“Did any of you gentlemen want to talk to ME about this?” Long John Silver, Treasure Island
Pirates. They are the worst. The first reaction to many domain name hijackers is that they deserve quick and decisive action, and the Uniform Domain Name Dispute Resolution Policy (UDRP) can provide a reasonable path to accomplish this. The policy allows trademark owners to take possession of wrongfully registered domain names after a quick and relatively cost-effective dispute process, wresting them from the pirate.
A winning claim under the UDRP requires prevailing in a three-pronged test:
- the incriminated domain is identical or similar to the plaintiff’s mark;
- this holder has no right or legitimate interest in the domain name; and
- the domain name has been registered and is being used in bad faith. The dispute is usually settled within a few months without any discovery or hearing. In short, it’s a fast and powerful alternative to litigation.
That being said, politics should not always be used. Below are five scenarios in which the UDRP is often considered, but is unlikely to result in a successful outcome.
Lack of priority
A threshold question in every domain name dispute is: who was first? In other words, do a plaintiff’s trademark rights predate the domain name registration date? Domain name speculation is not illegal and does not violate the UDRP.
So if a third party registers a domain name before a company has established trademark rights, a UDRP complaint is very unlikely to succeed. The actionable claim arises when the domain name hijacker registers the domain name even after a trademark right has been established.
Many domain names, especially highly searched domain names or those with common names, are registered once and then transferred or sold multiple times. A UDRP claim may succeed if the domain name was purchased before the trademark rights were created if the current registrant purchased the domain name from a previous owner after the senior user’s trademark rights were created. However, it is often difficult to determine exactly when this sale and transfer took place, and plaintiffs generally need a good faith basis to allege that their trademark rights arose prior to the purchase of the domain name by the holder.
Genuine trademark dispute
Often companies turn to the UDRP as a way to bypass litigation and secure a domain name. This often happens when a new business starts operations with a domain name, but the business and its domain name are the same or similar to a senior user’s brand.
However, if the new company is operating in good faith (even if technically an infringement), a UDRP complaint may fail because the second and/or third prongs of the UDRP test may not be satisfied.
An argument that the new business is operating in “good faith” is generally not a valid defense if the business is clearly trying to infringe the primary user. This creates close calls, but there is often a relatively clear difference between a company that uses the same mark or a similar mark for similar goods or services and a company that uses the exact same mark for the same goods in such a way that the confusion will obviously arise. In this case, UDRP panelists can often tell the difference between what is truly “good faith” use and what is merely a pretense attempt to tease a trademark owner.
Business relations gone wrong
The UDRP should not be used to recover domain names that exist as a result of terminated licenses or business relationships.The UDRP should not be used to recover domain names that exist as a result of terminated licenses or business relationships. A common scenario is that a licensee or business partner registers a domain name, and after the relationship ends, the licensee/business partner refuses to transfer the domain name back or cancel it. UDRP complaints in these types of situations often fail because the third prong of the UDRP requires the domain name to have been used and recorded in bad faith. These domain names, if used or maintained in bad faith, were often not originally registered dishonest.
The issue is more complicated if the licensee or business partner registered the domain name in violation of a contract or franchise agreement that prohibited them from doing so. Although there are fewer cases that address this issue, these cases suggest that it may be a viable claim under the UDRP because the original recording was barred by agreement.
Freedom of speech
Domain names used for the purpose of criticizing or commenting on a brand owner’s trademark or products and services are generally not subject to action under the UDRP. These types of activities are often considered a legitimate non-business purpose under the policy, sufficient to defeat a claim. Additionally, attempting to take a domain name from someone who uses it to criticize or comment can often create more bad publicity for the brand owner.
Common law trademarks
UDRP claims based on common law trademarks are not necessarily a red light, but companies relying on common law rights should carefully consider the merits of their case before proceeding.
If relying on a common law mark, a plaintiff must provide strong evidence that their mark is distinctive and has acquired such distinctiveness that consumers associate the mark with the owner’s goods and/or services. UDRP panels generally take this requirement seriously and will closely examine the type and volume of evidence submitted. Superficial or unconvincing evidence is often insufficient to establish sufficient trademark rights to prevail under the dispute resolution policy.
Therefore, while a UDRP claim is not impossible, in cases of disputes involving common law trademarks, trademark owners should be very careful.
UDRP can be a powerful weapon against Internet pirates, but it should be handled with care.
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