A recent ruling by the Federal Court of Australia has highlighted the need for businesses to carefully assess their market presence and methods of protecting their brand online.
In particular, the decision in REA Group Ltd v Real Estate 1 Ltd illustrated the practical benefits which can flow from registering trademarks used in a business, including the domain name of the business itself.
Each party operated separate and unrelated online real estate search portals. REA Group Ltd (REA) operated “realestate.com.au” (for residential properties) and “realcommerical.com.au” (for commercial properties, while Real Estate 1 Ltd (Real 1) operated “realestate1.com.au” (for residential properties) and “realcommercial1.com.au” (for commercial properties).
In addition to obtaining their domains, REA had also obtained trademark registration in respect of each of them, and commenced legal proceedings against Real 1, alleging that Real 1’s domains infringed upon their rights as owner of these trademarks on the basis that Real 1's domain names were substantially identical or deceptively similar to REA’s domain names, and were therefore likely to mislead consumers searching online for REA’s domains and/or concluding that the domains were related.
The Court first considered whether the domains and conduct of Real 1 constituted misleading and deceptive conduct for the purposes of s52 of the Trade Practices Act 1974. In rejecting REA’s contention, the Court made a number of key conclusions:
- The domain component “real estate” was used in slightly different ways in the domains of many businesses and therefore consumers would be more vigilant in the context of a market where close variants of "realestate.com.au" were common.
- A consumer would therefore be unlikely to associate the domains of Real 1 with those of REA despite the objectively small difference in the domain names themselves.
- Similarly, where a consumer searches for a real estate website and is directed to a domain of Real 1, the fault may lie with REA, as its domains are not sufficiently distinctive.
Notwithstanding this conclusion, the Court went on to consider whether Real 1’s domains infringed upon the rights of REA as owners of the registered trademarks (which were essentially the same as the domains).
In concluding that there had been an infringement of REA’s rights, the Court determined that there was a real danger of confusion in relation to "realestate1.com.au" in the context of domain names and the scanning process that occurs when looking at a search results page, as the "1" in “realestate1.com.au” and “realcommercial1.com.au” could reasonably be expected to be overlooked by consumers.
As a consequence, Real 1’s domains were determined to be deceptively similar to those of REA and therefore constituted trade mark infringement for the purposes of s120 of the Trade Marks Act 1995 (Cth).
What does this mean for Businesses?
This case serves to illustrate the benefits of trade mark registration from both a brand awareness and an enforcement perspective.
From a brand protection perspective, this case re-emphases the point that trade mark registration provides owners with a statutory monopoly over the usage rights of the trade mark for the goods and services to which it applies, thereby preventing others from using a similar trade mark in competition.
More generally, trade mark registration will also put an owner in a better position to restrain competitors from taking advantage of the valuable goodwill and reputation in the trademark and business as a whole. A particular point of note to come from this decision is the evidently lower threshold that is applied in determining trademark infringement as opposed to misleading and deceptive conduct. It is clear from the Court’s reasoning that even where the elements of a registered trademark lack a high level of distinctiveness, the rights of the owner will still be infringed by the use by a competitor of a deceptively similar trademark.
Practically therefore, and particularly given the relatively low cost of obtaining trademark registration, business owners should consider registering domain names as trademarks, as domain names are typically more generic than other forms of trademark (such as logos), and therefore may not provide sufficient distinction to support an action for misleading and deceptive conduct.