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Bradfield, Owen --- "Domain Names in Australia - Legal and Contractual Dispute Resolution" [2001] JlLawInfoSci 15; (2001) 12(2) Journal of Law, Information and Science 231

Domain Names in Australia – Legal and Contractual Dispute Resolution

OWEN BRADFIELD[*]

Abstract

With the increasing use of the Internet in both public and private life, there is increasing competition for domain names. This has led to disputes concerning the rights of parties to particular domain names, and discussion as to the precise relationship between domain names and trademarks. Recently, .au Domain Administration (auDA) assumed the rights to administer Australian domain names and, in August 2002, established an Australian dispute resolution policy (auDRP) for domain name registration. This represented an extension of the American-based Uniform dispute resolution policy (UDRP) that had been in force in Australia for some time. However, the impact of these changes to dispute resolution in Australia remains to be realised, particularly since there has been little judicial comment on domain names in Australia.

Introduction – domain names and disputes

Domain names are ‘user-friendly’ computer addresses that allow others to know where a person or entity is located on the Internet. With the seemingly exponential increase in popularity and commercialisation of the Internet, competition to register prominent, conspicuous, relevant ‘aesthetically pleasing and mnemonically stimulating’[1] domain names has increased. This has provoked reform of the allocation of Internet domain names. Previously, this process was relatively informal, and depended largely on a voluntary basis. In June 1998, the United States Department of Commerce proposed that a private, non-profit corporation oversee this role internationally, and the Internet Corporation for Assigned Names and Numbers (ICANN) was consequently established under Californian law[2] to manage the global domain name system. On October 24 1999, ICANN approved a contractual model for the resolution of domain name disputes, known as the Uniform Domain Name Dispute Resolution Policy (UDRP). To date, this is the paramount international legal framework for the regulation of Internet domain names.[3] Before obtaining registration of .com, .net and .org gTLDs, applicants must agree to be bound by the UDRP. It is intended to act as a rapid and inexpensive forum for resolving ‘obvious’ and simple, rather than complex, complaints.[4] Complainants must show that a domain name is identical or confusingly similar to a trademark or service mark, that the owner of the domain name has no legitimate interest in the domain name and that the domain name is being used in bad faith. In the first two years, there were in excess of 4500 disputes under the policy.[5]

In 1999, the Australian government established .au Domain Administration Limited (auDA), a non-profit organization, to regulate the registration of the Internet domain names. Subsequently, in September 2001, auDA entered into a sponsorship agreement with ICANN that gives auDA the right to administer the .au ccTLD.[6] The constitution of auDA takes the view that the Internet Domain Name System is a public asset, and that since the .au ccTLD is under the sovereign control of the Commonwealth of Australia, auDA will administer the .au ccTLD for the benefit of the Australian community, under the delegation of ICANN.[7] On 1st August 2002, a new Australian dispute resolution policy (auDRP) for Internet domain name allocation was established. The auDRP is one of many extensions to the UDRP instigated by various countries. The auDRP was formulated to take account of specific policy rules that might apply to .au domain name registration that do not apply to the gTLD domain names.[8] For instance, policy restrictions in Australia require applicants to obtain a domain name only if it is derived from a business name or entity. The auDRP is also intended to address practical constraints that have become apparent since arbitrations under the UDRP began in 1999,[9] and the fact that disputes between domain name registrants and third parties have been relatively less common in the .au domain. This paper will examine the major differences, in substance and form, between the UDRP and the auDRP and will explore adventitious avenues of legal protection afforded to holders of either domain names or trademarks in Australia.

Substantive differences between the UDRP and the auDRP

During the drafting process, there were several arguments in favour of auDA creating different rules to ICANN’s UDRP. Firstly, unlike ICANN, auDA is a regulatory body established by the Australian government, so it was felt that the rules should reflect the local differences in domain name registration and practices aforementioned. Secondly, the rules should reflect that the domain name industry is relatively more inchoate in Australia, compared to the global industry. On the other hand, some felt that significant differences between the auDRP and UDRP would frustrate continued international uniformity and certainty in domain name dispute resolution. However, since precedent does not bind panellists under the UDRP, sometimes confusing and contradictory domain name jurisprudence has resulted. The practical effect of the auDRP has been to clarify some issues, whilst simply codifying other practices that have apparently become customary.

Paragraph 4(a) of both the UDRP and the auDRP enunciate the elements that a complainant must establish in order to prove a breach of the policies. Paragraph 4(a)(i) of the auDRP provides that for a complaint to be lodged, the domain name must be identical or confusingly similar to a name, trademark or service mark, whereas under the UDRP, the provisions only included a trademark. The auDRP is therefore intended to include the situation where the domain name holder is using the name of a famous person in bad faith. The practical effect of the inclusion of personal names as the subject of domain name protection would be to dispel confusion. The WIPO report that led to ICANN adopting the UDRP, stated that registrations that violate personality rights would not fall within the definition of abusive registration for the purposes of the administrative procedure.[10] To support this, in Bruce Springsteen v Jeff Burgar and Bruce Springsteen Club,[11] it was found obiter dicta that the UDRP was not necessarily intended to protect proper names of this nature. Nevertheless, in other cases, panellists have held personal names to be akin to unregistered trademarks and were sufficient to confer standing.[12] [13]

Under paragraph 4(a)(iii) of the UDRP, domain name holders must both register and use a domain name in bad faith in order for the conduct to amount to abusive registration. This was the subject of considerable controversy when ICANN ignored the recommendations of the 1999 WIPO final report that the word and be replaced with or, since it is use rather than registration of a mark that is of most concern to trademark owners. However, the case of Telstra Corporation v Nuclear Marshmallows[14] interpreted this provision to mean ‘acting’ in bad faith. On the facts, the panellist found it difficult to believe that the respondent was unaware of the consequences for Telstra of registering the domain name. Thus, paragraph 4(a)(ii) of the auDRP reads that the domain name must have been registered or subsequently used in bad faith. This proscribes anomalous situations that could arise under the UDRP, where a domain name holder can ‘passively warehouse’ a domain name simply to prevent other companies from registering an interest in a domain name. However, the practical effect of the auDRP in this respect may be minimal as most UDRP panels have nevertheless interpreted the and to mean or.[15]

Paragraph 4(b) of the UDRP and the auDRP establish non-exclusive examples of conduct amounting to bad faith. Whereas paragraph 4(b)(i) of the UDRP makes it an offence to register a domain name for the purpose of transferring it to the complainant or a competitor of the complainant, the corresponding provision in the auDRP simply requires the intention to transfer the domain name to another person, provided the holder of the domain name offers the domain name for an amount greater than that domain name holder’s out-of-pocket expenses. However, the new auDRP provision may continue to be read in conjunction with previous UDRP panel decisions that an offer to sell a domain name some considerable time after the name was registered does not amount to registration in bad faith.[16]

Paragraph 4(b)(ii) of the auDRP no longer requires that the respondent have been engaged in a pattern of conduct of registering domain names for the purpose of selling, transferring or leasing them to third parties. It is sufficient to show that the respondent registered the domain name in order to prevent the complainant from registering the domain name. Penultimately, paragraph 4(b)(iii) clarifies that attempts to attract Internet users to any other sites also amounts to bad faith, not just to other websites owned by the domain name holder. Finally, paragraph 4(c)(i) clarifies that it is the use of the domain name that must be in bad faith, rather than the provision of goods and services, although the latter arguably amount to evidence of use in bad faith. Notwithstanding, a person offering a legitimate product over the Internet by attracting customers to a domain name identical to the trademark, service mark or name of another party, is still using the domain name in bad faith.[17]

It is also noteworthy that three of the four providers approved by ICANN for dispute resolution (World Intellectual Property Organisation (WIPO), CRP Institute for dispute resolution, eResolution and the National Arbitration Forum) are different to those used by auDA (Leading Edge Alternative Dispute Resolvers (LEADR), The Chartered Institute of Arbitrators - Australian Branch (CIArb), The Institute of Arbitrators and Mediators Australia (IAMA) and WIPO). Thus, the use of local dispute resolution providers in the determination of auDRP disputes is likely to influence the course of future decisions, since these providers contribute local experience and practice.

2.1 Characteristics of the UDRP and the new auDRP

In its relatively short existence, the UDRP has been both praised and vilified.[18] The UDRP has addressed conflicts between domain name registration rights and trademark rights that many people believe were poorly handled previously.[19] The UDRP fosters efficient and expeditious resolution of claims by trademark holders against an infringing domain name registrant, and provides relief from the procedural burdens and costs that can impede access to justice. However, this must be equilibrated with the limited remedies that a trademark holder has available in a UDRP proceeding, which include either cancellation of the registrant’s domain name or transfer of the domain name to the complainant. Registrars must comply with the decisions of panellists, because ICANN approves and oversees them. This makes UDRP decisions enforceable, but not binding, since either party can take the matter to court. Even after an adverse decision under the UDRP, a respondent or claimant could pursue litigation against the successful party.[20] Absent any superseding court decision, UDRP determinations are enforced by the eviction of the registrant from the domain name system. While the result is not technically binding, there is no way for the respondent to ‘opt out’ of the process, which some claim amounts to a fundamental violation of liberty under the façade of contractual agreement.[21] It is not possible to acquire a .com, .net or .org website, without ‘consenting’ to the UDRP. Although registrants who licensed their domain name before introduction of the auDRP will not be subject to the auDRP unless they choose to ‘sign on’ to the auDRP, they will nevertheless become bound by the auDRP upon renewing their domain name. Thus, it is regrettable that the apparent inattention to natural justice has been perpetuated in Australia.

The efficacy of the UDRP arises from its limited scope in addressing cases of only abusive registrations. Thus, a panellist decides abridged issues that focus on alleged bad faith, or lack of legitimate interests in a domain name. UDRP disputes are therefore cost-effective. As of March 2001, the filing fee for a dispute involving a single domain name, heard by a single panellist, was US$1,150.[22] This makes the UDRP an attractive alternative to prolonged legal action. However, it is has been pointed out that since complainants pay the fees, which go to the provider and then to the panellists who decide the case, there is a financial incentive for providers to decide cases in favour of complainants in order to encourage further complaints.[23] Additionally, protracted litigation is also likely to be complex litigation, which the UDRP is not adept to arbitrate. The administrative panels only consider written submissions and do not provide for discovery or interrogatories by the parties, elements that typically increase the financial and temporal cost of the proceedings. The UDRP enables parties to draft their own submissions by making forms conveniently available on-line. This effectively annuls the need to obtain legal representation and engage in costly and lengthy civil procedure. However, the disposal of the need for discovery can lead to an imbalance in the information of each party.

Under the UDRP, the panellists who decide cases are selected from one of four dispute resolution providers. Proponents of the UDRP argue that these highly experienced decision-makers have the skills necessary to make high quality determinations, being retired judges, lawyers or law professors.[24] The level of knowledge and experience of these panellists can influence trademark holders when choosing a UDRP proceeding over litigation. Indeed, it is a criticism of the UDRP that it favours complainants by allowing, ‘forum shopping’. Since the complainant has the choice of provider, they can examine the track record and rules of each provider and file their complaint with their preferred provider. For instance, WIPO panels have ruled for the complainant over 80% of the time, while eResolution and its arbitrators have found for the complainant less than 60% of the time.[25] Fundamentally, this causes one to question the impartiality of the decision-maker. To overcome this putative problem, it has been suggested that the registrars of the domain name be responsible for selecting a single dispute resolution provider. Unfortunately, this too remains problematic under the auDRP.

As previously mentioned, it has been argued that the decisions of the UDRP panellists are inconsistent. Different panellists have adopted different interpretations of the meaning of terms contained within the UDRP, which may also suggest an inadequate knowledge of intellectual property law, evidenced by differing opinion as to the meaning of ‘bad faith’. Moreover, the rights of complainants to resubmit an unsuccessful claim have yet to be developed, so there is no means of correcting potentially bad law.[26] In addition, no case summaries are provided and submissions are not legally prepared, so they often fail to address the issue in terms of the UDRP.[27] This complicates the matters for panellists who have a limited time in which to reach a decision. However, these difficulties are understandable given the lack of precedent with which panel members can work. It is likely that there will be increasing certainty about what should constitute a successful UDRP claim, as more cases are decided. Experienced panellists are already developing expertise with the UDRP ‘jurisdiction’, and their decisions have developed a seemingly novel common law.

Given the international nature of the Internet, oral evidence is often impossible, allowing instead for detailed written evidence. This makes it difficult for panellists to assess the credibility or veracity of claims or defences. For instance, respondents are sometimes setting up a mock business plan and prototype website so as to have legitimate interests in the domain name. Furthermore, respondents could register their domain names with different domain name registries in order to avoid detection of patterns of behaviour that amount to registration of multiple domain names. Unfortunately, both the UDRP and auDRP seem to discourage video-, telephone- or web-conferences,[28] techniques that could potentially overcome the limitations with purely written evidence.

At length, the UDRP imposes unilateral costs, covers limited claims, restricts the procedural rights of the parties, attenuates the issues considered, only reaches those who come voluntarily into the system, and limits enforcement to exile from the domain name system. Thus, it is frequently argued that decisions do not go far enough, since the UDRP does not protect domain names to which no trademark attaches, thereby furthering affluent and eminent interests. In this vein, it is clear that the auDRP has made some comparatively minor substantive adjustments to the rules, but very few major changes to their application and form, and therefore represents a largely insignificant addition to international domain name jurisprudence. However, both policies provide simple and flexible regulatory frameworks that reflect the global nature and rapid development of the Internet.[29]

Legal protection of domain names

Although Australia has no equivalent of the US Anti-Cybersquatting Consumer Protection Act, the auDRP does not prevent complainants from going to court, either for judicial review of auDRP decisions or for separate proceedings. There has been no judicial comment to date on the possibility of domain name registration or use in relation to trademark infringement,[30] but the nature of many cases heard under the UDRP, suggests that the Trade Marks Act (Cth) 1995 may be pertinent.[31]

3.1 Domain names as trademarks

Under s.17 of the Australian Trade Marks Act 1995 (Cth) (TMA), a trademark is defined as a sign used, or intended to be used, to distinguish goods or services dealt with or provided by a person in the course of trade, from goods or services so dealt with or provided by any other person. A sign is defined under s.6 as, inter alia, any letter, word, name, signature, numeral, brand or heading. Under s.20, the registered owner of a trademark has exclusive rights to use the mark. A trademark is infringed, per s.120, if a sign is identical, deceptively similar, or closely related, to a registered trademark, unless it does not cause confusion. As recognized by ICANN and auDA, domain names are increasingly used to identify businesses or personalities and are therefore increasingly assuming the role of trademarks.

Where two parties own identical trademarks for either similar or dissimilar goods or services, the domain name registration will be upheld on a first-in-time basis. However, under s.20 of the TMA, the domain name owner is only allowed to use the domain name in relation to their own trademark, and not the trademark of the other party. In the UK case of Prince PLC v Prince Sports Group PLC,[32] Prince PLC was a UK based IT company that registered the domain name ‘prince.com’ before Prince Sports Group PLC, which manufactured tennis racquets. The UK courts held that the sale of sportswear was in no way connected to information technology. Prince PLC was able keep its domain name because it was unlikely that customers would be confused. Upcroft[33] argues that this case would be likewise decided in Australia given the similarity between the UK Trade Marks Act 1994 and s.120 of the Australian TMA, which deal with infringement of a registered trademark where another is deceptively similar.

Cybersquatting is where someone registers a domain name in the name of a business with no connection to the business upon which the domain name is based. Although there is yet to be any Australian curial pronouncement in relation to cybersquatting, people using a site in connection with the unrelated goods and services of another trademark holder, may be infringing s.120(3) of the TMA – particularly where the trademark is well known and thus most likely to confuse. However, in the US case of Panavision International v Toeppen,[34] the defendant registered a domain name ‘panavision.com’ and subsequently offered to sell it to Panavision. This was held to infringe the value of the trademark of Panavision, even though there was no actual confusion over Toeppen’s use of the domain name. Likewise, typosquatting or domain mimicry is a variation of cybersquatting where domain names are registered with one letter or number altered, making them easily mistyped and therefore confusingly similar to a trademark. For instance, a domain name ‘micros0ft.com’ could be confusingly similar to the Microsoft Corporation.[35] In Australia, such a domain name could well be challenged under s.120(3) of the TMA since the domain name would be ‘substantially identical or deceptively similar to’ a trademark. Moreover, it may constitute an unauthorized use of a trademark under s.20, or a false representation under s.151.[36]

Therefore, it would appear, prima facie, that trademark owners have rights to protect their claims to legitimate use and registration of domain names in Australia.

3.2 Trade Practices Act 1974 (Cth) (TPA)

A domain name dispute could arise under s.52 of the TPA since a corporation cannot, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. This provision is commonly used to prevent another business from trading under a deceptively similar name. Clearly, it could also prevent a company from cybersquatting and using a domain name that is likely to mislead or deceive consumers. In Sydney Markets Ltd v Sydney Flower Market Pty Ltd,[37] it was held that the defendant’s registration of various domain names[38] that were similar to the plaintiff’s domain name <sydneyflowermarket.com.au>, was likely to mislead the public. However, the situation is unclear if the two businesses traded in unrelated goods or services, since actual or likely deception, required by s.52, would be absent.

Passing off – common law

Finally, the common law tort of passing off may also be available in Australia to protect holders of unregistered marks from abusive and deceptive domain name registration. However, this cause of action has been largely supplanted by s.52 of the TPA since the latter has the wider power to grant remedies in the absence of actual or potential damage.[39] In spite of this, there may be two situations in which passing off may be useful: firstly, in cases where individuals, rather than companies, abusively register a domain name; and secondly, where there is mere registration of a deceptively similar domain name. Fletcher Challenge Ltd v Fletcher Challenge Pty Ltd[40] held that mere registration of a company name is sufficient to constitute passing off where there is a misrepresented association with another entity, even if the defendant does not actually use the name. Registration of a domain name may therefore amount to equipment with an ‘instrument of fraud’.[41]

Conclusion

To date, the principal means of resolving disputes between domain name registrants and owners of trademarks has been through the UDRP. This contractual model has recently been extended to the Australian context by way of the auDRP, which seeks to encompass unique aspects of the Australian domain name industry. This thesis has examined some black letter and practical differences between the UDRP and auDRP and shows that whilst some minor uncertainties have been resolved, major procedural ambiguities remain. Furthermore, Australian courts have been palpably pauciloquent on the legal status of domain names under either the TMA or TPA. Therefore, substantial domain name law reform remains elusive, since many issues remain unresolved.


[*] Owen Bradfield is a final year Master of Laws and Bachelor of Medicine/Surgery student at Monash University in Melbourne, Australia.

[1] Upcroft A, ‘Trade marks as domain names: an Australian perspective’ [1999] MacarthurLawRw 5; (1999), 3 Mac LR 43.

[2] Lindsay D, ‘Internet domain name dispute resolution’ (2002), paper presented to BLEC congress 2002.

[3] Argy P & Breadsell L, ‘Domain name dispute resolution procedures overseas and in Australia’ (2002), 14(7) Australian Intellectual Property Law Bulletin 73.

[4] White Paper, 63 Fed. Reg. 31,741 (June 10, 1998),

http:// www.ntia.doc.gov/ntiahome/domainname/ 6_5_98dns.htm.

[5] Argy P & Breadsell L, ‘Domain name dispute resolution procedures overseas and in Australia’ (2002), 14(7) Australian Intellectual Property Law Bulletin 73.

[6] Ng C, ‘Australian domain names: the new rules (2002)’, GEN/CEN1061:1. <http://www.maddocks.com.au/download/australian-domain-names.pdf> .

[7] ibid.

[8] Wiseman A and Byrne A. ‘Dispute resolution for Australian domain names’. 6(5) Telemedia 59.

[9] ibid.

[10] WIPO, Final Report of the WIPO Internet Domain Name Process, 30 April 1999; cited in Lindsay D, ‘Internet domain name dispute resolution’ (2002), paper presented to BLEC congress 2002. http://wipo2.wipo.int/process1/report/index.html.

[11] WIPO Case No D2000-1532 (January 25, 2001).

[12] Jeanette Winterson v Mark Hogarth, WIPO Case No D2000-0235 (May 22, 2000).

[13] Julia Roberts v Russell Boyd WIPO Case No D2000-0210 (May 29, 2000).

[14] WIPO Case No D2000-0003 (February 18, 2000).

[15] Lindsay D, ‘Internet domain name dispute resolution’ (2002), paper presented to BLEC congress 2002.

[16] Software, Inc v Doom Gaming Connection NAF FA95002 (July 24, 2000).

[17] Thornburg EG, ‘Fast, cheap and out of control: lessons from the ICANN dispute resolution process’ (2002), 6 Journal of Small and Emerging Business Law 191.

[18] Anderson EC & Cole TS, ‘The UDRP – a model for dispute resolution in e-commerce’ (2002), 6 Journal of Small and Emerging Business Law 235.

[19] Anderson EC & Cole TS, ‘The UDRP – a model for dispute resolution in e-commerce’ (2002), 6 Journal of Small and Emerging Business Law 235, at 236.

[20] ‘ICANN, Approved Providers for Uniform Domain-Name Dispute-Resolution Policy,’ at http://www.icann.org/dndr/ approved-providers.htm.

[21] Thornburg EG, ‘Fast, cheap and out of control: lessons from the ICANN dispute resolution process’ (2002), 6 Journal of Small and Emerging Business Law 191.

[22] National Arbitration Forum, UDRP Schedule of Fees, at http:// www.arb-forum.com/domains/UDRP/fees.asp.

[23] Geist M, ‘WIPO Wipes Out Domain Name Rights’, Globe & Mail, Aug. 24, 2000, at http://www.globetechnology .com/archive.

[24] ICANN, ‘Approved Providers for Uniform Domain-Name Dispute-Resolution’ Policy, at http://www.icann.org/dndr/approved-providers. Htm.

[25] Geist M, ‘WIPO Wipes Out Domain Name Rights’, Globe & Mail, Aug. 24, 2000, at http://www.globetechnology .com/archive.

[26] See, e.g., Furrytails Ltd. v Andrew Mitchell d/b/a Oxford Die- Cast, Case No. D2001-0857 (WIPO Sept. 6, 2001) (Argy, Panelist), at http://www.wipo.int/domains/decisions/html/2001/d2001-0857.html; High Speed Prods., Inc. v Thrasher Magazine Ltd., Claim No. FA97008 (NAF June 20, 2001) (Meyerson, Panelist), at http:// www.arbforum.com/domains/decisions/97008.htm.

[27] Ibid.

[28] Thornburg EG, ‘Fast, cheap and out of control: lessons from the ICANN dispute resolution process’ (2002), 6 Journal of Small and Emerging Business Law 191, at 200.

[29] Weinberg J, ‘ICANN and the problem of legitimacy’ (2002), 50 Duke Law Journal 187.

[30] Lindsay D, ‘Internet domain name dispute resolution’ (2002), paper presented to BLEC congress 2002.

[31] Jones ML, ‘The internet and domain names – recent developments’ (2002), 5(9) TeleMedia 135.

[32] CH 1997, P No.2355.

[33] Upcroft A, ‘Trade marks as domain names: an Australian perspective’ [1999] MacarthurLawRw 5; (1999), 3 Mac LR 43.

[34] 947 F Supp 1227 (ND III 1996).

[35] Loundy D, ‘A primer on trade mark law and internet addresses’ (1997), 15 John Marshall Journal of Computer and Info Law 465.

[36] Upcroft A, ‘Trade marks as domain names: an Australian perspective’ [1999] MacarthurLawRw 5; (1999), 3 Mac LR 43.

[37] [2002] FCA 124 (22 February 2002).

[38] Including <sydneyflower.com.au>, <syndneyflowermarket.com> and sydneyflowermarket.net.au>

[39] Alderson M, Passing Off – Personality Rights And Trade Practices Law Sydney, Prospect Media, 1997.

[40] [1981] 1 NSWLR 196.

[41] British Telecommunications Plc v One in a Million Ltd [1998] EWCA Civ 1272; (1998) 42 IPR 289 at 302.

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