When Apple recently won a high-profile adjudication against a small UK company in a dispute about the ownership of a domain name, the decision provided food for thought for businesses trading or looking to set up shop on the internet.
The case centred on the registration by CyberBritain Holdings of the www.itunes.co.uk internet domain. Despite the domain having been registered two months before the launch of Apple's own site, www.itunes.com, Nominet - the UK body responsible for ruling on such disputes - concluded the computer giant had brand rights and found in its favour.
So does this mean that the principle of "finders keepers" does not apply to domain name registrations? It is certainly finders keepers at the outset. All that has to be done is to check that the selected name is still available, and then register it.
Things get more complicated when the successful registrant receives a notice from another party alleging a better claim to the domain name. Where an amicable agreement is not reached, matters may proceed to court or be decided under a dispute resolution policy.
Nominet rules on disputes concerning .uk registrations. To succeed, anyone applying for the transfer of the registration must show they have similar or identical rights to the registered domain name: for example, a trademark or established trading name. They must also show the registration was "abusive", by demonstrating, for instance, that the domain was registered in a bid to sell it to the complainer.
In the Apple case, the domain name was handed over because of CyberBritain's "bad faith" in using it merely to redirect users to another of its sites, having previously tried to sell the registration to Apple for £50,000.
For top-level domains, such as .com, the dispute procedure is governed by the Uniform Dispute Resolution Policy (UDRP), which is administered by the Internet Corporation for Assigned Names and Numbers. The essential points to consider here are whether the domain name in question is identical or similar to the complainant's trademark; whether the company that has registered the domain has a legitimate interest in the name; and whether there is a suggestion of bad faith behind the registration. If the expert finds for the complainant on all three points, the domain name will be transferred.
Although both these procedures are used widely, they are not law and occasionally the courts have departed from their approach. Most notably, this happened in the "sucks" cases, where a well-known, trademarked name was registered with the suffix "sucks" in a bid to undermine the relevant company.
The practice under the UDRP has been to order the handover of such sites to their respective trademark owners, but a US court recently declined to do this. It argued the site, as registered, was not a commercial one and so could not be said to be infringing the trademark owner's rights. This differing viewpoint from that under the UDRP can lead to confusion.
Protecting chosen names
Although the element of bad faith meant CyberBritain Holdings lost its right to the itunes registration, it raised the question of what companies should consider when setting up a website. How can they protect their chosen name, especially when they may be unaware of new services that have yet to be launched?
It is important to carefully consider the name being selected and conduct a search to ensure it is available. Think about why the name has been chosen - does it relate to a company product, to an established trading name, or its own trademark?
Another useful precaution is to conduct a search on the public registers to check the chosen name does not conflict with any marks already registered at the Patent Office or company names registered at Companies House. Although a match here will not necessarily rule out the domain name, it will highlight any potential clashes.
By following these simple steps, companies should be able to safeguard their domain name registration and strengthen their position in the event of an Apple-type challenge.
Gillian Cameron is a partner and IP specialist with corporate lawyers Maclay Murray & Spens