One of the first tasks in starting an online business is to purchase a domain name, such as aol.com, amazon.com, and ebay.com. The top-level domain is the.com,.gov,.cc.,.net, etc., of a web address. The second-level domain can be a company name, trademark, or industry buzzword. Obviously, no two domain names are the same. Over 33,000,000 domain names have already been registered, so finding a unique and unused name may be more difficult than appears at first glance.
The legal problems surrounding the registration of domain names most often involve trademark and service mark violations. Trademarks and service marks are words, names, symbols, or devices used by businesses to identify their products and services. Even if one finds a domain name that has not yet been registered, that does not mean that it will not run afoul of trademark law. Typically, the first to register a domain name is entitled to keep it. However, if one registers a domain name that has been previously registered as a trademark, he or she may be in violation of the Anticybersquatting Consumer Protection Act (ACPA), which created a new cause of action under Section 43(d) of the Lanham Act, 15 U.S.C. ¤ 1125(d). The ACPA contains penalties for bad-faith use of another’s trademark of up to $100,000 per domain-name violation. This law applies even if the trademark owner has not registered it as a domain name.
Similarly, if someone has used another person’s trademark for a domain name, legal action may be necessary. All domain names registered after January 1, 2000 contain ICANN’s (International Corporation for Assigned Names and Numbers) Uniform Domain Name Dispute Resolution Policy (UDNDRP), which requires all such disputes to be determined by an administrative panel. The only remedy under the UDNDRP for the bad faith use of another’s trademark is transfer of the domain name to the trademark owner. Even after such a determination, though, one may still seek redress in a court of law.
Sound legal advice is for a new online business to protect its domain name by registering it as a trademark first. A trademark may be obtained electronically at the Patent and Trademark Office web site using the Trademark Electronic Application System. Once individuals obtain trademarks, they may also then want to monitor the Internet for cybersquatters improperly using their trademarks. There are fee-based firms that will monitor usage of your trademark in the United States. Trademark owners may also avoid costs associated with hiring such a firm by doing manual searches for trademarks using search engines. Whois.net will find all domain names that contain the string of words a person’s wishes to check and may also provide the registrar’s name, address, e-mail address, and other useful information that can be used to begin an investigation as to whether such entity is cybersquatting.
However, the holder of a trademark right is not automatically entitled to the same domain name that uses the trademark. In Strick Corp. v. Strickland (E.D.Pa. Aug. 27, 2001), 162 F.Supp.2d 372, Strick Corp., a provider of transportation equipment and trademark holder of the name, sued a provider of computer consulting services that had registered the domain name Strick.com. Strick Corp. claimed there was blurring and dilution of trademark occurring when Internet searches using “Strick” as a search term encountered the alleged diluter’s web page and concluded that the trademark holder had no Internet presence. The federal court found that the use of Strick.com by the computer consulting company did not dilute the trademark and did not violate the Lanham Act or state law. The court determined that any initial confusion that arose from the defendant’s use of the domain name was not substantial enough to be legally sufficient. The judge also found that there was not “dilution by blurring” because a reasonable consumer would not associate the two uses of the trademark in his or her own mind. The sensible practice to avoid an inevitable lawsuit for using another’s trademark in a domain name is first either to hire an attorney to run a trademark search or check with the U. S. Patent and Trademark Office database at www.uspto.gov before registering the domain name.