What’s in a Name? Domain Names and Trademark Infringement

Editor’s Note: Angela P. Doughty is a member of the Business Section and Intellectual Property Practice Group at Ward and Smith, P.A.

RALEIGH — Selecting your business's domain name was easy. You chose a short, memorable name that gives your target consumer some indication of the nature of the goods or services provided on your Web site.

Business is booming until you receive a cease and desist letter from an attorney alleging that a client of the attorney owns all of the right, title, and interest in and to a trademark that is essentially identical to your domain name. The attorney claims that your registration and use of the domain name constitute trademark infringement of the client's trademark rights.

Should you throw the letter away? You registered the domain name in your name and, therefore, you own it, right? Unfortunately, if you obtain a domain name that is identical or similar to a trademark that you do not own, you may be liable for trademark infringement despite your proper registration of the domain name. You could end up as the defendant in a federal lawsuit brought under the Anticybersquatting Consumer Protection Act ("ACPA"), or you could become involved in an arbitration procedure brought under the Internet Corporation for Assigned Names and Numbers ("ICANN") dispute resolution rules.

Trademarks – Prevention of Consumer Confusion

A trademark is a distinctive word, phrase, name, symbol, or logo, or some combination thereof, used by a company or individual to identify and distinguish its products or services from the products and services of others. Trademarks are a type of protectable intellectual property used to identify a particular provider of a good or service. Trademarks are used for branding and advertising purposes and carry the goodwill and reputation of their owners.

In the United States, ownership rights in trademarks generally arise and are established by being the first to make commercial use of the trademark. The ownership interest in the trademark remains in effect as long as the trademark remains in commercial use. The owner of a trademark has the exclusive right to use it and to prevent other parties from using a trademark that is identical or even similar to its trademark. Although advisable, registration of a trademark is not required to give its owner the ability to enforce and protect the trademark. The protection and enforcement of trademarks are governed by federal, state and common law.

Generally, the purpose of trademark law is to prevent consumer confusion as to the source of goods or services and to prevent unfair competition. These purposes are accomplished by the use of the "likelihood of confusion" test that asks a simple question: could use of the challenged trademark or domain name cause a consumer of the goods or services to be confused as to the source, sponsorship, or affiliation of the source of the goods or services? If the answer is "yes," the challenged trademark or domain name fails the "likelihood of confusion" test. In other words, if a third party uses a trademark (or domain name) which is likely to cause confusion, mistake, or deception, that person may be liable for trademark infringement.

Domain Names – First-Come, First-Served

A domain name is a user friendly alias for an Internet Protocol address ("IP address"). An IP address is the location of a Web site on the Internet. Each IP address is comprised of a unique set of numbers (e.g., 78.523.098.432) that can be difficult to remember. To avoid using cumbersome IP addresses, IP address owners can apply to register an easy to remember domain name which will be associated with their IP address (e.g., www.google.com). The name portion of the domain (e.g., google) is the second-level name and is chosen by the IP address owner. This name, like the IP address, must be unique.

Registering a trademark at the state or federal government level is not enough to give the trademark owner rights to a domain name. If a trademark owner wants to use its trademark as a domain name, the owner must apply for a domain name registration with an ICANN accredited registrar. Domain names are granted on a first-come, first-served basis. The only criteria for securing a domain name is that no other individual or legal entity already owns a registration for the identical domain name.

By its nature, a domain name is not a trademark. A domain name is merely an informational part of an IP address. The key to determining if use of a domain name rises to the level of trademark usage and possible infringement is whether the domain name is viewed by consumers as a symbol of the origin of goods and services separate and apart from its use as a domain name.

Risk of Infringement – Can a Consumer Be Confused or Misled?

Unfortunately, the policies for domain name registration (first-come, first-served) do not correspond with the principles of trademark law (prevention of consumer confusion).

Applying the likelihood of confusion principles discussed above, a domain name owner could be liable for trademark infringement and be at risk of losing its domain name if a trademark owner convinces a court or arbitrator that the owner's use of the domain name makes it likely that consumers will be confused or misled as to the source or quality of the products or services offered through the Web site associated with the domain name.

Therefore, if a domain name has the potential for leading consumers to believe that the trademark holder somehow is affiliated with the domain name and the goods or services offered on the Web site associated with the domain name, then the trademark owner may bring a trademark infringement lawsuit under the ACPA or pursue arbitration through ICANN to seek the transfer of the domain name to the trademark owner and monetary damages.

Avoiding Liability

A business can reduce the chances that its domain name will infringe on a trademark by performing the proper due diligence before registering the domain name. Some suggested search tactics are as follows:

• Visit internet search engine sites such as Dogpile®, Google®, etc. to determine uses of the domain name by other businesses.
• Search WHOIS for domain names that are identical or similar to the desired domain name.
• Search the United States Patent and Trademark Office for pending and registered trademarks that are identical or similar to the desired domain name.
• Order a commercial search from a search firm such as Thomson & Thomson.

Keep in mind that trademark law protects not only the identical name, but also similar names; therefore, it is advisable to search for variations of spellings of the desired domain name (e.g., "cool" and "kewl").

Summary

Ultimately, it is the responsibility of the domain name registrant to ensure that the chosen domain name does not infringe on the trademark rights of another. A trademark owner has the right to protect the trademark and to notify domain name registrants that the domain name infringes upon that trademark. Doing research before choosing a domain name may help your business avoid unnecessary costs and headaches.

© 2008, Ward and Smith, P.A.

Ward and Smith, P.A. provides a multi-specialty approach to the representation of technology companies and their officers, directors, employees, and investors. Angela Doughty's practice focuses on the representation of clients with intellectual property matters, including the preparation and filing of copyright and trademark applications; the design and use of trademarks; and the sale, transfer, and licensing of intellectual property rights. Comments or questions may be sent to apd@wardandsmith.com.

This article is not intended to give, and should not be relied upon for, legal advice in any particular circumstance or fact situation. No action should be taken in reliance upon the information contained in this article without obtaining the advice of an attorney.