Extending the ‘passing off’ remedy of Trademark to domain names

Domain Name

In the general parlance we know that a Trademark is used to identify the products or services from a particular source (the Company from where the goods/services originate) , for example at the very moment the device through which this article is being accessed, be it a laptop, tablet, phone etc. has a Trademark say Dell, Sony, Apple, Nokia, Nexus etc. Due to the wide reach of internet to the users, almost all the companies have a website where the products and its specifications are displayed. Every company obtains a domain name and usually companies desire to obtain such domain names similar to the Trade mark of the company for the ease of users to relate. For example,consider 'Cipla' which is the Trade mark of one of the largest generic drug manufacturer in India, has the domain name of the Company as "www.cipla.com". 

The important question that would arise is ‘How does a domain name satisfy the characteristics of a trademark, thereby invoke a remedy for passing off?’ This can be understood by looking into the decisions of High Court and Supreme Court.The vacuum formed due to lack of legislation in this area has been filled by the Indian judiciary (The domain name disputes can be resolved through Uniform Domain-Name Dispute-Resolution Policy (UDRP) where there are Approved Dispute Resolution Service Providers like WIPO – it is not the area of our focus).

Let’s decipher the concept of passing off and later extend it to domain names.

Trade mark (as defined in Section 2(1)(zb) of The Indian Trademark Act, 1999): means a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include shape of goods, their packaging and combination of colors.

Passing off: A company would establish consumer base, goodwill and reputation through its goods and services; Passing off is the act of gaining advantage (by misrepresentation) of the established goodwill of the former.The prior user of the mark has an added advantage. As stated by P.Narayanan, an established author in intellectual property law,few examples of passing off are[i]:

• False representation;
• Adoption of a trade mark either in whole or in part;
• Colorable reproduction of trade mark;
• Copying the label, scheme or get up of the mark.

Also, the passing off remedy can be invoked by non-registered users also unlike a remedy for infringement which is only provided for registered users, so this is the only form of remedy in case of domain name. 

A Trademark should be capable of distinguishing the goods or services of one from another whereas passing off is an act of gaining advantage by misreporting the goods or services of another. Passing off is against the primary purpose of the Indian Trade mark Act, 1999 (herein after referred as “the Act”) which can be inferred from the preamble which says “An Act to amend and consolidate the law relating to trade marks, to provide for registration and better protection of trade marks for goods and services and for the prevention of the use of fraudulent marks.”The common law right against passing off can be enforced for protecting the goodwill of a trader. This right has been included in the Act and has been extended to protect the right of unregistered users.

In the ErvenWarnink B.V. v. J. Townend & Sons (Hull) Ltd., [1980] R.P.C. 31, famously known as the Advocaat case, a five element test was laid down by the House of Lords to establish a valid cause of action for passing off (which has been cited by the Delhi Court in series of cases). The apex court in the case of Laxmikant V. Patel v. Chetanbhat Shah &Anr., [2002(24) PTC 1 (SC)] laid the classical trinity test as:

1. Plaintiff must establish goodwill associated with the goods or services

2. Misrepresentation by the defendant

3. Plaintiff must show that he suffered a loss.

The first case on passing off in domain names came up before the Delhi High Court in the case of Yahoo! Inc. v. Akash Arora nand Anr.,[1999 PTC (19)210 (Delhi)], in which the plaintiff owned the domain name “www.yahoo.com”. The defendant was using the domain name “www.yahooindia.com” in relation to internet related services which is the similar field in which the plaintiff is operating. So, the plaintiff alleged that by using a quite similar domain name and format to their domain name there is an act of deceit and “Passing off”. Thus by applying the principles of “passing off” the court passed an injunction.

There were similar disputes dealt by the courts in similar circumstances but the most important case is Satyam Infoway Ltd. v. Sifynet Soloutions Pvt. Ltd.,[2004 (28) PTC 566 (SC)]. The appellant in this case, incorporated in 1995, registered domain names like “www.sifynet”, “www.sifymall.com”, “www.sifyrealestate.com” etc. in 1999. The word ‘SIFY’ is a coined word adapted from ‘Satyam InFowaY’. The defendant has obtained the registration for the domain names “www.siffynet.com” and “www.siffynet.net” in 2001 and 2002 respectively. The respondent has contended that a Domain Name could not be confused with "property names" such as Trade mark. In this case the principal questions raised were:

1. “whether internet domain names are subject to the legal norms applicable to other intellectual properties such as Trade marks?”

and

2. “whether a domain name can be said to be a word or name which is capable of distinguishing the subject of trade or service made available to potential users of the internet?”

The Apex court has held with regard to the questions raised stating that:

• The internet has become a mode for commercial activity rather than a mere means of communication;
• Domain name identifies the specific internet site, it may pertain to provision of ‘services’ within the meaning of Section 2(z) (the ‘domain name’ identifies a‘service’ which is the website, so it qualifies to be a Trade mark);
• Trade marks containing same name can co-exist but the distinctive nature of the domain name providing global exclusivity is much sought after. The fact that consumers are likely to guess a domain name has enhanced its value.

In relation to first question of passing off, the court has applied the classical trinity test:

• The evidence (newspaper publication and user base) provided by the appellant shows that it has good will;
• It is evident from the facts that appellant is the first user;
• There is likely hood of confusion (‘sify’ & ‘siffy’), with possible injury to the public and consequential loss to the appellant.

Holding that the respondent has dishonestly adapted the domain name to free-ride on appellants, the Court upheld the injunction.

The recent case of Crayons Advertising Ltd v. Crayon Advertising, of Jan 17, 2014, is also a similar domain name dispute. The disputed domain names are “www.crayonad.com” and “www.crayonadv.com” of plaintiff and defendant respectively. In this case also the Delhi High Court has iterated the same principal and this is the case which has ignited the thought in these lines.

It can be concluded that a domain name qualifies to be a Trade mark and is used to identify the source of the “services” (which is the website) provided by a person. In case of any act of deceit and passing off by a person, for using a domain similar to that another person, the latter, by proving the elements of classical trinity test and prior use, can get an injunction against the mala fide user. The Indian judiciary has played an active role by filling the gaps formed by the lack of legislation in this area by extending the passing off remedy of Trade marks to domain names.

Abbreviations:

PTC – Patent & Trademark Cases.

R.P.C – Reports of Patent Cases

SC – Supreme Court

[i]Sreenivasulu N.S, “Law Relating to Intellectual Property”.Partridge Publishing, 2013.Page 114. 

Author - Murthy Yeggina

Disclaimer: This blog or any post thereof is not to be considered to be in any way associated with the official stand of IIT kharagpur or RGSOIPL on the issues being discussed in the said post. The opinions on the blog are the authors own and should not be considered as legal advice.

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“Crystal is not glamour free”

Market is dynamic in terms of in-flowing products, consumer behavior and goodwill of a business. It is, therefore, crucial for a businessperson to defend his/her product(s) in the name and style of its trademark. The question of trademark protection becomes pertinent when the trademark is not in use for quite some-time. Does it mean that the consumer will forget the brand? Does this mean that the market dynamics will change the numbers or prestige of goods? Does the registered user be allowed to take leverage of its market reputation even long after abandoning the trademark? What if any other businessman wanted to revive its business with some trademark which may resemble its previously abandoned trademark?

IPAB has made this proposition clear with the issuance of an order on January 3, 2014 to remove the trademark “Crystal Glamour” owned by Austrian crystal jewellery and fashion accessories company Swarovski Aktiengesellschft under No.1134456 in Class 25 (Trademark classification for clothes). The mark has been applied for registration in the year 2002 and registered in 2005. The company (in a letter dated December 18, 2013) communicated to the registrar of trademark that the registration has lapsed and they have no interest in renewing the registration. Instead of which they requested to allow for rectification. They wanted to drop ‘Glamour’ from the trademark which flagged the applicant, “Crystal Knitters” based in Tirupur, since they are the registered trademark owner of ‘Crystal’. The applicant adopted this trademark in 1971, got it registered, has paid renewal fees timely and is still commercially active. The applicant has argued that they have extensive public identity and it has built itself as popular brand. It has statutory as well as common law rights over trademark ‘Crystal’ and copyright in the artistic work relating to the manner in which the mark is represented.

 The applicant argued further that –

Ø The trademark ‘Crystal Glamour’ was not in use for 5 years or more,

Ø The trademark registration fails by virtue of section 9 & section 11 of the Trade Marks Act, 1999,

Ø That the Trademark was obtained without the bona-fide intention to use the same and they were more of looking to use the applicant’s trademark and its reputation in the market,

Ø That the trademark of the defendant was ‘neither distinctive nor capable of being distinguished’,

On service of notice regarding the application by the applicant, respondent did not file any counter statement but responded with a letter informing that they are no more interested in the application. The applicant insisted on hearing which the defendant did not attend. Applicant contested that the word ‘glamour’ was dropped and the only word remaining was ‘crystal’ which is registered trademark of the applicant.

The board observed that the applicant has adduced all the relevant documents to substantiate their contentions. The defendant had the prior knowledge of the applicant’s trademark and therefore, concurrent use or innocent infringement situations are ruled out. Furthermore, the defendant has requested to allow the rectification petition. The board therefore, concluded that the application be ordered with a direction to the registrar of Trade Marks to remove/cancel the trade mark “Crystal Glamour” registered under No. 1134456 in class 25.

Conclusion -

Chapter VI of the Trade Marks Act, 1999 dictates the use of trademarks and registered user. Section 47 of the above-mentioned Act provides that the application for ‘removal from register and imposition of limitation’ are permitted after 5 years and 3 months from the date of register of the trademark, on non-use situations. Defendant seems to have lapsed its statutory rights to revive its trademark ‘Crystal Glamour’. Though, it seems irrelevant on behalf of the defendant to contest the opposition since they are no longer intending to use their registered trademark. Also, it is waste of time, energy and money if the businessperson is no more using or willing to commercialize the particular trademark.

The statutory provision mentioned above indicates that there is a fair chance that a consumer will forget a brand after certain time if that trademark is not in use, unless of course it is a well-known trademark. It is however very difficult to draw limitations on reputation in terms of time and economics for goodwill. But, the trademark law dictates that one shall not be allowed to hold IP rights if they have abandoned it for continuous long term. It is therefore paramount to fortify one’s trademark, its associated common law rights and statutory rights.

IPAB decision can be seen ‘ here.’

Author - Manish kumar

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