Use of Trademarks as Keywords in Google Ads: Legal Risks, Best Practices, and Preventive Approaches

When digital marketing crosses the line into unfair competition

In highly competitive markets, many companies turn to Google Ads to expand their reach and conversions. A common practice is purchasing a competitor's trademark as a keyword to capture consumer searches. This tactic, however, can constitute unfair competition and trademark infringement, with financial, reputational, and operational consequences. In light of the Brazilian Industrial Property Law (Lei de Propriedade Industrial – LPI) and recent decisions from Brazilian courts, the parasitic use of another's trademark as an ad trigger tends to be disapproved of, especially when it generates confusion and diverts customers.

The legal framework: registered trademarks, unfair competition, and liability along the chain

The LPI grants the trademark holder exclusive use of the mark within the corresponding segment, curbing improper appropriation of its distinctive strength. In online advertising, purchasing a third party's trademark as a keyword to display one's own ad may constitute an act of unfair competition (through customer diversion and confusion), as well as trademark infringement when the distinctive sign is exploited to improperly attract traffic. The debate also extends to platform liability when their role goes beyond mere technical neutrality, given that the advertising environment is structured to monetize terms, including trademarks. In all cases, the analysis is fact-specific: courts assess the ad copy, the displayed URL, the existence of negative keywords, and evidence that the ad was triggered by the third party's trademark.

Practical implications for companies: risks, evidence, and performance impacts

Risks for the advertiser include court orders to cease the practice, liability for material and moral damages (danos materiais e morais – compensation for financial losses and non-pecuniary harm), and litigation costs. Even when there is no precise mathematical proof of loss, courts consider the potential for consumer confusion sufficient to characterize the wrongdoing. From a business standpoint, the strategy can erode public trust, raise long-term customer acquisition costs, and divert marketing resources toward litigation.

For the trademark holder, the effectiveness of any response depends on the quality of the evidence gathered: updated and properly classified registrations with the Brazilian Patent and Trademark Office (INPI); screenshots of sponsored search results; audit tool reports; campaign logs; and documentation of ad variations and triggering terms. This evidentiary foundation supports cease-and-desist letters, takedown requests, and, when necessary, injunctive and compensatory judicial measures.

Compliance best practices and responsible marketing

Companies investing in performance media should adopt clear internal policies to avoid gray areas. It is prudent to prohibit the purchase of third-party trademarks as positive keywords while simultaneously setting up negative keywords to reduce accidental appearances in searches for competitors. Training internal teams and partner agencies in intellectual property and unfair competition helps prevent unintentional violations. It is also advisable to keep template notifications ready for platforms and infringing advertisers, supported by evidence of the trademark registration and the identified incidents.

Brand governance should include active monitoring of relevant searches, the use or hiring of brand protection tools, and periodic campaign audits. In markets with a high likelihood of confusion (similar trademarks, closely related services, strong local presence), subjecting sensitive campaigns to preventive legal review reduces risk without stifling growth strategy.

Legal prevention as part of a growth strategy

Balancing marketing speed with legal security is a competitive advantage. Integrating legal counsel into campaign planning, actively protecting intangible assets (trademark, trade name, domain), and establishing clear protocols for responding to infringements builds predictability, protects reputation, and reduces litigation costs. Whenever a campaign involves third-party trade names, regulated sectors, or a high risk of confusion, seeking specialized legal guidance is recommended. This approach does not guarantee results, but it positions the company on the best path toward compliance, efficiency, and sustainable growth.