The use of a trademark in a domain name

Keywords: intellectual property, means of individualization, exclusive rights, trademark, registration of a trademark, protection of the rights to a trademark, domain name, domain disputes, trademark and domain name, use of a trademark in a domain name.

In connection with the globalization and peculiarities of the modern information society, the widespread use of computers and the Internet the issue on the protection of the rights to a domain name as a unique means of individualization has become topical. The particular attention in the Russian and foreign practice is paid to finding and maintaining a balance of interests between the owners of domain names and the owners of the intellectual property subject-matters, in particular, trademarks.

The domain name is, in fact, a “website name.” This is a certain symbol (letter-digital) sequence, denoting a website name in the global Internet. Some researchers argue that currently the domain name, in its significance, is approaching to a trademark, a designation that serves to individualize the products of legal entities or individual entrepreneurs. The trademark may be a picture, logo, colour, a three-dimensional form, etc., however, for the purpose of considering the present issue, of course, the word or combined trademarks that consist of words or phrases or contain them along with the figurative elements play a decisive role.

The importance of a domain name in the promotion of products and services of the Russian and foreign manufacturers is universally recognized, however, it is not entrenched at the regulatory level. The issue remains to be topical: what is the correlation of the rights to a trademark and the rights to a domain name? Obviously, the person who has the exclusive rights to a trademark has an indisputable right to use it in the domain name of the website, which belongs to him. However, how is the issue on using in a domain name of the designation identical or confusingly similar to the trademark of another person, without the permission of that person solved?   

Part IV of the Civil Code of the Russian Federation establishes a comprehensive regime for the protection and use of trademarks. Chapter 76 of the Civil Code of the Russian Federation (“The Rights to the Means of Individualization of Legal Entities, Products, Works, Services and Enterprises”) contains exhaustive provisions on the following issues: the concept and kinds of trademarks, the criteria for the protectability and the grounds for the refusal of the state registration, the use of a trademark and the disposal of the exclusive right to a trademark, the entire process of the registration of a trademark, the termination of the exclusive right to a trademark, the protection of the rights to a trademark.

As to a domain name, its regulation is recognized as insufficient.  Thus, according to Paragraph 15 of Article 2 of Federal Law No. 149-FZ “On the Information, Information Technology and the Protection of the Information,” “the domain name is a designation made by symbols which is intended for addressing the websites in the Internet for the purpose of providing access to the information placed in the Internet.” The domain name is a part of the non-material assets of the company.

Unlike trademarks, for the successful registration of which it is necessary that the applied designation complies with numerous conditions of protectability, virtually any word designations expressed in letters and digits can be used in domain names. In addition, if the legal protection of a trademark is carried out strictly on the grounds of the territorial principle (the trademark is protected only in the countries where it is registered), the domain names have an extraterritorial nature: the administrator of a domain name is not actually limited in carrying out his activities.

It should be taken into account that many domain names are registered not for the commercial purposes – they are personal pages and blogs, projects of the public authorities, the information portals, etc. Therefore, the concept of a “domain name” has not a universal character, and the legal regime of such “non-commercial” websites can not be correlated with the legal regime of trademarks.

At the same time, the increasing number of websites and, accordingly, domain names is used and perceived by consumers as a means of individualization due to the widespread popularity of their owners and the products and services they manufacture.

In the issue of determining the status and significance of such “commercial” domain names, it is interesting to mention Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation No. 1192/00 of 16.01.2001 (the case on the claim for the prohibition of the use of a trademark in the domain name of the page in the Internet): “Modern commercial practice has shown that when choosing domain names for the Internet, the owners of the information resources make a decision to choose the most simple and logical names (a word, a group of letters, etc.) that are usually associated by consumers directly with a particular participant in the economic turnover or with its activities.  Domain names have actually been transformed into a means that performs the function of a trademark, which affords to distinguish respectively the products and services of some legal entities or individuals from the homogeneous products and services of other legal entities or individuals. In addition, the domain names containing trademarks or trade names have a commercial value.”

However, the adoption of this resolution, in fact, has not affected the legal and regulatory framework and the judicial practice. The comprehensive legal regime for a domain name (in contrast to the legal regime of a trademark) has not been entrenched in the Russian legislation so far. As a result, in the event of a collision between the rights of the trademark owner and the domain administrator, the priority will be given to the owner of the exclusive rights to a trademark, and the disputes are settled in the majority of cases in his favor.

Here is how the issue on a collision of the rights to a trademark and a domain name is settled in the legislation.

Article 1484 of the Civil Code of the Russian Federation contains a fundamental provision stating that: “The person in whose name the trademark is registered (the right holder) has an exclusive right to use the trademark in accordance with Article 1229 of this Code in any way that is not contrary to the law (the exclusive right to a trademark), including by the ways specified in Paragraph 2 of this Article. The right holder may dispose of an exclusive right to the trademark.” Accordingly, “No one has the right to use without the permission of the right holder the designations similar to his trademark in respect of the products for the individualization of which the trademark has been registered or homogeneous products, if as a result of such use the possibility of confusion appears.”

In accordance with Paragraph 2 “The exclusive right to a trademark may be exercised for the individualization of products, works or services in respect of which the trademark has been registered, in particular by placing the trademark: ... 5) in the Internet, including in a domain name and with other ways of addressing.”

Obviously, the collision of the rights to a trademark and to a domain name is possible when the issue is about homogeneous products or services. According to the Rospatent's Methodological Recommendations (Methodological Recommendations for Determining the Homogeneity of Products and Services During the Examination of Applications for the State Registration of Trademarks and Service Marks approved by Rospatent Order No. 198 of December 31, 2009), “...When determining the homogeneity of the products, the principal possibility that the consumer will start to perceive these products as belonging to one manufacturer shall be defined. To establish the homogeneity of products, the following circumstances shall be taken into account: in particular, the nature (kind) of products, their consumer properties and the functional purpose (the scope and purpose of the use), the kind of material from which they are made, the complementarity or interchangeability of the products, the conditions for their sale (including the general place of sale, the sale through a retail or wholesale network), the circle of consumers, the traditional or preferential way of using the products and other characteristic features." The special situation is with a well-known trademark, the legal protection of which is also applicable to the products that are not homogeneous to those in respect of which it is recognized as well-known: “... if the use by another person of this trademark in respect of the indicated products is associated by the consumers with the owner of an exclusive right to a well-known trademark and may infringe upon the legitimate interests of such owner” (Article 1508 of the Civil Code of the Russian Federation).

The entrenchment of the indicated principle means, in fact, the priority of the right to a trademark in judicial disputes. However, even prior to the moment, when the use of a trademark in a domain name was recognized as referring to the illegal ways of the use of the trademark, the state bodies and courts had recognized the preferential rights of the trademark owner, including within the framework of the prohibition of an unfair competition. Thus, Article 10-bis of the Paris Convention for the Protection of Industrial Property, states that “In particular, the following shall be prohibited: all actions that are capable by any means of causing confusion with respect to an enterprise, products or industrial or commercial activities of a competitor”: this is also applicable to the use of someone’s trademark in a domain name without the permission of the right holder.

Obviously, the use by the administrator of a domain name of someone’s trademark with the intention to divert the consumers from the product or website of the very right holder, with the purpose of making profit from the reputation of the owner of the trademark, will be recognized illegal and unfair. In addition, many unfair administrators deliberately register such websites for the purpose of their subsequent resale to legitimate trademark owners, who may not want to spend time and money to filing a claim to court and to the protection of their rights. Further, the administrator of a domain name may intentionally place at such website the false or misleading information about the right holder of the trademark and his products, discrediting his reputation.

Of course, when considering the dispute on the illegal use of a trademark in a domain name, the court will take into account various circumstances, for example, whether the owner of the domain name has an unfair intention to make profit from someone’s trademark. The legality of the actions of the administrator of the domain name can be confirmed by the fact that he himself has the rights to the trademark or other intellectual property subject-matters used in the domain name, for example, the company name. Or that he uses someone’s trademark in good faith with the permission of the owner or for non-commercial purposes.

Summing up, it can be said that the domain name is now recognized not only as a means of addressing (a technical way of placing and finding the information in the global Internet), but also as a means of individualization – distinguishing the products and services of a particular manufacturer from a mass of homogeneous products and services of other manufacturers. Some researchers of this issue recognize the domain name to be even as a subject-matter of the exclusive rights, intellectual property. Such form of the use of a trademark, as its use in a domain name (legal or illegal) is recognized by law. However, it is obvious that the legal regimes of a trademark and a domain name are absolutely not homogeneous, unbalanced, and in the event of a dispute between the legal owner of the rights to the registered trademark and the administrator of the domain name containing the designation, which is confusingly similar with this trademark, in case of the homogeneity of products/services the priority will be given in the majority cases for the owner of the trademark.