How The Hindware-Google Verdict Will Shape Advertising In The AI Age

In a landmark judgement, the Delhi High Court (HC) imposed a fine of ₹30 Lakh on search and AI giant Google for violating the trademark of sanitaryware major Hindware. It’s a trivial amount in the grand scheme of things, but it could have major repercussions when it comes to the digital advertising industry and its current crossroads when it comes to AI.

First the facts of the case: On May 26, a single-judge bench of Justice Mini Pushkarna ruled that Google allowed other companies to bid on the Hindware keyword on the erstwhile Google Adwords (now Google Ads), thereby infringing upon Hindware’s trademark.

The dispute dates back more than a decade, and since then, the advertising landscape has undergone a fundamental transformation. Google Ads has increasingly shifted toward AI-powered campaign products such as Performance Max, smart bidding, broad-match targeting, and automated ad generation. 

The keyword-dependent search targeting is no longer state-of-the-art. In fact, in many cases, advertisers no longer select every keyword manually; machine-learning systems determine which queries, audiences, and placements are most fitting.

This raises an important question: in an era where AI, rather than advertisers, increasingly decides when and where ads appear, will trademark disputes like the Hindware-Google case become redundant or could trademark and copyright battles become more complex in nature?

That’s before we even tread on the overarching concerns around copyright infringement by AI giants and LLM makers.  

How AI Has Shaped Google Ads 

AI-powered campaigns have become central to Google’s advertising strategy, marking a significant shift away from the traditional model where advertisers manually selected keywords, bids and audience segments.

Through products such as Performance Max, smart bidding, broad-match targeting and AI-generated creative tools, advertisers increasingly provide business goals, budgets and creative assets while Google’s machine learning systems determine which search queries, audiences and placements are most likely to drive results.

The system analyses signals such as user intent, browsing behaviour, location, device type and past performance to optimise campaigns in real time. Google argues that this automation improves efficiency and helps advertisers reach customers they might otherwise miss.

Performance Max crossed a million advertiser accounts in April 2025. AI Max for Search, which can automatically match queries and generate ad variations, is touted as the next big thing. 

But AI’s growing role in one of the world’s biggest ad networks also introduces new questions around accountability. In the past, advertisers deliberately selected competitor keywords. Today, an algorithm may independently associate a trademarked search term with a competing advertiser if it determines that doing so is relevant to a user’s search intent.

Are rules in place to prevent AI chatbots and search overview models to stop such practices?  

For its part, Google argues that advertisers continue to retain meaningful control through tools such as negative keywords and brand exclusions, which can prevent ads from appearing against specific search terms and brands.

“This being said, if an advertiser does not use such tools to restrict keywords, then these AI-driven models will display ads for a wide range of user queries, including competitor keywords, because the advertiser may not have the option to select individual and specific keywords against which such ads should be displayed,” said Ravi Goyal, a partner at law firm Scriboard.

AI-driven ad networks and targeting will have a similarly disruptive impact on trademark law and disputes.  

“Trademark infringement through AI-powered matching becomes much more complicated for trademark law,” said Jaspreet Bindra, cofounder of AI consulting firm AI&Beyond, adding that “Infringement used to have its roots in the advertiser’s purposeful purchase of certain keywords. Now, when AI algorithms decide which keyword will result in an ad, there is less clarity regarding the advertiser’s intentions.”

The Ghost Of Keyword Battles 

The Google-Hindware is hardly the first of its kind battle, even in India. A prominent example is MakeMyTrip’s case against Google. 

In 2022, the online travel agency filed a trademark infringement and unfair-competition suit against Google and rival Booking.com, alleging that competitors were illegally bidding on its registered trademarks ‘MakeMyTrip’ and ‘MMT’ as keywords to divert search traffic.

Like with Hindware, a single judge initially ruled for MakeMyTrip, but that interim order was set aside on appeal; in March 2024 the Supreme Court dismissed MakeMyTrip’s plea, observing that those searching for MakeMyTrip would not confuse it with Booking.com. The outcome worked in Google’s favour.

In 2023, the Delhi High Court rejected a plea by Policybazaar, insurance marketplace, seeking to restrain the use of key words identical to its trade marks on Google’s AdWords Program by other entities. 

Scriboard’s Goyal explained that the current Hindware–Google ruling is a single-judge decision and, based on past keyword advertising cases (like MakeMyTrip, PolicyBazaar, etc) Google is very likely to appeal. He expects Google to “definitely” appeal, and the eventual outcome could become an important precedent for future keyword advertising and liability disputes. 

A Google spokesperson commenting on the Hindware case, said that its ad policy does not allow competitor advertisers to use trademarked terms in the ad-text of an ad. Further, citing examples of MakeMyTrip, the company added that various courts in India have held and affirmed that internet users are discerning and are not automatically tricked just because a competitor’s alternative option pops up on a search page. 

While the jury is still not out in cases of traditional trademark infringement cases, as mentioned above, the problem may be exacerbated as advertisement moved to AI. For the average consumer, it can be difficult to distinguish between content that appears organically and content that has been influenced by a commercial arrangement. 

“Right now, there is no specific law that forces such platforms to label ads or sponsored content, but they are still covered by general rules under the Consumer Protection Act and ASCI guidelines, which prohibit misleading ads, misrepresentation, and unfair trade practices. If an LLM pushes sponsored content as if it were organic and this reaches a regulator or court, the platform could get into legal trouble,” said Goyal. 

AI Giants Run Into Ad Giants 

That risk grows with the money at stake and as new players bring ads into AI itself.

In the first quarter of FY26 Google’s ad revenue increased 15% year over year to $77.25 Bn (parent company Alphabet follows January-December cycle). It was buoyed by 19% search growth and 11% growth for YouTube.

This growth was, however, eclipsed by Facebook-parent Meta. For the same time period, the Mark Zuckerberg-owned company reported ad revenue of $55 Bn, a 33% increase.

The ad playing field is set to intensify as chatbot companies like OpenAI and Perplexity wade in. OpenAI cofounder Sam Altman earlier this year announced that ads are coming to ChatGPT, while noting that the ads would be clearly labeled and privacy-focused.

AI search company Perplexity, in 2025, said that it is taking a step back from its advertising initiatives amid struggles to monetize AI search, after announcing its initial plans in 2024. Claude-maker Anthropic, however, said that its AI chatbot will remain ad-free.

As ads migrate from keyword auctions into machine-driven matching and into chatbot answers the trademark owner’s complaint gets harder to pin down. When a human buys a rival’s name, intent is legible but with algorithms taking a call, the responsibility splinters between advertiser and platform.

This is why, as AI platforms also enter the ad arena, legal experts argue that legislation and regulations have to be updated for an AI-driven advertising world. And given the scale of this business and its potential impact on business trademarks, it wouldn’t be a surprise if AI-powered advertising algorithms and models are a key aspect within the broader question of regulations in AI. 

[Edited by Nikhil Subramaniam]

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