Founders seize on Indian court ruling to revive criticism of Google’s ad business

A recent Indian court ruling against Google’s keyword advertising practices has gained fresh attention after founders said competitors have long used the system to siphon off customers and force companies to pay to protect their own brands.

The ruling, delivered by the Delhi High Court on May 22 in a trademark dispute involving bathroom fittings maker Hindware, found Google liable for trademark infringement over its keyword advertising practices and awarded the company ₹3 million (around $31,600) in nominal 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 rivals to use “Hindware” as a keyword to target users searching for the brand.

“Google by selling the trademark of the plaintiff [Hindware] as a keyword without any authorization for commercial gains is infringing the plaintiff’s right to exclusive use of its trademark under Section 28 of the Trade Marks Act,” the judge said.

The judgment drew attention on Friday after Indian entrepreneurs, including Zerodha founder Nithin Kamath and Zoho founder Sridhar Vembu, publicly backed the ruling, arguing that competitors have long used Google’s advertising tools to divert traffic from established brands and force companies to spend money protecting their own names.

Kamath, who said Zerodha had faced the issue for more than a decade, wrote on X: “Whenever someone searches for ‘Zerodha,’ the traffic should rightfully come to Zerodha. But what often happens is that the first couple of results on Google Search are ads, leading the customer to a competitor’s website.”

Google, for its part, said its Ads policy on trademark keywords “does not allow competitor advertisers to use trademarked terms in the ad-text of an ad” and that the policy is applied globally.

“We look forward to continuing to align our operations with local legal frameworks while maintaining strict standards to protect our users’ long-term interests,” 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 affecting its search and advertising businesses particularly significant.

Legal experts, however, said the implications of the ruling may be narrower than some of the public reaction suggests.

“The judgment per se will require platforms to relook at their processes to see if their automated tools encourage or offer trademarked terms to advertisers at large,” said Aprajita Rana, a partner at AZB & Partners.

Nonetheless, Rana told TechCrunch that the decision does not have a “far-reaching impact” on online platforms’ liability in India, as courts have already established that internet companies can lose legal protections when they play an active role in unlawful activity.

“What’s important in this case is how providing access to trademarked terms, even in ad curation that’s between online platforms and advertisers and not known to customers, can amount to a participative activity for platforms,” Rana said.