Namesake Cyber-Squatting, An IPR Evil

What’s in a name?

For, if you were to call a rose by any other name, it would smell as sweet - - William Shakespeare

This Shakespearean quote, however, does not hold true in today’s day and age of the Internet and the intellectual property regime whereby a significant purpose of a domain name is to identify the entity that owns the website making the name as sacrosanct and imperative as its existence itself.

An address in the cyber-space is imperative in the new e-economy for companies and individuals to be easily traceable by their consumers with the emergence of the Internet as an advertising forum, recruiting mechanism, and marketplace for products and services whereby companies doing business have a strong desire to register domain names akin to their products, trade names or trademarks. For example, owners of famous trademarks, such as Haier, typically register their trademarks as domain names, such as www.haier.com. Domain names may be valuable corporate assets, as they facilitate communication with a customer base. With the advancement of Internet communication, the domain name has attained as much legal sanctity as a trademark or trade name and, therefore, it is entitled to protection.

However deliberate bad faith registration as domain of well-known trademarks in the hope of being able to sell the domain to the owners of those marks (or rival owners) or simply to take unfair advantage of the reputation attached to those marks is, in technical parlance, called cyber-squatting. Squatting is the act of occupying an abandoned or unoccupied space or building that the squatter does not own, rent or otherwise have permission to use. Hence cyber-squatting is aptly used to understand the same illegal activity in the cyber-space over the intellectual property of another. Interestingly, the first time that Network Solutions Inc (NSI) revoked a domain name registration was in mid-1994 when Joshua Quittner, a journalist preparing an article on domain name policy, upon realizing that it was still available, registered the site McDonalds.com. The giant burger chain with that name realized its mistake and pressurised NSI into taking action against Quittner. At that time there was no formal dispute policy in place. A week after revoking the registration, NSI seemingly realized it had made a mistake and reversed its decision. Thus the parties were forced to settle, with McDonald’s retaining the domain name and paying US $3,500.

Each machine on the Internet is assigned a unique address called an IP address (Internet Protocol address). IP addresses are 32-bit numbers, normally expressed as 4 octets in a dotted decimal number format. A typical IP address looks like this: 209.176.120.67. Since a byte can represent any number from zero to 255, the least and the maximum IP address possible are: 0.0.0.0 to 255.255.255.255. However locating a computer through an IP Address is a difficult task, since there are so many of them. Hence the architects of the Internet have thought of another innovative method to access websites without having to remember the IP address of each website. This method is known as domain name system or DNS. Every domain name is divided into levels. A top-level domain name is a suffix which serves to place the site within one of the broad categories such as ‘.com’ (for commercial), ‘.edu’ (for education), ‘.gov’ (for government), ‘.org’ (for organisation). The second level domain name appears before the top level and serves as a trademark or trade name function. Therefore, each domain name is unique and specifies some information as to the contents of a website to the users.

Cyber-squatting involves the use of a domain name by a person with neither trademark registration, nor any inherent rights, to the name. The Domain Name System (DNS), after all, provides an opportunity for others to pirate names with its first-come-first-served basis.

Another issue is the registration of names of popular brands with a slight spelling variation like pesi.com and radiff.com for the sole purpose of diverting traffic to their website through typing errors. ‘A significant purpose of a domain name is to identify the entity that owns the website.’ A domain name should not confuse the consumers as to the origins of the services or products defeating the principal of trademark law. In Rediff Communications Ltd. v. Cybertooth & Another the Bombay High Court while granting an injunction restraining the defendants from using the domain name ‘RADIFF’ or any other similar name, held that when both domain names are considered there is every possibility of internet users being confused and deceived into believing that both domain names belong to one common source and connection although the two belong to two different persons. Again the website using the domain name, ‘Naukari.com’ was held to be confusingly similar to that of the plaintiff, ‘naukri.com’, with a different spelling variant establishing prima facie inference of bad faith.

In Yahoo Inc v. Akash Arora , the plaintiff filed an action against Akash Arora for passing off its sources on the Internet as those of the plaintiff’s by adopting the domain name ‘yahooindia.com’. The court held that although Internet users were technically educated and literate, this would not reduce the risk of confusion. This case is important since it delves into the psyche of the consumers where the likelihood of confusion will arise. The very fact that a person who intends to visit the Internet site of the plaintiff may reach the defendant’s site owing to similarity in the domain name, was a factor sufficient to grant injunction. Even Google had a cyber-squatter whereby www.googl.com, a cheeky search service was set up in Texas trying to cash in on Google’s success.

A trademark is a distinctive sign, which identifies certain goods or services as those produced by a specific person or enterprise . Trademark rights arise from the actual use of the mark. Thus if a product or service is sold under a brand name, common law trademarks have been created. An unregistered trademark, called a common law trademark can be kept alive and protected for as long as it continues to be used provided the owner of the mark takes appropriate action against infringers by a passing-off action. In Sade’s case , although the complainant had not registered the word ‘Sade’ either as a trademark or service mark, the complainant had established common law rights in the said mark and the said domain name was transferred to the complainant. Similarly a passing off action was introduced in Titan Industries Ltd. v. Prashant Koorapati, whereby the plaintiff had extensive trade name use of tanishq, which was held sufficient to make a prima facie case for passing off.

Certain generic words or phrases cannot gain trademark protection, and therefore have no value as trademarks. For instance the words, chocolates or tables cannot gain trademark protection. The generic name of a product is the very anti-thesis of a mark. These are generic terms that have passed into common usage to identify a product and are commonly used as the name of a kind of goods such as medicines and can never be protected. Similarly, if a domain name is the same name by which the product or service is typically described, the law will consider it generic and will not treat it as a trademark. However, the contention that a dictionary word cannot be appropriated as a domain name/trademark is misplaced as there are number of such words being used by various companies as their trademarks.

The said words although are dictionary words have acquired uniqueness and distinctiveness and are entitled to protection. In Yahoo Inc v. Akash Arora , the Court held that the mark ‘yahoo’ was widely publicised and well known and the fact that it was a dictionary word was no reason to deny protection for the mark. Similarly in the famous Madonna’s case it was held that although the word ‘Madonna’ has an ordinary dictionary meaning which is another name for Virgin Mary, it was given trademark protection since it was held that the same was not used in good faith, instead it was selected and used to attract internet users for commercial gain by trading on the fame of the complainant’s mark. Again the word orange has been protected as a trademark and the domain names orangewirefree.com and orangewireless.com were transferred to the complainant. In Satyam’s case , too, the complainant, an information technology giant acquired the disputed domain names ‘satyam.org’ and ‘satyam.net’ registered by the respondent. The complainant’s trademark of ‘Satyam’ was protected inspite of the respondent’s contention that it was a general word underlying the idea behind the adage ‘Satyam Shivam Sundaram’ due to the distinctiveness acquired by the complainant.

The Internet Corporation for Assigned Names and Numbers (‘ICANN’), a domain name regulatory authority, adopted a Uniform Domain Name Dispute Resolution Policy (‘UDRP’), which is incorporated into the Registration Agreement, and sets forth the terms and conditions in connection with a dispute between the registrant and any party other than the registrar over the registration and use of an Internet domain name registered. Upon entering into the Core Registration Agreement with ICANN while registering a domain name, one agrees to submit to proceedings commenced under ICANN’s Uniform Domain Name Dispute Resolution Policy. The relation with ICANN and the registrant of a domain name is that of a licensor and licensee whereby the latter submits to Mandatory Administrative Proceedings under Paragraph 4(a) of the Uniform Domain Name Dispute Resolution Policy.

According to the ICANN policy, the registration of a domain name shall be considered to be abusive when all the following conditions are met:

(i) the domain name is identical or misleadingly similar to a trade or service mark in which the complainant has rights; and
(ii) the holder of the domain name has no rights or legitimate interests in respect of the domain name; and
(iii) the domain name has been registered in bad faith.

The term ‘bad faith’ does not simply mean bad judgment but it implies the conscious doing of a wrong with a dishonest purpose. In order to prove bad faith, the following circumstances, if found, are sufficient evidence of bad faith registration.

Firstly, when there is an offer to sell, rent or otherwise transfer the domain name to the owner of the trademark or service mark, or to a competitor of the complainant for valuable consideration.

‘Cyber-squatters often register domain names incorporating the trademark of others, with the intent of selling the domain names back to the trademark owner at a profit’. In Marks and Spencers P.I.C. v. One in a Million, the defendants had registered domain names corresponding to well-known trademarks with a view to make profits either by selling them to the owners of the goodwill or to collectors.

The second circumstance, which can constitute, as evidence of bad faith is when the respondent registers the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct. In Julia Roberts’ case , the domain name juliaroberts.com registered by the respondent was transferred to her since domain name hijacking is evidence of bad faith.
The third circumstance, which leads to inference of bad-faith, is when by using the domain name, a party has intentionally attempted to attract, for commercial gain, internet users to its website or other online location by creating a likelihood of confusion with the trade or service mark of the complainant. For instance, where a person registers a domain name reebuk.com in order to divert domain name traffic from reebok.com.

However, domain name disputes are not always between a person with a purely speculative reason for registering the domain name and a person with a legitimate interest. Sometimes both parties have a legitimate use and right to the domain name. The area of legitimate competing claims is the most complex in the field. According to UDRP, legitimate interests by the respondent over the impugned domain name can be claimed if before any notice to the respondent of the dispute, the respondent’s use of or demonstrative preparation to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services. In Tata’s case , the WIPO Centre held that the respondent is merely ‘hoarding’ the domain name ‘tata.org’ since the same was registered 3 years back without actvation.

Another circumstance of legitimate claim is when the respondent is making a legitimate non-commercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark. In Maruti’s case, the respondent had produced evidence that the domain name ‘maruti.com’ was registered on the name of his nephew, Tella Maruti Shrinivas and was not for commercial use nor was there tarnishment of the complainant’s trademark. On re-litigation it was found that the birth certificate of Tella Maruti Shrinivas was a forgery and the person is fictitious proving that the domain name was originally registered in bad faith and commercial use was being made misleadingly diverting the complainant’s customers tarnishing Maruti’s trademark. But it is not always a foregone conclusion - last year the international body, which deals with disputes found in favour of a Mr A. R. Mani, after the fashion giant Armani claimed it should own ‘armani.com’.

But the protection of intellectual property on the Internet remains a grey area whereby everyone in the cyberspace remains vulnerable at the hands of the cyber-squatter due to the lack of definite principles not only to resolve but also prevent such misdemeanours in the virtual world. Although approaching a forum, such as the World Intellectual Property Organisation is advantageous from the jurisdiction point of view, ICANN’s procedure is limited to a select set of circumstances, commonly referred to as bad faith registrations.

Therefore, for adjudication of more complex trademark issues, such as competing rights case, one would have to approach a court of law. Secondly, the UDRP relief is limited to either getting the domain name struck off or transferred, as opposed to a normal judicial proceeding, which would permit the grant of damages, in lieu of or in addition to the remedies in the UDRP. Even the Information Technology Act, 2000 fails to address the issue of trademarks on the Internet creating a discrepancy of sorts. Apart from legislations, awareness about the Internet and its potential is also essential in reducing such offences. For instance, if Sachin Tendulkar wants to develop a website with domain name www.sachintendulkar.in, he will now have to buy it from a British gentleman named Mathew Mayer. International celebrities like Pierce Brosnan, Jimi Hendrix, Sting, Madonna, Bruce Springsteen, Steven Spielberg and several others have faced the notorious domain squatter and now the Indian celebrities and companies are under a similar threat. Awareness in the wake of such a threat is imperative in countering the same. Therefore owing to the global nature of the Internet, any policy, in order to be effective, has to be uniformly accepted and enforced in different parts of the world. And its efficacy will hinge on the demystification of technology wherein the same will be made intelligible to the masses that are still oblivious of the evils of technology abuse.

Endnotes:
Panavision Int’l, L.P. v Toeppen, 141 F.3d 1316,1319 (9th Cir.1998) AIR 2000 Bom 27 (1999) 19 PTC 201
Helen Folsade Adu known as Sade v. Quantum Computer Service Inc,
http://arbiter.wipo.int/domains/decisions/html/2000/d2000-0794 (last visited on September 07 2007)
Suit No. 179/ 1998 (Del)
(1999) 19 PTC 201
Madonna Ciccone aka Madonna v. Dan Parisi and Madonna.com
http://arbiter.wipo.int/domains/decisions/html/2000/d2000-0847 (last visited on September 07 2007)
Satyam Computer Service Limited v. Vasudeva Gokaraju,
http://arbiter.wipo.int/domains/decisions/html/2000/D2000-0835.html (last visited on September 07 2007)
(1998) F.S.R. 265
http://arbiter.wipo.int/domains/decisions/html/2000/D2000-0210 (last visited on September 07 2007)
Tata Sons Ltd v. The Advanced Information Technology Association,
http://arbiter.wipo.int/domain/decisions/html/2000/D2000-0049 (last visited on September 07 2007)
Maruti Udyog v. B. Tella Rao,
http://arbiter.wipo.int/domain/decisions/html/2000/D2000-0518.html (last visited on September 07 2007)

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