In today’s tech-savvy world, where consumers increasingly rely on the Internet as a primary source of information and frequently engage in online transactions, businesses need to ensure that they protect their intellectual property assets on the Internet. One type of asset, trade-marks, becomes more important as consumers’ collective appetite grows for goods and services from throughout the global marketplace via the Internet, and as businesses strive to market and distinguish themselves from their numerous competitors. This article address one of the concerns about trade-mark abuse, in the context of website domain names.

Trade-marks

A trade-mark is a word, phrase, symbol or distinguishing feature that is distinctive and used to distinguish the owner’s goods and services from those of others in the marketplace. Some trade-mark rights are acquired by use in the historical industry and geographic space. More significant rights can be acquired through a registration process administered under the federal Trade-marks Act.

A trade-mark can be the legal name of a business, or a different name under which it has operated or established goodwill. It can be part of a more layered network within a portfolio of products and services, where several brands are used or licensed. One of the primary functions of trade-marks is to help consumers efficiently identify the source of a good or service.

Therefore, no matter what the context, it is important to police unauthorized use of trade-marks identical or confusingly similar to your own. If another business uses your trade-mark in association with its confusingly similar, but inferior, goods or services, consumers may be mistaken about their origin and believe you approve or endorse them, which can damage the goodwill associated with your trade-mark and business. In addition, you may lose legal trade-mark protection if you do not stop unauthorized use of an identical or confusingly similar trade-mark.

Cybersquatters and Domain Names

Domain names (for example, “blgcanada.com”) can contain important trade-marks, and are often critical in maintaining business-consumer relationships. Domain names can be registered by various approved registrars and are typically purchased for a relatively small fee on a first-come, first-served basis. Domain name registrars are not responsible for investigating the propriety of a registration.

One of the Internet threats to the value of a business’ trade-mark is the “cybersquatter”. Cybersquatters are entities that preemptively register, traffic in or use domain names that contain well-known trade-marks, or near spellings of them, in bad faith and without any right or legitimate interest in them.

Bad faith includes registering a domain name for the following reasons:

  • to sell the domain name registration for a profit to the trade-mark owner or their competitor;
  • to prevent the trade-mark owner acquiring the domain name;
  • to disrupt the business of the trade-mark owner; or
  • to use the domain name for commercial gain, to divert Internet users to the registrant’s website, by creating a likelihood of confusion with the trade-mark owner’s mark about the source, sponsorship, affiliation or endorsement of the registrant’s website.

Legitimate interests in domain names include use:

  • to clearly describe the source, method of production or characteristics of goods or services, or the nature a business;
  • to generically describe the goods and services offered by the registrant;
  • in association with good faith commentary, such as reviews, critiques or other non-commercial content;
  • to denote the geographic origin of the registrant’s non-commercial activity; or
  • as the name of the registrant.

The CDRP and UDRP

The registration and use of domain names are subject to trade-mark laws. While a lawsuit for “trade-mark infringement” or “passing off” may protect your trade-mark, there are also unique dispute resolution mechanisms that are more cost-effective and streamlined, and specifically for dealing with bad faith registrations of domain names.

A domain name registrant is bound by certain dispute resolution processes. For .com, .net and .org domain names, disputes may be resolved under the Uniform Domain Name Dispute Resolution Policy (“UDRP”). A UDRP proceeding is international. For .ca domain names, the Canadian Domain Name Dispute Resolution Policy (“CDRP) applies. If trade-mark owners wish to resolve their .ca domain name disputes under the CDRP, they must satisfy a “Canadian Presence” requirement or own a Canadian registered trade-mark.

Both CDRP and UDRP proceedings are relatively quick and inexpensive, because they are procedurally more streamlined than lawsuits, which involve document disclosure, cross-examinations of witnesses and in-person hearings. Under the CDRP and UDRP, a trade-mark owner’s only submission is a written “complaint” outlining the dispute, with supporting evidence. To be successful, a submission must establish that the registrant’s domain name is confusingly similar to the complainant’s trade-mark, that the registrant has no legitimate interest in that domain name, and that it was registered in bad faith. The registrant’s only submission is a written “response to the complaint”, also with any supporting evidence.

CDRP and UDRP decision makers are specialized in areas such as trade-mark law, Internet law and dispute resolution. They are required to render written decisions based on the complaint and response, and in accordance with the applicable CDRP or UDRP policy, rules and laws. Costs are generally borne by the complainant and amount to a few thousand dollars per domain name being reviewed. Depending on the process used, the time to receive a decision can be up to three months. If the decision is in favor of the complainant, there is a implementation period of 10 days with the UDRP or 60 days with the CDRP, during which the domain registrant can seek judicial review of the decision.

It is important to bear in mind that the UDRP and CDRP processes are limited, because they can only be used in the case of an alleged bad faith registration of a domain name. They are not available for other causes of potential conflict such as the competing use of similar trade-marks. In addition, the remedies under these processes are limited to either the cancellation of the domain name registration or the transfer of the domain name registration to the owner.

The availability of a CDRP or UDRP proceeding does not prevent trade-mark owners from using other dispute resolution options, including litigation, arbitration or mediation. The available remedies may dictate which avenue a trade-mark owner chooses to use against a cybersquatter. For example, a successful lawsuit makes available to a trade-mark owner remedies such as injunctions, monetary compensation and partial reimbursement of legal costs (though there may be hurdles in having such remedies enforced against overseas defendants).

Conclusion

Although the CDRP and UDRP domain name dispute resolution processes are limited in scope, they are generally effective and inexpensive ways to protect the value of your trade-mark from unauthorized use as a domain name. You should consider these processes among the available options in dealing with anyone cybersquatting on your rights.