Will the Domain Name Owner or Trademark Owner Win a Dispute?

Domain name owners frequently open their mail to find a letter from a law firm representing a trademark owner. These letters – called “cease and desist letters” by lawyers – demand that the domain name owner stop using the domain name, transfer the domain name to the trademark owner, and provide information about the dates of use and money made from the use of the domain name.

How should the domain name owner respond?

Should he tell the trademark owner to take a long walk on a short bridge? Should she try to “land the first punch” by suing the trademark owner? Or is there a better approach?

What Rights Do Domain Names Provide?

The first step in deciding how to respond is understanding what rights domain name owners and trademark owners possess. The courts and the agency which registers trademarks – the U.S. Patent and Trademark Office (PTO) – decided long ago that domain names confer no intellectual property rights at all. They consider domain names to simply be “virtual addresses”. They might be valuable, and they do provide some ownership rights, but they do not provide any intellectual property rights to the owner.

If you are a domain name owner, you might disagree with this rule, and believe that domain names should receive as much legal protection as trademarks. But that is not the rule.

What if the Domain Name Is Being Used as a Trademark?

On the other hand, if the domain name owner has used the domain name to sell products or services on the Web, such use might result in trademark rights. But this is only true if the domain name is also the “brand” name on your website. For example, if your domain name is “FastCars.com”, but your business name – as actually used on your website, on credit card charges to your customers, and on stationary is “Hewett Motors” – then you might not obtain any trademark rights in the domain name FastCars.com.

Many domain names are only used to drive traffic to your site, or to forward traffic to other sites. This kind of use alone does not create trademark rights.

What If the Trademark Owner Hasn’t Registered His Trademark Yet?

In most countries, the first to register a trademark with that country’s trademark agency owns the trademark. But that’s not true in the U.S. Here, trademark rights are created by use of the name while selling your products or services. In other words, trademark rights are not created by applying for or even obtaining a trademark registration; in the U.S., trademark rights are created by using the brand name in commerce. The first person to use that name in commerce owns the rights to the trademark. This rule also explains why – as discussed above- domain names only create trademark rights if the domain name is actually used as the brand name.

But What If the Domain Name Is Different from the Trademark?

A lot of people ask whether they have to give up their domain name when a trademark owner demands it even though their domain name is different from the trademark. It depends. If the domain name is “confusingly similar” to the trademark, then the trademark owner might win. “Confusingly similar” is a legal term which basically means that consumers are likely to be confused as to the source of the product or service.

The courts use the “sight, sound and meaning test”. Specifically, if the domain name and the trademark look similar when read on the web or written page, sound similar when read out loud, and mean more or less the same thing, then they are probably confusingly similar. For example, the domain name “OutboardMotors.com” is probably not confusingly similar to the trademark “Slow Boat to Paradise”. The domain name looks shorter than the trademark and contains different words. They sound different – there are no overlapping syllables. The meaning is fairly different: OutboardMotors sounds like a company which sells power boats or motors for boats, while Slow Boat to Paradise sounds more like a leisurely cruise-like vacation on the water.

In some cases, the person who thinks he owns a trademark might find out that he owns no trademark rights at all, because the name is “generic” or “merely descriptive”, and thus not entitled to trademark protection. So trademark owners need to make sure they have grounds for demanding that the domain name owner stop using his url.

The above is an oversimplification and only discusses some of the many issues involved in disputes between domain name and trademark owners. You should contact an attorney with expertise in these types of disputes for advice and in-depth analysis.

By |August 1st, 2014|Intellectual Property|49 Comments