1. Registration of Domain Names as Trademarks
Unlike the traditional trademark environment, where identical trademarks can coexist in different markets, in the domain name system a trademark can only be used in a single domain name. For example, there can only be one www.apple.com on the Internet, but there could be separate trademarks for Apple Computers, the Apple Grocery Store, Apple Clothing, Apple Records, or any of a variety of other product categories, as long as they are non-competing and there is no likelihood of consumer confusion. The USPTO and the CIPO will register an Internet domain name only if the name is also used as a trademark or service mark. The Lanham Act in the U.S.A. and the Trade-marks Act in Canada require that the mark must be used in commerce to distinguish the product in the marketplace and identify its source. The USPTO and the CIPO advised their examining groups that the suffixes used in Internet domain names (such as ".com," ".net," and ".org" ) are to be ignored when comparing marks, and that an applicant should not rely on these suffixes to avoid the likelihood of confusion proscribed by the Lanham Act and the Trade-marks Act. In choosing a domain name, the marks selected should be distinctive. Marks which merely describe a quantity or characteristic of the goods or services are considered weak and are generally not entitled for registration. Many Internet-related trademarks, as represented in federal applications, incorporate terms that could easily be considered descriptive, such as "Internet," "net," "Web," "cyber," and "online." Although such terms are considered desirable as trademarks, because they help users determine that goods or services are Internet-related, such terms should be used in conjunction with a fanciful or arbitrary term so that the overall mark makes a commercial impression as a source identifier and not a product or service identifier. If a mark is descriptive and therefore not inherently distinctive, the trademark may be protectable and entitled to federal registration if it has become distinctive and has acquired secondary meaning as a source identifier. A trademark may become protectable, for example, if the trademark owner has made substantially exclusive and continuous use of the mark for a period of five years. However, the difficulties in determining which marks are being used on the Internet may render it difficult to assert substantially exclusive use of a mark on the Internet. Therefore, it is imperative to select a non-descriptive mark.
2. The Legal Interface Between Trademarks and Domain Names
Distinctiveness is the very essence of a trademark. To be recognized under law as a trademark, a sign must aid the consumer to locate amongst the larger marketplace, those wares or services the consumer wishes to obtain. A trademark provides for the consumer information as to the source of wares or services. Ownership of a trademark does not confer on the owner any rights in gross or at large. Trademark law does not prohibit the use by another of the trademark as a domain name, but prohibits all uses of signs where such use creates a likelihood of confusion for consumers. Consequently, the fact that a person has registered a word or a variation thereof, which is owned by another as a trademark, does not mean that such person has, by such act, infringed or harmed the trademark.
3. Scope of Trademark Protection for Domain Names
The legal protection accorded to trademarks is not absolute, but is limited in three ways. (1) Trademark law is territorial in nature and depends upon local trademark use or reputation. It confers local or national rights, not extraterritorial rights. Accordingly different traders in other countries, without violating U.S.A and Canadian trademarks laws, may use trademarks used in the U.S.A. and Canada with respect to the same goods or services. (2) The U.S.A. and Canadian trademark laws do not provide the user of a trademark with ownership of the words or designs or the exclusive right to use the mark in all circumstances. Concurrent uses of the same or similar trademarks within the same areas of the U.S.A. and Canada may be permissible, depending upon the circumstances. (3) When a mark is not used as a trademark, then no trademark protection is warranted. The differences between domain names and trademarks are as follows: (1) Unlike trademarks, domain names are unique in that only one person may register a specific domain name. Many entities may be associated with one trademark (as long as the wares or services are different and there is no likelihood of confusion, but only one entity may be associated with a domain name; (2) The registration of a domain name containing a trademark may preclude legitimate uses of the trademark as a domain name in jurisdictions other than those in which the registrant is carrying on business. The registration of a trademark in one jurisdiction does not preclude the legitimate use of a same or similar trademark within that jurisdiction in the absence of a likelihood of confusion nor does it generally preclude, uses of a trademark in another jurisdiction; (3) Domain names, are not expressly referred to in any legislation (other than in the U.S.A. Anti-Cybersquatting Protection Act); and (4) Trademarks when registered are registered with government authorities in accordance with legally mandated requirements whereas domain names are granted through registration with non-governmental authorities in accordance with policies and on a first come, first served basis.
4. Domain Name Litigation
The ease of registration of domain names has led to widespread registration of famous trademarks and trade names as domain names. Domain name registration disputes have arisen in several contexts: (1) Cases of so-called "domain name piracy" in which individuals and companies have registered well-known trademarks as domain names in order to prevent the rightful trademark owners from using those trademarks in domain names. In some cases, domain name piracy has been used to obtain financial payment from the rightful trademark owner in order to regain use of the trademark in a domain name. This practice, known as cybersquatting, became so wide spread that in 1999 the U.S.A. enacted a federal law regulating such behaviour; (2) Cases of "innocent registration" of domain names that conflict with existing registered trademarks and service marks. In such cases, the original mark and the contents of the site being identified by the domain name may be completely unrelated and non-competing. There are various avenues for U.S.A. and Canadian trademark owners to dispute their claims and obtain relief, including in the U.S.A.: the Uniform Dispute Resolution Policy, the Anti-Cybersquatting Protection Act, the Federal Anti-Dilution Act, the Lanham Act; and in Canada: the Trade-marks Act and Copyrights Act.