Cybercrime

This article has been written by Shivani Singh pursuing the Diploma in Cyber Law, FinTech Regulations, and Technology Contracts from LawSikho. The article has been edited by Prashant Baviskar (Associate, LawSikho) and Ruchika Mohapatra (Associate, LawSikho).

Introduction

In the modern world, every business or organization, whether big or small, prefers to have its presence on the Internet. With the growth of technology, it has become easier for a business or an organization to market its products and services over the internet as it has a rampant reach to the masses. This is usually done by launching websites in the name of the company or business after registering the name of the website, which is known as the domain name. A domain name generally consists of the trademark of an organization or business and can serve as a classing trademark function of symbolizing a company’s recognition and goodwill in the marketplace.

What is a domain name? 

A domain name in a technical sense is an alpha-numeric mnemonic device that can be mapped onto an Internet Protocol (IP) address which enables the users to browse the web more easily than if they had to remember the details of each IP address they wanted to visit. Since the Internet Protocol numbers are all-numeric, they are difficult to remember and are not eye-catching, which led to the emergence of a domain name system (DNS), which is a popular substitute for all the IP addresses of a particular server, for example, “apple.com”, “amazon.com” etc. These domain names can be registered in any name of the choice of the owner. The domain name in today’s world serves as an online trademark, source identifier, indicates quality, and repository of goodwill. Since customers cannot sample a product physically on the Internet, considerable reliance is placed on the prior reputation and goodwill of the person advertising the product on the Internet. Thus, it can be said that domain names reflect the trademark of an organization and are pivotal corporate assets.

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What is cybersquatting? 

With the rapid increase in the usage of the Internet, the importance of domain names has escalated by almost 46.4% since 1995 throughout the world. Big corporations and businesses prefer to register domain names in the name in which they carry out the business outside their country. However, there is a proclivity in the domain names field to register the names of these big corporations and well-known businesses as domain names by persons other than the owners of such commercial undertakings.  Registering domain name in the name of a well-known and/or registered trademark or confusingly similar trademark, and then trying to sell that domain name to the owner of the well-known and or/registered trademark or to a third party with an intention of selling it at a higher profitable price to the trademark owner is known as cyber-squatting. The High Court of Delhi in the case of Manish Vij v. Indra Chugh has defined cyber-squatting as “an act of obtaining fraudulent registration with an intent to sell the domain name to the lawful owner of the name at a premium.”

What are domain name disputes? 

The value and potency that a domain name possesses have ensured that organizations are willing to shed any amount of time and money so as to acquire these names. Unlike the traditional trademark system, where identical trademarks may be owned by several persons, subject to certain differentiations such as geographical or class of goods or product, the virtual world has a limitation that only one owner can possess a particular domain name. Domain name disputes generally arise in two situations; in the first, an individual or organization with no other rights to a name may register a website with that name. This may be for several objectives- extortion, appropriation of goodwill, diversion of web traffic, defamation, dilution, etc. The second kind of situation is where conflict arises between persons who are equally entitled to a name- a situation that often arises given the global nature of the internet.

Legal analysis

In India, there is no specific legislation that deals with cyber-squatting or other domain name disputes. However, in the protection of trademarks in domain names, the Trade Marks Act, 1999 is used. The limitation of the Trade Marks Act, 1999 is that it is not extra-territorial and therefore it does not provide for adequate protection of domain names. The Indian Courts, in spite of the absence of such legislation, however, have been very active in providing relief in the case of cyber-squatting. 

The first case of cybersquatting in India was Yahoo Inc. v. Akash Arora. In this case, the U.S.-based Yahoo Inc. had filed a suit for injunction against the defendant Akash Arora, who had registered a deceptively similar trademark of Yahoo Inc. as “Yahoo.com”. The High Court of Delhi passed an injunction order in favor of the plaintiff restraining the defendant from using “Yahoo!” as it infringed the trademark of Yahoo Inc. As the defendant’s domain name was deceptively similar, it was easy for the consumers to be confused despite the disclaimer put by the defendant or adding the word “India ” in its domain name.

Another landmark case in the development of Indian Jurisprudence on a domain name is the Rediff case. In Rediff Communication Ltd. v. Cyberbooth and Another, the High Court of Bombay stated that “A domain name is more than an internet address and is entitled to equal protection as a trademark.” In this case, the plaintiff filed for an injunction against the defendant who had registered the domain name in the likeness of the domain name of the plaintiff, claiming that such domain name was deceptively similar to theirs. There was a common field of activity. The judge was satisfied that there was a clear intention to deceive and that the only purpose of registration by the defendants was to trade on the goodwill and reputation of the plaintiffs. The judgment given in Satyam Infoway Ltd v. Sifynet Solutions (P) Ltd. is said to have nailed the Indian domain name scenario way back in 2004. The Supreme Court, in this case, stated that: “As far as India is concerned, there is no legislation which explicitly refers to dispute resolution in connection with domain names. But although the operation of the Trade Marks Act, 1999 itself is not extraterritorial and may not allow for adequate protection of domain names, this does not mean that domain names are not protected in India”. The decision, in this case, was again in favor of the plaintiff, wherein the respondent had registered domain names and which were similar to the Plaintiff’s domain name. The Court remarked that domain names had all the characteristics of a trademark and an action of passing off can be found where domain names are involved.

The common law approach to cyber-squatting 

In Marks & Spencer v. One-in-a-Million, the defendant had registered domain names of several companies to his name. The Court was of the opinion that the defendant’s activities showed a deliberate practice of registering domain names that resemble the name of well-known trademarks and there was also intended to deceive the public by choosing such domain name. The High Court granted an injunction in all five cases and stated that injunction is granted by the courts when the name is adopted with the intent to cause passing off, with the intent to use under fraudulent circumstances. In the case of Prince Plc v. Prince Sportswear Group Inc., both the parties had legitimate interest in using the domain name in issue. The plaintiff, a computer services firm based in the U.K. had registered the domain name “prince.com”. When the defendant tried to register the same domain name, they found that it was registered by the plaintiff. The defendant sent a letter to the plaintiff, through their attorneys asking the plaintiff to assign the domain name to the plaintiff and that the use and registration of PRINCE as a domain name by the plaintiff constituted infringement and dilution of the defendant’s rights in the trademark. An inquiry as to damages was refused to be granted by the judge in the absence of evidence of damage. Secondly, the lordship refused the declaration that the plaintiff’s registration and use of its domain name does not infringe the defendant’s UK trademark. The burden of proof was on the plaintiff for a declaration of non-infringement. But an injunction was issued against the defendants, preventing them from continuing with the threats of infringement proceedings against the plaintiff.

Conclusion

Cybersquatting has become so prominent in the current world scenario that it has been termed as a modern-day extortion technique, making it viewed as an important issue in the legal setup. The U.S. had enacted the Anti-Cybersquatting Consumer Protection Act way back in 1999 to try and resolve disputes in this regard, however, in India, there is no such legislation in specific which deals with cyber-squatting. All the cases in India with regard to cyber-squatting are resolved on the trademark law which is bound to be counterproductive.

The emphasis should not be on examining every dispute from a trademark angle because not every time the process of litigation would be preferable as it leads to an enormous loss of time and money. Therefore, there is a dire need for new legislation in India that would specifically deal with cyber-squatting. Although the courts have taken recourse to the trademark law in resolving these domain name disputes, there is no specific law in the Information Technology Act or legislation dealing with cyber-squatting. In many cases, the courts have to seek guidance from English and American laws and decisions. It is, therefore, the need of the day to have a law such as ACPA as in the case of the U.S. There has been an increase of about 4.6% in the number of cases (2754) filed in the WIPO Arbitration and Mediation Center in 2015 compared to that of the previous year. In light of this, another suggestion could be the establishment of a national arbitration forum which deals with domain name disputes in India, forming a parallel body to the US National Arbitration Forum and the Czech Arbitration court. Such institutions shall aid in faster and effective disposal of cases unlike in the path of Indian courts.

Further, decisions of the WIPO Arbitration and Mediation Center and ICANN with respect to domain name disputes should be made binding on Indian Courts which would help ease the already overburdened Indian Court system. Lastly, these disputes could be reduced to a great extent if the registrar, before allocating the domain name, does some background check, thereby curbing the possibility of a dispute that could arise in the future. Another way out can be publishing the to-be-allotted domain names in a journal, as it is done in the case of trademarks in the trademark journal. Such approaches to cyber-squatting would go a long way in reducing and preventing the number of domain name disputes.

References

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