A registered trade mark can be infringed under section (10) of the Trade Mark Act:
- Section 10 (1) of the TMA provides that if a sign that is identical to a registered trade mark is used in the course of trade in connection with identical goods and services for which the mark is registered then there is infringement. There is no need to show any likelihood of public confusion.
- Section 10 (2) of the TMA provides that if an identical or similar sign is used in conjunction with identical or similar goods for which a mark is registered then there is infringement if there is a like likelihood or public confusion.
- Section 10 (3) of the TMA provides that a registered trade mark is infringed in the UK is a similar or identical mark is used in relation to goods or services which are not similar to those for which it is registered, where the trade mark has a reputation, and the use of the sign without due cause takes unfair advantage of or is detrimental to the distinctive character or repute of the trade mark.
Section 10 (1) of the TMA
In Avnet Inc v. Isoact Limited (Avnet) the owner of registered trade mark tried to use trade mark law to take the name ‘avnet.co.uk’. Avnet Inc., a US company, provides business goods by catalogue and at the same time it runs advertisements for different manufacturers. It registered its name in the UK in class 35 providing advertisement and promotional services. Isoact Ltd, an Internet Service Provider, uses Aviation and Avnet and thus taking the domain name as avnet.co.uk allowing customers to display their own advertisements on its site.
Avnet complained that Isoact used the name ‘avnet’ in its domain name and hence infringing its registered trade mark. Avnet relied on section 10 (1) of the TMA saying that Isoact used the same trade mark in connection with the same goods and services. Jacob J disagreed with Avnet arguing that Isoact was not providing the same goods and services but Isoact was rather an Internet Service Provider which falls under within class 42. Isoact had a right to keep its domain name and there was no infringement involved.
The case was noted for its judgment. Firstly, Jacob J knew how to keep the monopoly of each individual rights under check and would not allow those rights to go beyond what was permitted. Secondly, Jacob J checked for the registered good and services and pointed out that those who registered for trade mark had to be careful in keeping their specifications within limit if the monopoly claimed was not to be seen as too wide. And if it is too wide, it will be struck the register for non-use. Avnet had already a prior registered trade mark, there was no question of that right taking precedence over an unregistered right where there was no overlap between the services provided by the right holders. The domain name was not considered as a trade mark. But however, when there is an argument over the same identity of the registered trade mark, for instance the marks are identical on particular style of font in connection with the logo of the company, it has always been decided that identical does not necessarily the same thing and that external matter should not considered when it comes to comparing a mark with a sign. It should be noted that domain names only comes with simple type, therefore if it is argued, the words used should be decided and not on the matter of how it was presented. If an address of ‘wetwetwet.com’ were registered by the publisher for the sole purpose of selling covers for books with the words ‘wet wet wet’ then it would infringe the rights of Bravado Merchandising (Services) Ltd which has a registration of the stylized words for just that purpose.
Learning from the case of Avnet, we can confidently say that if you register for a trade mark or a domain name which someone else has already held which incorporates a same mark, then you got to be sure that the registration for goods and services are identical to those being traded on the web site, otherwise you will not be able to argue and to win your case with the domain name using section 10 (1) of the TMA. It is also important to note that a registered trade mark does not give a ‘right’ to a domain name, thus the need to secure domain name registration as soon as possible.
Section 10 (2) of the TMA
In Avnet Jacob J resolved the case on the confusion matter rather than identity between trade marks, and therefore an infringement might closely link to section 10 (2) of the TMA. It can be said that he could rely on cases under this section to arrive at conclusion.
In British Sugar plc v. James Robertson & Sons it was argued that the word Treat used by James Robertson in relation to a toffee flavoured infringed the trade mark ‘Treat’ which had already been registered by the British Sugar company in connection with dessert sauces and syrups. The argument to see whether there was an infringement was divided into three parts. Firstly it was considered to see if there was any similarity of the mark with the sign, secondly to explain the concept of similarity between the goods and services; and thirdly to consider whether there was a possibility of confusion because of that similarity. In this case the court argued that the trade marks were the same, but the goods were not, taking into account of the uses of the products, the locations and the food sectors into which they categorized.
If the domain name was identical to the registered trade mark, then the goods and services covered by the registration would need to be considered whether they were the same and whether it fell under the guidelines drawn in British Sugar company. If they were not the same then there would be no infringement. And if they were the same, then the court will consider the matter to see if there is a likelihood of public confusion. Going back to the case of Avnet Jacob J explained that the real concern of that case was not about Isoact competing with Avnet, but it was all about confusion when a search engine returns a hit on a particular site, over which ‘Avnet’ has been found. Jacob J went on to argue that it is very difficult to see how such confusion could occur. For instance, a surfer found the site, he or she would find aviation products instead of electronic products. The confusion here is not the goods and services but is rather the hits the search engine returns and this is not a matter for the trade mark law.
In Canon Kabushiki Kaisha v. Metro-Goldwyn-Mayer Inc. the European Court of Justice ruled that the first and foremost important factor in considering liability under section 10 (2) is the character of the trade mark and in particular its reputation. The more distinctive the mark the more reputation it signifies, the wider the ambit of goods and services which would be determined for the similarity to those represented by the trade mark, which in turn more likely to present more confusion. Hence a distinctive and well-known trade mark will have the protection over most of their goods and services.
It is considered that it is much easier to claim for protection under section 10 (2) than section 10 (1) for the apparent reason that the trade mark has a distinctive character and a reputation. Avnet is certainly a distinctive character and it will probably have been used over many years in the course of trading, so its reputation will rise over those years. Giving the likelihood that the two companies – Avnet and Isoact – providing the same services, it will not be difficult for the court to decide that they present some confusion and this will lead to infringement under section 10 (2) of the TMA. Unless if it is accepted that the confusion occurs when a surfer randomly search, then it will become clear that he has come to the wrong site.
Section 10 (3) of the TMA
This particular section of the TMA provides questions of trade marks. It is used to deal with the problems of cyber squatters and it is considered recently in One in a Million. In this case there were a number of domain names used the words One in a Million including marksandspencer.com, bt.org, and others. It was decided by looking to the law of passing off and by some existing principles. The court declared that the defendants had created instruments of deception. Hence the domain names had to be returned back to the trade mark and brand owners. But however, the case was argued that the implication of the case was not at all clear even if the passing off was made.
When it comes to deal with section 10 (3) Aldous LJ considered the domain name was the trade mark, hence it takes the advantage of the distinctive character and reputation of the marks which was looked upon as unfair and detrimental. And so section 10 (3) was infringed and it left a number of unanswered questions.
Some of these questions were what is a mark with a reputation, and which would fall under this provision? What is meant by taking advantage of the distinctive character or repute of a mark, more commonly known as dilution? And what is the relevance for Internet domain names? These questions will be considered individually in turn.
What is a famous mark with a reputation?
These famous marks are well known marks which are called for protection in respect of dissimilar goods and services, with it comes a series of certain conditions. For instance, the use of infringing sign would indicate a connection in the course of trade between the owner of the mark and the goods and services belonging to the third party and that the interests of the owner of the well-known mark are likely to be damaged by such use.
In considering reputation, Mostert indicates that a lower evidentiary threshold is needed to establish that a mark has a reputation, that is to say the name has been registered ‘in the sense of being exclusively associated with the owner’s goods or services’, hence protection could be extended to marks which are neither famous nor well-known.
Many jurisdictions have created certain guidelines on what calls a famous or well-known mark, and when these marks are to get special protection something need to be done if they can be distinguished from others. A starting point would be to ensure that these marks are to be kept as low and few as possible. By keeping the number low prevents the names to be taken out and used by third party.
What is Dilution?
Dilution can happen in two ways, that is to say reputation can either be blurred or be tarnished. Blurring can cause erosion or watering down the distinctive quality of the trade mark. For instance, Kodak becomes a famous name for cameras and films, but when used on a wide variety of dissimilar products, its ability to call in mind films and cameras decreases. While using the trade mark could tarnish the ability of the mark to call in mind positive associations with the goods and services. For instance, a number 4711 is a well-known trade mark of a perfume in Germany, but this number is prohibited to be used by a sewer company when it appears on the side of the van even if it is only the telephone number of the sewer company.
In the UK the courts have been struggling with the concepts of dilution. The case Oasis Stores Ltd’s Trade Mark Application raised some interesting comments. An application was made to register the mark ‘Eveready’ for products of contraceptives and condoms, but was challenged by the Ever Ready Ltd, the company provides products of batteries, torches, plugs and smoke alarms, it claimed that ‘Eveready’ has infringed section 5 (3) of the TMA.
The court decided that being reminded of a similar trade mark with a reputation for dissimilar goods did not amount to taking an unfair advantage of the repute of that trade mark. Furthermore, section 5(3) was not intended to have the sweeping effect of preventing the registration of any mark which was the same as a trade mark with a reputation.
When considering the detriment the court could take into account a number of factors such the inherent distinctive of the earlier trade mark, the extent of the reputation, the range of goods and services, the uniqueness of the mark in the market place, and the goods or services, though dissimilar, were in some way likely to be sold through the same outlets.
What is the Relevance for Internet Domain Names?
When a trade mark is registered for a domain name, that name is protected if it is used as a trade mark. But however, when it is not used as a trade mark but is only used to indicate an address on the Internet and not to identify the source of specific goods and services, the name will not be considered as a trade mark.
Because of these distinctive differences it was suggested that there should be a number of rules or guidelines to protect the well-known or famous marks with disputes concerning domain names.
Procedural in Domain Name Dispute
When a dispute arises concerning which party should have been allocated the domain name in the first place, the court will consider whether the procedure followed was contrary to the terms and conditions of the registrar. If so, the aggrieved party may bring a claim against the registrar for breach of contract. It is noted that domain name is a public body subject to administrative law requirements such as act fairly, give both parties an opportunity to make representations and take into account relevant considerations and avoid irrelevant ones. Furthermore, the court will determine whether the name is sufficiently distinctive to be protected as a trade mark. Unfair competition laws can also protect names which have not been registered, if they have a reputation.
Although trade mark and unfair competition laws have resolved domain name disputes, but by no means they can be successfully resolved all because:
- In many countries, legal proceedings are expensive and slow.
- In conventional commerce, the same names can be used by different persons without any conflict. Because domain names are unique, therefore when one party registered for a domain name, it will be apparently unavailable to any other parties.
- Laws and courts are organized along national lines whereas the internet is international. A domain name is accessible throughout the world and its use can readily affect the business of a company operating in other countries.
The UK domain name registration system is similar to the US version. Nominet, the single registry for the TLD ".uk" also has a FCFS policy. The UK courts however, reacted quickly and harshly against cyber-squatters in a decision affirmed on appeal in July.
The case, known as "One in a Million" or "Marks and Spencer", involved a pair of ambitious young British who, like Dennis Toeppen of panavision.com renown, registered a slew of domain names in the US registry (NSI) incorporating famous UK trademarks and trade names such as marksandspencer.com, virgin.org, bt.org and spice-girls.net. Like our Dennis, these lads then attempted to resell their booty, posting details of availability on a website. Evidence included a letter to Burger King asking for £25,000 plus VAT for the domain "burgerking.co.uk." Eventually, Marks & Spencer and others joined as plaintiffs against One in a Million seeking relief under the UK's 1994 Trademarks Act.
The trial court found for the plaintiffs. Although it stressed that mere registration of a domain was not, in itself, passing off or infringement of a trademark, this pair of entrepreneurs evinced a pattern of activity that amounted to a threat of passing off because it was a "deliberate practice...with a clear intent to deceive people" as to the origin of the domain, "there being no other possible purpose for using it." This activity in itself constituted appropriation of the plaintiff's goodwill. The court not only ordered the defendants to transfer the NSI domain registrations to the plaintiffs, it also enjoined the lads from selling or using any similar domain names in the future. Lastly, the court burdened the squatters with costs and legal fees amounting to approximately £65,000. The Court of Appeal went along further legal grounds by holding that the mere registration of a domain name could be actionable either as fraud or as misappropriation of goodwill or as "taking unfair advantage of or...(being) detrimental to the distinctive character or repute of the mark" under the UK's recently-enacted trademark dilution law."
The "One in a Million" decisions will also relieve trademark owners from the necessity of registering multiple variants of their marks with Nominet. Coupled with an earlier case giving UK courts jurisdiction to resolve disputes where damage to plaintiffs' trademarks occurs in the UK regardless of the location of the parties (here a US plaintiff and German defendant) or their website servers (in Germany), the UK has become one of the safer cyber-havens for trademark owners.
In cases where the domain holder had legitimate, but unregistered named rights, two UK decisions have backed Nominet's FCFS policy, particularly in the absence of any compelling reason to favor the later domain registrant. The Pitman case involved two non-competing firms, both with common law trademark rights in the Pitman name. Against claims of passing off and interference with contract, the court ordered the domain transferred back to the earlier registrant, primarily because the later registrant had the domain for such a brief period, and suffered such minimal traffic, that there was no reason to think the public associated the domain with that party such that any confusion might arise.
Infringement of a registered trade mark can also constitute as a criminal offence where false mark applied to goods or services intending to be used for labeling or packaging the goods or advertising goods.
The Trade Descriptions Act 1968 further specifies that a person applies a trade description to goods if he uses the trade description in any manner likely to be taken as referring to the goods including the advertising of goods with a misleading domain name. And it is an offence under the TDA to provide services having known the statement is false with a misleading domain name.
It is possible for the complainant to start court proceedings for unjustified threats or for a declaration that it is entitled to use the domain name. The Domain Name Dispute Resolution Policy (DRP) procedures are usually cheaper than court proceedings and are likely to be:
- In cases of clear abuse;
- If the complainant does not have a presence in the domain name holder’s country;
- If the legal system of the domain name holder’s country is considered unsatisfactory and it is not possible or practicable to bring proceedings in another country;
- If the domain name holder can be said to be missing the domain name but not actually infringing any trade mark right of the complainant under conventional law;
- If there might be a serious challenge to the validity of the complainant’s trade marks in legal proceedings.
On the other hand, the complainant may prefer the court proceedings where:
- There is no satisfactory DRP for the domain;
- It is difficult to show ‘bad faith’ on the part of respondent;
- The dispute is not only limited to domain name;
- It is more reasonable to recover costs or damages through court proceedings
- Criminal damages are more available to the complainant.
SUMMARY
One can summarize foreign domain name decisions only by noting that cyber squatting is almost universally condemned. The legal reasoning being used by the various foreign magistrates cannot, however, be so simply defined. There are conflicting decisions within the same nation. Wildly divergent levels of technical comprehension seem to have led to somewhat inconsistent justifications. What is clear, however, is that in domain name litigation the judicial decision making process is becoming a global event. Regardless of the nation of origin, well-reasoned written opinions on the subject are being circulated rapidly and providing significant influence on those courts which are confronting these issues for the first time.
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Table of Cases
Trade Marks Act 1994 section 1.
Prince plc v. Prince Sports Group Inc (1998) FSR 21.
McCarthy, Trademarks and Unfair Competition (4th edition 1998).
Avnet Inc v. Isoact Limited (Avnet) (1998) FSR 16.
British Sugar plc v. James Robertson & Sons (1996) RPC 281.
British Telecommunications v. One in a Million, (Court of Appeal, Civil Div. 98/0092-95B7/23/98)
Marks & Spencer and others v. One In A Million and others, (High Court of Justice,ChanceryDiv.11/28/1997)
Mecklermedia Corp. v. D.C. Congress GmbH (T.L.R., March 27, 1997)
Pitman Training Ltd. v. Nominet UK [1997] F.S.R. 797 (May 22, 1997)
Canon Kabushiki Kaisha v. Metro-Goldwyn-Mayer Inc. (1998) All ER (EC) 934, (1999) RPC 117, (1999) 1 CMLR 77.
One in a Million (1999) 4 All ER 476, (1999) RPC 1.
Oasis Stores Ltd’s Trade Mark Application (1998) RPC 631.
Bibliography
Kiersten Conner-Sax & Ed Krol ‘The Whole Internet – The Next Generation’
Lilian Edwards & Charlotte Waelde ‘ Law & the Internet – a framework for electronic commerce.
DOMAIN NAMES: World Standard Set for Key Internet Disputes
Dispute Resolution Magazine
American Bar Association Section of Dispute Resolution
Winter 2000, Vol. 6, No. 2, p. 12
Domain Names – A Practical Guide – Simon Halberstam & Joanne Brook & Jonathan D.C. Turner. Butterworths Tolley
