A company’s name and logo make its products and services distinguishable from any other business and may be protected by a trademark registered with the United States Patent and Trademark Office (USPTO). A trademark is considered property of the business and has a tangible value, as it is used by the public to associate a particular good or service with its source. Often, business owners spend a great deal of resources developing their mark in traditional commerce while leaving its online identity an afterthought. Ignoring a business’s internet presence could potentially result in dilution or loss of the mark on the World Wide Web (WWW).
Internet domain names are commonly referred to as “website addresses” and begin with “www.” However, an actual website address is a sequence of numbers (i.e. 220.127.116.11) and a domain name is the way for internet users to easily recall or access a unique numerical address. In order to obtain a website address, an individual or company applies through a domain name supervisor, such as GoDaddy.com and Gozerdomains.com, who is authorized by The Internet Corporation for Assigned Names and Numbers (ICANN) to correspond with a specific numerical sequence on the WWW. Purchasing a domain name through a domain name supervisor is fairly inexpensive, but does not automatically afford special rights in the name unless it is used in commerce and/or subsequently registered as a trademark.
An internet domain name may be registered with the USPTO if it is functioning both as domain name (address) and also as a trademark. The mark should have a distinctive component and be used as a source indicator apart from just being listed in the address line of the browser. However, in order to receive protection for an internet domain name, just as with a traditional trademark, the name must be distinctive, famous, or take on secondary meaning, as opposed to merely a generic (i.e. “wolf”) or descriptive (i.e. “red”) term.
Before beginning to use a mark, a business should determine whether another business already uses an identical or similar trademark on or in connection with the same or related goods or services, regardless of whether or not the business has an internet presence. Also, before devoting time or resources to marketing a name, a company should check to see if a specific desired domain name is actually available. However, even if a particular domain name is already taken, it may not necessarily be in use. The owner of the name may be willing to abandon the name or sell the rights to the name.
There are a number of problems that could arise if a thorough clearance check is not performed prior to successfully securing a domain name. Sometimes, the domain name contains another company’s existing trademark. While this registration may be a defendable and legitimate use of the name, if the owner is found to have registered the domain name in bad faith, he or she may face significant penalties if an infringement action is brought. Other examples of bad faith registration include: a competing business registering a similar mark with an intent to profit from a consumer’s confusion, third party registration with the primary purpose of selling, renting or otherwise transferring the domain name registration to a business’ competitor, or a company registering its main competitor’s mark to prevent the competition from utilizing the name online.
The Anticybersquatting Consumer Protection Act (ACPA) was passed to provide trademark owners with effective ways to combat cybersquatters and other entities from infringing, diluting or unfairly competing with a registered domain name. Additionally, ICANN has implemented a Uniform Domain Name Dispute Resolution Policy (UDRP) as a streamlined, cost-effective way to resolve disputes about domain names. However, unlike traditional trademark and unfair competition claims brought under federal trademark statutes, consumer protection is not the main purpose of the ACPA. In fact, the mere act of registering a domain name may violate the ACPA even if the domain name is never used or made available over the Internet.
As competition forces companies to put more and more information, products, and services onto the Internet, Internet domain name disputes will inevitably become more common. Whether avoiding an infringement on someone else’s mark or defending against others claiming your business’ identity online, early consultation with legal counsel is critical to protecting valuable assets of a company.
Carla G. Testani is a partner in our Livonia office. She may be reached at (734) 261-2400 or firstname.lastname@example.org.