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Squatting not necessarily an abuse - brand owners beware!

29 April 2008

Brand owners have a number of possible ways of "recovering" from cyber-squatters, domain names that incorporate their trade marks. However, court proceedings, whether for trade mark infringement or passing off, can be expensive and time-consuming. Brand owners, therefore, often choose to employ the dispute resolution procedures provided by bodies such as Nominet (which administers the ".co.uk" domain).

The key to success under the Nominet procedure is the ability to show that the domain name in question was either registered with abusive intent or is being used in an abusive manner. In many cases, this has not proved at all difficult. The Nominet panels have readily found abuse where the cyber-squatter has registered a number of well known marks as domain names, has made no use of the domain name in question and/or has offered to sell the domain name to the relevant brand owner for a large sum of money.

However, the recent decision of a Nominet Appeals Panel in a case where the UKs leading debit card brand owner, Maestro International Inc was seeking to recover from a Mr Adams the domain name "maestro.co.uk" shows that brand owners cannot necessarily count on success in these circumstances.

In this particular case, all of the factors referred to above were present to a greater or lesser extent. Moreover, the Appeals Panel fully shared the scepticism of Maestro International about Mr Adams contentions that he was unaware of the "Maestro" mark when he registered his domain name and intended to use the domain for "musical downloads, educational and tuition services". Nevertheless, both the original Panel and the Appeals Panel declined to find that there had been any abuse and Mr Adams, accordingly, kept his domain name.

At first sight, this is a worrying decision from the brand owners point of view. What needs to be borne in mind though is that, unlike in many of these cases, the debit card company was seeking to protect a mark with a common dictionary meaning and one which, if used in one of the fields allegedly intended by Mr Adams, would probably not infringe the card companys trade mark rights.

In other words, it was easy to think of perfectly legitimate uses of the domain name, even if the Appeals Panel was sceptical about whether such uses were originally within Mr Adams contemplation. The situation was, therefore, different from ones where an individual sought to register domain names incorporating marks such as "forrest gump", "big brother" or "beverly hills cop"… as Mr Adams had previously done!

In conclusion, the Nominet and similar procedures will continue to provide trade mark owners with the remedy that they require in many cyber-squatting situations. The Maestro decision is however, a warning to trade mark owners to consider carefully the extent to which the circumstances do actually prove abuse before they initiate a complaint. It is also a reminder to the owners of marks with ordinary dictionary meanings (such as "maestro") that it is probably more important for them than for other brand owners to register their mark in all of the key top level domains.

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The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

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