the universe of Web sites that it indexes may allow it to be fairly characterized as having a “financial interest in infringing activities.” That factor has been established as a component of the infringement liability test. 4. Cached Web pages: where sites never change. Many search engines are automated. Search engines sometimes employ an automated Web crawler software program that downloads a Web page and then stores this file as the “cached” version. The cached version is later indexed in order to make it searchable. A subsequent search against that Web index generates results that include a link to the actual Web site, a brief summary of the linked Web page’s content, and a link to the cached version stored by the search engine. The fact that the cached version was downloaded, stored, and indexed in the past means that the current Web page content may now differ from the cached page. This situation could create a number of problems. In the United States, it’s not yet clear whether a search engine’s use of cached pages is a fair use for copyright purposes. This may be because most search engines have avoided the issue by suggesting that webmasters encode “opt-out” instructions into their pages to avoid having pages cached. Businesses should consider whether they would like their pages cached, and whether their sites may incur liability due to caching. There is no law yet that addresses liability in situations where a mistake (that causes injury) on a Web page is recorded and reproduced in a search engine cache, even though the mistake has been corrected on the actual site. 5. Meta tags as signposts. Although the methods by which search engines calculate return rankings for results vary, meta tags do play a role in determining results. A meta tag is a type of indicator by which a Web page and its features are described. Meta tags are inventoried by search engine bots, as part of their program, and may be incorporated into the “scoring” that the site receives for various terms. In the past, some groups used meta tags that incorporated popular or trademarked terms (such as Britney Spears or GEICO) even though their sites had no content affiliated with these terms. Search engine operators call this practice “spam.” In their legitimate form � where the descriptive tags roughly match the actual Web page and content � meta tags are often referred to as “search engine optimization.” Although manipulating meta tags may seem clever, it’s potentially a deceptive practice, subject to FTC enforcement. It may also be a trademark violation. To date, case resolutions involving meta tags have depended on the degree to which the trademarked term was appropriate. For example, in Playboy Enters. v. Welles, the 9th Circuit found that a former Playboy bunny’s use of the term “Playboy” in meta tags on her Web site was appropriate. 6. Takedowns: infringement claims and the law. The Digital Millennium Copyright Act (DMCA) contains provisions that limit the potential liability of Web site owners (including search engines) for transmitting or storing material that infringes copyright, provided that they remove pages or links when a copyright holder claims that those pages infringe its rights. The DMCA establishes a procedure for those who want a page removed (called a “takedown”) and a procedure for the Web site owners. The provisions are intended to provide a safe harbor for Web site owners so that they are not liable for copyright infringement without notice and cannot be found liable for properly responding to such requests. One high-profile example of the use of the DMCA involved the Church of Scientology and Google. Google took down links to Web site pages that the Church of Scientology claimed were infringing its copyright, though the pages were later returned. The DMCA’s provisions also include liability for entities that seek takedowns inappropriately, in an attempt to censor the speaker, rather than to protect intellectual property. The consequences of such actions can be substantial. Diebold Inc. recently agreed to pay damages and legal fees of $125,000 because it misused the takedown provisions. In summary, more and more cases over recent years have considered whether the activities of search engines and other online service providers cause liability. Despite the introduction of legislation aimed at harmonizing the treatment of search engines and the fact that many of the cases have considered the issues, a great deal of uncertainty still surrounds the legality of what are now the standard commercial activities of search engines and their partners. Marc S. Martin, a partner at the D.C. office of Kirkpatrick & Lockhart Nicholson Graham, is the former vice president, general counsel, and secretary to the Convera Corp., a search engine company. Associate Benjamin J. Oxley contributed to this article.

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