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Delhi High Court Rules Google's Keyword Ad Auction System Violates Trademark Law, Awards Hindware $31,600 in Damages

Delhi High Court Rules Google's Keyword Ad Auction System Violates Trademark Law, Awards Hindware $31,600 in Damages
India's Delhi High Court ruled on May 22 that Google's practice of letting competitors bid on trademarked brand names as search ad keywords constitutes trademark infringement — and founders of two of India's biggest tech companies are calling it long overdue. This is a narrow ruling with uncertain global reach, but it exposes a real problem that every small business with a recognizable name has quietly suffered for years.

What Actually Happened

On May 22, 2026, Delhi High Court Justice Mini Pushkarna handed down a 163-page ruling against Google in a case that started back in 2013.

The plaintiff: Hindware, an Indian sanitaryware brand. The problem: competitors Cera Sanitaryware and plumbing manufacturer Grohe were purchasing the keyword "HINDWARE" through Google's AdWords auction system. When customers searched for Hindware, they got Cera and Grohe ads at the top of the results page.

When you search for a specific brand, Google sells that brand's name to its competitors. The competitor gets the click.

Cera and Grohe eventually settled with Hindware directly. Google did NOT. The case against Google continued specifically to answer one question: does selling a trademarked name as an invisible keyword trigger count as "use in advertising" under Indian law?

Justice Pushkarna answered yes. According to The Print, she wrote that "it is not necessary that the registered trademark physically appears in an advertisement for the same to be used 'in advertising.'" The court permanently restrained Google from using "HINDWARE" or any variation as a keyword in its Google Ads program and ordered ₹30 lakh (roughly $31,600) in nominal damages.

Google's Defense Failed

Google argued it was a "passive intermediary" — basically a neutral platform just running an auction. The court rejected that argument entirely.

According to TechCrunch, Justice Pushkarna ruled that "Google, through its AdWords platform, allowed Hindware's rivals to use Hindware as a keyword to target users searching for the brand" and that this constituted infringement of Hindware's exclusive trademark rights under Section 28 of India's Trade Marks Act.

Google's passive intermediary defense is the same shield tech companies hide behind constantly. Courts are increasingly not buying it.

In a statement to TechCrunch, Google said its policy "does not allow competitor advertisers to use trademarked terms in the ad-text of an ad" and that the policy is applied globally. Competitors can't put your brand name IN the ad copy. But they absolutely CAN bid on it as a keyword trigger. The court just closed that loophole, at least in India.

Indian Tech Founders Aren't Surprised

The ruling lit up Indian tech circles almost immediately.

Nithin Kamath, founder of brokerage platform Zerodha, wrote on X that his company had faced this exact problem for more than a decade. Per TechCrunch: "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."

Sridhar Vembu, founder of software giant Zoho, went further. According to India Today, Vembu wrote on X: "I am with Nithin on this. What Google was doing was completely unethical and I am glad it has been found illegal in India. They need to be held to account for these shady business practices."

These aren't anonymous complainers. Kamath built Zerodha into India's largest retail broker. Vembu built Zoho into a $1 billion+ enterprise software company that competes globally. When founders at that level say this has been a decade-long problem, they're speaking from direct experience.

What Mainstream Coverage Is Missing

Most tech coverage treats this as an India-specific story with uncertain global implications. The framing obscures the broader pattern.

This practice isn't unique to India. ANY business with a recognizable brand name — in America, Europe, anywhere — faces the same dynamic. You build a brand. You invest years and millions into name recognition. Google then auctions that name to your competitors. You either pay Google to "protect" your own trademark in search results, or you lose clicks to rivals who paid Google for your customers.

That's the system. It's been the system for years. And almost nobody in mainstream tech media has examined it plainly.

The damages awarded — $31,600 — are nominal. Google made approximately $350 billion in total revenue in 2024, according to Alphabet's annual report. This ruling doesn't hurt Google financially. What it does is establish legal precedent in the world's most populous country and one of its fastest-growing internet markets.

Why India's Market Makes This Matter

According to TechCrunch, India has more internet users than any country except China. Google's search and advertising dominance there is near-total.

If Indian courts consistently enforce this ruling — and if other companies follow Hindware's example — Google may have to fundamentally alter how its ad auction works in India. It's a significant market in which to carve out an exception.

Google said it "respects local laws" and works through legal processes when court orders are "overbroad or inconsistent" with its policies. Translation: expect an appeal.

The Precedent

You built a brand. Someone Googled it. Google sold that search to your competitor. You paid Google anyway to defend yourself.

An Indian court just ruled that practice illegal. The ruling stands as precedent in one of the world's largest internet markets.

Sources

center-left TechCrunch Founders seize on Indian court ruling to revive criticism of Google’s ad business
unknown indiatoday.in Sridhar Vembu calls Google unethical after Delhi High Court trademark ruling - India Today
unknown theprint.in Google Ads: Indian sanitaryware brand took Google to court & won