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Excite keyword selling practice challenged in court

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Estee Lauder, the cosmetics and fragrance giant, has filed a lawsuit against the search engine Excite and online cosmetics dealer The Fragrance Counter (TFC), alleging infringement of its trademarks over the purchase of certain keywords. A number of Estee Lauder subsidiaries have also filed similar suits in France and Germany complaining of Excite's and TFC's conduct under the laws of those countries, the company said. The Estee Lauder company claims that Excite -- and TFC, which purchased the keywords -- are responsible for trademark infringement, false advertising and unfair competition. TFC, which operates fragancecounter.com and cosmeticscounter.com, bought the words 'Estee Lauder' and 'Origins' (an Estee Lauder brand name) so that anyone entering these into Excite's search engine would be faced automatically with a banner ad from the online cosmetics retailer. Estee Lauder alleges that since the ad is displayed prominently, it may mislead consumers into thinking that TFC is related to, or associated with, the world famous cosmetics company, when in fact it isn't. What's more, Estee Lauder maintains that it does not sell its products to TFC and that the online retailer is not an authorised retailer or distributor of Estee Lauder products. Fred Langhammer, president of Estee Lauder, said: "Each year, Estee Lauder devotes significant resources to build and protect the value of our brands and trademarks to maintain the veracity and quality of our products for consumers." "We have filed this lawsuit to protect both our trademarks and our customers who may be misled by TFC's advertising efforts on Excite and [its subsidiary] Webcrawler," he said. Selling keywords is commonplace among search engines and Estee Lauder is the believed to be the first company to challenge the practice. While it is widely perceived to be part of the rough and tumble of online competition, Estee Lauder's litigious reaction caught many people by surprise. If the US District Court for the Southern District of New York -- as well as the courts in France and Germany -– should find in favour of Estee Lauder, it could trigger a landslide of similar lawsuits. No one from Excite or The Fragrance Counter was available for comment when this story went to press. ®

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