Managing domain names: a view from ITMA

Many companies have been slow to identify and react to the challenges of domain name management, says Maggie Ramage of the Institute of Trademark Attorneys, but simple steps can be taken to avoid the most serious threats to trademarks.

Domain names allow computers to distinguish between millions of web pages on the Internet, enabling users to send and receive messages by email, access web pages and establish an online identity. A domain name is an Internet address in the same way that a telephone number uniquely identifies a telephone line connected to the global telephone network. No two organisations can have the same domain name in the same way that no two people can have the same telephone number.

Internet users expect a domain name consisting of a trademark in commercial use to be associated with the owner of the trademark and not with a third party. This has led to widespread litigation and recovery proceedings, because as domain names are sold on a ‘first come, first served’ basis, it is quite often the case that someone who does not have the legal right to own that domain acquires it anyway, often in the hope that they can sell it back to the rightful owner of the trademark.

Trademark registrations normally take precedence over domain registrations, so if a company owns a particular trademark, it makes a good starting point for recovering a similar domain name.

Domain name registration and maintenance is an area of law that has grown very quickly—perhaps too quickly for owners of domain name registrations to really think through domain name management. All too often, companies have little or no cohesive strategy for domain name ownership, management or renewal.

The Institute of Trade Mark Attorneys in the UK (ITMA) holds 25 domain name registrations. Recently, we looked at the portfolio and realised that its maintenance was perhaps not as costeffective as it might be. We also found that many of the domain names were actually pointing to the website of the company that provided the hosting service (and therefore advertising its services), rather than pointing to our website.

We carried out an overhaul of our general domain name management strategy, transferred the management of the domain names to another entity that will automatically renew them (this is a particularly important point) and carried out a general review of what we own. It is important that domain names are renewed automatically, because if a domain name is inadvertently allowed to lapse, it cannot be restored to record, unlike a trademark registration. For companies, a domain name management strategy is essential. A company should be aware of who is servicingits domain names.

It also needs to know how to maintain them for renewal, whether they are on automatic renewal, where they point to, and whether they are the correct domain names to use or if they need to be updated by being added to. Finally, it is vital to ensure that the ownership is correct. This is particularly important when a company transfers assets, perhaps through a merger or acquisition, because the ownership of the domain must be assigned to the correct owner. The ‘user’ is not necessarily the correct owner. Many licensees will argue that because they ‘use’ the domain name for their country, that they should own it. Generally speaking, there is nothing to prevent the trademark owner from owning (being the ‘registrant’ of) the domain name, which can then be pointed to whichever website is deemed best. This avoids expensive litigation if the licensee does not want to give up the domain name on termination of the licence. It is also worth considering implementing a domain name watch, for example, on a monthly basis. This can prove invaluable to understanding who else is out there and possibly active with the same or similar domain name elements to your company’s or clients’ domains. It also enables you to start speedy proceedings to recover domainnames that have been registered in contravention of your company’s or clients’ rights.

There are a number of questions to consider when developing a domain name management strategy:

• Why is the domain wanted?

• What is it actually used for?

• Does the domain name incorporate a trademark or a descriptive element, or both?

• Which domain names are owned by you or your client?

• Where are the domains managed?

• Where do the domain names point to? Many registrars, and some hosting companies, point domain names to their own or to other people’s advertising sites, if not instructed to point them to a specific site

• Where (and when) should the domain name registrations be effected? Is it necessary for a business to have local country code domain names (ccTLDs) as well as or instead of top level domain names (gTLDs) such as .com?

• Who is responsible within the company for obtaining domain name registrations and in whose name are those domains registered? It is all too common for the person charged with registration to give their own name as registrant

• Who is responsible for maintaining those domains and deciding which ones should or should not be renewed? Has any system of automatic renewal been considered or implemented? ITMA automatically renews all domain names for which we are responsible, unless specifically instructed to cancel them, as it is cheaper to refund a renewal fee inadvertently paid for than to try to recover a lost domain name.

• Who is actually responsible for working out what to do with those domains and the locations they should point to?

When trying to recover domain names, an action may be brought under the Uniform Domain- Name Dispute-Resolution Policy (UDRP) or dispute resolution services (DRS) procedures, depending on the registry. The UDRP procedure is used by ICANN and many other registries around the world, and generally speaking, when ICANN accredits a domain name registry, it is required to use the UDRP. Other registries, such as Nominet in the UK, may use their own dispute resolution services. There are key differences in these procedures, so it is important to know which registry administers a particular domain.

It is also imperative to be aware of jurisdictions or countries where domain name infringers are most active. There is increased activity in domain name registration in China and in Russia, for example.It is important to recognise occasions when there is no option but to buy a domain name if there is no justifiable complaint that can be brought against the registrant. This may necessitate an investigation into the use of the domain and negotiation over the purchase price.

It is a good idea not to divulge your identity when negotiating a price for a domain, as often, the more high-profile the potential purchaser of a domain, the bigger the consideration requested by the registrant.

There are other occasions where it is possible to bring a valid complaint on the grounds of bad faith. For example, if a licence to use a domain is terminated, and the ex-licensee subsequently registers the same or a similar domain to the one it was previously allowed to use, this is a clear demonstration of bad faith

It is imperative to check ownership of domains and to ensure that they are not registered in the name of an employee of a company, as that employee could leave. Another problem arises when the employee concerned lists himself as the administrative contact.

If that employee leaves, emails from the registry will not be received, with the risk that the domain may not be renewed. It is also essential to ensure that if there is a licence concerning the use of the IP, it includes a clause to ensure that domain names cannot be registered by the licensee, but must always be registered to the licensor. All licences should be reviewed and, if necessary, reworded to include domain names. If domain names are licensed for use by third parties, it is important to watch out for any similar domain names subsequently being registered by an ex-licensee, which could include the trademarks of the previous licensor. Again, this is a common problem and another reason why a domain name watch is useful.

Best practice is never to allow a licensee to actually own a domain name, even in a local geographical territory. The owner of the domain name can point it wherever it wishes (including to any website of the licensee) and, therefore, when the licence is terminated, there is no issue concerning recovery of the domain.

Even if there are local regulations concerning local domicile issues, it is possible to use an intermediary as a local contact to hold a domain name on behalf of a company.

Internationalized Domain Names (IDNs) may change the picture somewhat. From December 10, 2009, EURID, the operator of the .eu domain rights, launched .eu domain names in the 23 scripts of the EU (although some local charactersare not allowed). However, applicants must have a local presence within the EU to apply for these.

Watch for the possibility of filing non-Latin characters such as Cyrillic or Katakana characters. ICANN launched a fast-track procedure in November 2009 to allow nations and territories to apply for Internet extensions reflecting their name but comprising national language characters.

Another topical method of registration being widely discussed at present is the possibility of filing a domain name with the extension .co. Although this is currently the country code for Columbia, it is widely tipped that .co will be promoted as an alternative to .com. There will be a ‘sunrise period’, allowing trademark owners to register domain names prior to opening up .co domains for general registration. In order to reserve a .co domain name, during the sunrise period, a trademark owner will be able to use a trademark they own in any country as the grounds or basis for obtaining that domain.

It is definitely worth keeping a close eye on developments in the domain name world, which is very fast-moving compared to trademark registrations and is becoming increasingly important with the expanding use of the Internet as the main method of trading commercially.

Maggie Ramage is a trademark lawyer at Alexander Ramage Associates. She can be contacted at: maggie@ramage.co.uk