Founders cite Indian court ruling to renew Google ad business attacks

A recent ruling from the Delhi High Court has reignited debate over Google’s advertising practices, as prominent Indian founders argue that the system has long allowed competitors to exploit brand keywords and force companies to pay to defend their own trademarks.

The decision, issued on May 22 in a trademark dispute with bathroom fittings maker Hindware, found Google liable for trademark infringement through its keyword advertising business. The court awarded Hindware ₹3 million (approximately $31,600) in nominal damages.

In her 163-page ruling, Justice Mini Pushkarna dismissed Google’s defense that it acted merely as a passive intermediary. Instead, she determined that Google’s AdWords platform enabled rival companies to purchase “Hindware” as a keyword, effectively targeting users who were searching for that specific 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 wrote.

The judgment gained traction on Friday after several high-profile Indian entrepreneurs voiced their support. Zerodha founder Nithin Kamath and Zoho founder Sridhar Vembu both argued that competitors have long used Google’s ad tools to siphon off traffic from established brands, forcing companies to spend money just to protect their own names.

Kamath, who said Zerodha has faced the problem for over a decade, posted 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 responded by stating that its Ads policy on trademark keywords “does not allow competitor advertisers to use trademarked terms in the ad-text of an ad” and that this policy is enforced 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.

India is a critical market for Google, home to more internet users than any country except China. That makes court rulings affecting its search and advertising businesses especially consequential.

Still, legal experts caution that the ruling’s impact may be more limited than 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.

However, Rana told TechCrunch that the decision does not carry a “far-reaching impact” on online platforms’ liability in India. Courts have already established that internet companies lose legal protections when they actively participate 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.