Updated as at 15/4/2003.
1. What is a trade mark?
Any sign used, or intended to be used, to distinguish goods or services of one trader from those of another. (1) A sign includes any letter, word, name, signature, numeral, device, brand, heading, label, ticket, aspect of packaging, shape, colour, sound or scent.(2)
2. How to protect trade marks in Australia?
Trade marks in Australia can be protected: (3)
* by registration with IP Australia (http://www.ipaustralia.gov.au) under the Trade Marks Act 1995 (Cth);
* at common law by an action known as the tort of passing off; or
* by the misleading and deceptive conduct provisions of the trade practices legislation.
See Misleading and Deceptive Conduct Fact Sheet for more information.
3. Trade marks must be in use
Unlike many other forms of property, a trade mark must be in use as a trade mark for the registered holder to maintain its trade mark rights. (4) The use as a trademark must indicate a connection in the course of trade between the trade mark and the goods or services of the trade mark holder. (5)
4. Benefits of registering a trade mark
There are two main benefits:
*Obtain a presumption of distinctiveness of the trade mark. (6)
*The registered holder does not have to prove it has built up a reputation in the mark by use in the market place (as would need to be done in an action for passing off).
The Register of Trade Marks maintained by IP Australia is split into various classes of goods and services. (7) Registration applies only to the goods and services described in the trade mark application. This means that the monopoly rights attaching to trade marks which are not "well-known" extend only to those goods or services or closely related goods or services. In other words, a mark held by one trader, say in relation to furniture, would not prevent a beauty salon from registering a similar mark in relation to the provision of beauty care services. (8) The policy basis is that there is no likelihood of confusion.
In the case of well known trade marks, monopoly rights can extend to unrelated goods or services where there is a likelihood that consumers would assume a connection betwen the two products, to the detriment of the trade mark owner.(9)
A registered trade mark is initially protected for 10 years and renewable for further periods of 10 years.(10)
5. What rights does a trade mark owner have?
The exclusive right to apply the trade mark to particular goods and services, and to sell and licence its trade mark rights.(11)
6. Infringement of a trade mark
Occurs where a person uses a trade mark or a sign (which may include a domain name) that is substantially identical with or deceptively similar to a registered trade mark in use by another in relation to certain goods or services. (12)
Infringement of a trade mark requires "use as a trade mark". If the domain name is merely registered but there is no use in the course of trade, infringement is unlikely. (13)
7. Passing off and misleading conduct
The tort of passing off is a common law action used to prevent trader A from misusing trader B's goodwill or reputation by misrepresenting that A's goods or services are those of or related to B.
Most passing off actions are brought in conjunction with an action for breach of the misleading and deceptive conduct provision of the trade practices legislation. The two actions are similar, although under the trade practices provision it is not necessary to prove customers have actually been misled. (14)
8. Trade marks and domain names
A domain name is an alphanumeric name that is easier for users to remember than a long series of numbers that actually make up an internet address.
The functional role of domain names as user friendly Internet addresses, meant that they were initially allocated on a "first come, first served basis". However, the commercialisation of the Internet has brought domain names into conflict with traditional business identifiers such as trade marks. This tension is heightened by the need for each domain name to be unique at a global level. This is in contrast to trade mark rights, which are structured along product and territorial lines. These factors have encouraged "cybersquatters" to register as domain names, trade marks to which they had no legitimate connection. The intention is often to transfer the domain name to the trade mark owner for a profit. (DNS conflicts may also arise between parties with legitimate claims - eg two trade mark owners who use the same mark in relation to different goods or services.)
9. Domain name registration
To be eligible for registration in the ".com.au" space, a domain name must be directly derived from:
* the commercial name of an entity which is registered or licensed to trade in Australia; or
* a trade mark which has been registered or is the subject of an application for registration by the entity. (15)
Once a domain name is registered, the use of the name is granted to the registrant under a non-transferrable licence.
Holders of .com.au and .com domain names are generally required, as a term of the licence, to warrant that registration of the domain name and its use will not directly or indirectly infringe the legal rights of a third party (including copyright and trade mark rights). A breach of the warranty would allow the relevant licensing authority to terminate the domain name licence.
Trade marks can now also be protected during the launch of new top level domain names. In 2001, the launch of new gTLDs, .biz and .info, gave trade mark holders an opportunity to assert their rights before registrations were open to the general public. By making an intellectual property claim, the domain name was effectively tagged in an attempt to warn off cybersquatters. If applicants of the domain name wished to proceed with the application in the knowledge of these trade mark rights, the trade mark holder was notified and had the option to proceed to dispute resolution, go to court or do nothing.
(The criteria for registration of a .com.au domain name was liberalized by the new rules implemented by auDA introduced in mid-2002. For more details see the Domain Names Fact Sheet )
10. When will a domain name come into conflict with a trade mark?
The answer depends on the nature of the use of the domain name and the nature of the registration of the trade mark (or use in the case of an unregistered mark).
A domain name identical with or deceptively similar to a trade mark (that is not well known) will not come into conflict with the trade mark owner's legal rights if the domain name relates to entirely different goods or services. The reverse result may arise if the trade mark is well known. (16)
11. When will a domain name constitute passing off and / or misleading and deceptive conduct?
The mere registration of a trade mark as a domain name may involve a representation that the registrant is connected with the owner of the goodwill in the mark and thus constitute an instrument of fraud. This was the finding of the UK Court of Appeals in One in a Million case, which concerned the registration of various domain names incorporating famous marks by domain name dealers. (17)
Given that Australia’s law of passing off is based on UK law, the case is likely to be persuasive in Australia. In fact, the case was recently applied by the Supreme Court of Queensland in The Architects (Australia) Pty Ltd t/as Architects Australia v Witty Consultants & Witty. (18) This latter case is the only decision of an Australian court to result from a contested trial concerning the issue of whether or not the registration and/or use of a domain name constitutes passing off.
The facts of the case are as follows:
* The plaintiff, an architect, traded under the name "Architects Australia".
* The defendant operated the web site "architectsaustralia.com.au", which provided a directory services for architects. The defendant established the web site before becoming aware of the plaintiff’s business.
* After becoming aware of the plaintiff’s business, the defendant placed a disclaimer on its web site stating "This web site is in no way connected with the Architects (Aust) Pty Ltd".
The plaintiff alleged that the defendant’s use and promotion of the domain name transgressed on the goodwill attaching to the plaintiff’s business name, resulting in confusion and the diversion of business.
The Court found that the domain name "architectsaustralia.com.au" was an instrument of fraud and ordered its deregistration. More specifically, the Court found that:
* There was a sufficient connection between the two businesses for confusion to arise and for business to be diverted.
* The disclaimer on the web site was ineffective because it only referred to the plaintiff’s company name and not to its trading name. In addition the disclaimer only appeared on the website, whereas the defendant had referred to the domain name in its general advertising campaign.
* The fact that the defendant was unaware of the plaintiff’s business when it registered the domain name, did not preclude a finding of equitable fraud.
Other possible categories of misleading conduct in relation to domain names include: (19)
* falsely suggesting a connection between the site and a known business or particular goods or services (eg ninenews.com);
* falsely suggesting particular qualities or attributes (eg free.shareware.com);
* buying the domain name of a rival company and redirecting traffic from that site to the former site; or
* exploiting deliberate reading or typing mistakes (eg westcap.bank.com) or abbreviations.
12. Administrative Dispute Resolution Policies
Trade mark owners seeking to obtain a domain name from a cybersquatter may also take advantage of the streamlined administrative dispute resolution procedures which are available at both the gTLD (Uniform Dispute Resolution Policy) and .au (auDA Dispute Resolution Policy) domain name level. Remedies under both procedures are limited to the status of the infringing domain name (ie deregistration or transferral). However, in cases where the cybersquatter has passively held the domain name, the trade mark owner would be unlikely to recover significant damages under traditional legal remedies in any case. This is because of the difficulty in establishing profits made by the cybersquatter or loss in sales revenue incurred by the trade mark owner. Importantly, pursuing either of these procedures does not prevent subsequent legal action by the trade mark owner. The two policies are summarised in the Domain Names Fact Sheet .
13. Reverse Domain Name Hijacking
"Reverse domain name hijacking" refers to the bad faith use of any intellectual property rights principles or of the above dispute resolution policies to attempt to deprive a registered domain-name holder of a domain name.(20)
An example of this tactic has been the initiation of litigation by Nissan (Motors) against Uzi Nissan – the registered holder of www.nissan.com. Mr Uzi Nissan, an Israeli-American uses the domain name www.nissan.com for his legitimate computer company and has never traded in domain names. Nissan (Motors) is attemping to 'lever off' Uzi Nissan by filing a suit for trade mark dilution and domain name piracy. Uzi Nissan's litigation costs are estimated to be up to $1million (US). Mr Nissan alleges that the lawsuit is an attempt to pressure him to transfer his domain name. (21)
12. Other instances of misleading and deceptive conduct and passing off
The use on websites of internal and external links, frames, metatags, the location and prominence of disclaimers and content generally, must not be misleading or deceptive to the extent goods or services of A are passed off as those of B. (22) The prohibition applies to unintentional misleading or deceptive conduct, whether through silence or gratuitous expression of opinion, and cannot be contracted out of.
The tort of passing off is a common law action used to prevent trader A from misusing trader B’s goodwill or reputation by misrepresenting that A’s goods or services are those of or related to B.
Most passing off actions are brought in conjunction with an action for breach of the misleading and deceptive conduct provision of the trade practices legislation. Under the trade practices provision, it is not necessary to prove customers have actually been misled. (23)
14. Cyberstuffing as misleading conduct and passing off?
Cyberstuffing is the practice of embedding metatags in a website. (24) Metatags are HTML code placed around specific pieces of information which are picked up by search engines to provide keyword information about the contents of a particular website and rank the site in order of relevance. Generally metatags are invisible to the eye. By "stuffing" a website with metatags, the website will have a high relevance to most search queries.
A car company may stuff its website with metatags containing the brand names of other car companies so that its website always answers to search queries involving those other car brands.
The use of trade marks as metatags is likely to constitute a trade mark infringement and may constitute misleading or deceptive conduct and passing off. (25)
16. Is deep hyperlinking and framing misleading conduct or passing off?
Deep hyperlinking means linking directly to the content of another website. This involves bypassing the home page containing advertising and information about the site owner and sometimes also the terms and conditions of use of the site. (26)
A frame is a window inside a web browser. A webpage can be divided into several frames, each displaying different content. A user may navigate from page to page or site to site in one frame while the content of another frame (eg an index) remains the same.
Where a disclaimer or acknowledgment is appropriately located in website A which leaves a visitor with no doubt about the relationship between site A and the framed or linked sites within it, framing and deep linking may not constitute misleading and deceptive conduct or be the subject of a successful passing off action. For example, an acknowledgment of the source of the linked content and a link to the homepage of the source could be placed next to the deep hyperlink to minimise liability.
See Screen Scraping for potential misleading and deceptive conduct issues concerning the aggregation of content from many sites into one site. (27)
See Copyright fact sheet for potential copyright issues in relation to framing and deep hyperlinking.
17. Other relevant provisions of the trade practices legislation
Information considered misleading or deceptive conduct (28) may also be subject to liability under the following provisions:
*making false or misleading representations about attributes of goods or services or about the corporation’s relationship with others;(29)
* making false representations or engaging in other misleading conduct in relation to the sale of land;(30)
* engaging in misleading conduct about the nature or terms of employment;(31)
* offering gifts, prizes and free items without the intention of supplying them; (32)
* engaging in misleading conduct about the nature, characteristics, suitability or quantity of any services; (33)
* offering goods or services for a price if the corporation reasonably believes it will not be able to provide or deliver those goods or services; (34)
* making false or misleading representations about the profit or risk of business that the corporation has represented can be carried on at home; (35) and
* asserting the right for payment for unsolicited goods or services, or for making an entry in a directory.(36)
Other relevant Fact Sheets:
Copyright
Domain Names
Misleading and Deceptive Conduct
Sources of Law
Trade Practices Act 1974 (Cth)
Trade Marks Act 1995 (Cth)
End Notes
1. s 17 Trade Marks Act 1995 (Cth)
2. s 6 Trade Marks Act 1995 (Cth)
3. See generally P Hourigan ‘Domain Names and Trademarks: an Australian Perspective’ in Going Digital 2000: Legal Issues for E-commerce, Software and the Internet (2000)
4. s 92 Trade Marks Act 1995 (Cth)
5. ss 7(4),(5)Trade Marks Act 1995 (Cth)
6. s 20 Trade Marks Act 1995 (Cth)
7. r 3.1, Sch 1 Trade Mark Regulations 1995(Cth)
8. s 120(2) Trade Marks Act 1995 (Cth)
9. s 120(3)Trade Marks Act 1995 (Cth)
10. s 72(3) Trade Marks Act 1995 (Cth)
11. s 20 Trade Marks Act 1995 (Cth)
12. s 120 Trade Marks Act 1995 (Cth)
13. s 17 Trade Marks Act 1995 (Cth)
Pepsico Australia Pty Ltd v Kettle Chip Co Pty Ltd (1996) 33 IPR 161
See generally P Hourigan p 148
14. Applied Business Technology Pty Ltd v Grandmaster Computers [1999]FCA 36
15. See Domain Name Fact Sheet
16. s 130 Trade Marks Act 1995 (Cth). See generally Domain Names Fact Sheet
17. British Telecommunications PLC and Others v One in a Million Ltd and Other (1997) 42 IPR 289.
18. The Architects (Australia) Pty Ltd trading as Architects Australia v Witty Consultants Pty Ltd and Michael Witty [2002]QSC 139.
19. Ibid
20. Rule 1 (Definitions), auDRP Rules, http://www.auda.org.au/docs/auda-audrp-final.html; Rule 1 (Definitions) UDRP Rules http://www.icann.org/udrp/udrp-rules-29sept99.htm#1rdnh.
21. Uzi Nissan's side of the story.
Examples of Reverse Domain Name Hijacking cases: qtrade ; k2r.com ; smartdesign.com; safaricasino.com
22. See generally B Finch ‘Consumer Protection on the Internet’ in Going Digital 2000: Legal Issues for E-commerce, Software and the Internet (2000), p.270; see also Misleading and Deceptive Conduct Fact Sheet
23. Finch at p.270; Applied Business Technology Pty Ltd v Grandmaster Computers [1999] FCA 36.
24. Finch at p.270. 25. Playboy Enterprises Inc v Calvin Designer Label (No 97-3204 Cal ND Cal 1997)
26. Shetland Times Ltd v Wills (1996) 37 IPR 71;
27. See generally EBAY Inc v Bidders Edge Inc ; Register.com v Verio Inc
28. Under the s 52 Trade Practices Act 1974 (Cth) and State and Territory equivalents
29. s 53 Trade Practices Act 1974 (Cth) . See Trumpet Software Pty Ltd v Ozemail Pty Ltd (1996) 34 IPR 481; Applied Business Technology Pty Ltd v Grandmaster Computers [1990] FCA 36
30. s 53A Trade Practices Act 1974 (Cth)
31. s 53B Trade Practices Act 1974 (Cth)
32. s 54 Trade Practices Act 1974 (Cth)
33. s 55A Trade Practices Act 1974 (Cth) . See ACCC v Internic (1998) ATPR 41-646
34. s 56 Trade Pract