IP_Module 8

MODULE 8: BRAND MANAGEMENT AND COMMERCIAL OPPORTUNITY

8.1 BRAND MANAGEMENT: ‘PROTECTING AN ENTERPRISES’S MOST IMPORTANT IP’

‘Brand’ has become a flag that wraps a whole series of concepts. A brand is something with
which your enterprise is known to the public at large. It is a trademark. A Brand at its
narrowest refers to the mark used by an enterprise to distinguish its goods from its
competitors. This chapter concentrates on the marks or logos that an enterprise uses to
distinguish its goods or services from those of its competitors.

The value of brands can be many times more than all the physical assets owned by the
enterprise and Coca-Cola is perhaps the most prominent example. According to Researcher
Millward Brown Optimor, Coca Cola’s brand value in 2008 was US $ 58.2 billion.1 The
technology in which that business was founded is nothing more than a recipe. The company
clearly has a brilliant process for keeping secrets and building upon the competitive edge
that flowed from the recipe and the brand ‘mystique’ associated with the product. But as
Mr Coke-Is-It discovered, even the soft drink company could not prevent certain forms of
use. But then the above example is probably the ultimate confirmation of branding success.

8.2 PURPOSE OF BRANDS

Brands2 can be used to promote the business as a whole or specific products or services. A
brand may be used to promote a particular form of technology which is not necessarily
related to a product or service. The primary aim is to provide recognition to the enterprise
and to create a positive impact on the mind of its customers. This in turn will induce
(directly or indirectly and consciously or subconsciously) the client to choose the
enterprise’s products or services ahead of a competitor. This generates revenue and profits
which feeds back into the corporate governance role of satisfying the interests of
shareholders, investors and other stakeholders

Having brands is a means to differentiate a company’s products and services from those of
its competitors. Evidence shows that customers will pay a substantial price premium for a
good brand and remain loyal to that brand.3

Malcolm Macdonald has summed it aptly in his book that “it is not factories that make
profits, but relationships with customers, and it is company and brand names which secure
those relationships”4

A well-known brand can give to the enterprise an opportunity to set premium prices for its
products or services, attract a greater degree of ‘repeat business’, attract new clients or

1 Top 100 most powerful brands 08, Millward Brown Optimor available at
<http://www.millwardbrown.com/Sites/optimor/Media/Pdfs/en/BrandZ/BrandZ-2008-Report.pdf>

2 J. Thomas Mc Carthy, MC.Carthy on Trademarks and Unfair Competition, 4th Edn. Thomson
Reuters Vol I, Para 4.18.
3 Introduction to brands available at <http://tutor2u.net/business/marketing/brands_introduction.asp>
4 Malcolm McDonald, Marketing Plans, Institute of Marketing, Chartered Institute of Marketing, 4th
Edn. Butterworth-Heinemann (1999) p.162

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introduce new products or services. Brands can present licensing opportunities for the
purposes of driving additional revenue from associated or even unrelated products or
services. In fact the licensing of a brand may be a defensive measure. By permitting a
competitor to use the brand in accordance with the enterprise’s quality and marketing
controls the enterprise may be able to place a fence around the competitor’s activities and
be closer to that competitor’s activities.

So an enterprise that has established a well-known brand can be better placed to drive
revenue for its business. Leveraging those brands becomes another form of
commercialisation of the enterprise’s IP.

8.2.1 ELEMENTS OF BRANDING

The selection and building of a brand comprises many elements. At the outset 1) the
management of brands should be understood in the light of the business of the enterprise
as a whole and 2) the strategy to be applied to the communication of brands will vary
according to the fluctuations encountered by the enterprise over time. Not only must 3) the
enterprise understand what the client desires or demands, it must also form a view as to
whether the enterprise wants to be positioned to fulfil that desire or demand. This
inherently involves an understanding of whether other organisations are already fulfilling
those desires or demands and deciding whether those competitors are doing it better than
the enterprise itself. 4) The objective of the brand and the brand strategy should be
designed to assist the enterprise to distinguish, in the mind of the client, the enterprise, its
products or services from its competitors.

Illustration 1

Elements of Branding
Strategy

1. Business of 2. Strategies 3. Understand 4. To
the enterprise applied by the customer’s
the enterprise demands plus distinguish the
to understand enterprise’s
communicate whether it products with
the brands really wants to
fulfill the that of its
demands or
not competitors

Hewlett Packard (HP) introduced the ‘Invent’ slogan as part of its brand to emphasise that it
was a ‘smart’ company, not just a seller of IT hardware. The brand value of HP in 2008 was

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US $29.2 billion.5 Intel introduced the ‘Intel inside’ slogan to achieve greater recognition
from all of those consumers who touched a product that relied on Intel’s semi-conductor
chips. It left the consumer with the impression that if the PC did not have the slogan then
the PC must be lacking something. The brand value of Intel in 2008 was US $ 22.1 billion. 6

It has been argued Jack Trout, in his book7 that HP’s branding strategy was misplaced
because the strategy did not differentiate HP or its products from its number one
competitor, IBM. Whether any strategy is successful depends on the objective of the
strategy. The strategies would become more varied and multi layered as an enterprise
grows. The ultimate corporate strategy of delivering profit for shareholders depends upon a
wide range of factors. The management team bears the responsibility of assessing the
importance of those factors at different times in the life of the enterprise. The importance
of the brand in those phases will vary.

The importance of brands needs to be kept in perspective. The success of any brand is
intricately linked with the success of the business itself and the reputation of those who are
responsible for managing the enterprise. There is not much point in ploughing thousands of
dollars into a brand development unless the business has the fundamentals to succeed.

8.2.2 WHAT IS TO BE BRANDED?

As noted, the form of brands that can be protected as registered trademarks is very broad.
Is the brand to apply to the enterprise as a whole, a product or service or a combination of
all of them? Is there good reason to distinguish between them? These questions will re-
occur as the enterprise grows, expands its client base and identifies new opportunities that
are related to its core business.

Using an existing well-known brand for a new product or service can give a springboard into
the new activity. There may be efficiencies gained from being able to market multiple
activities under one campaign. It obviously avoids the time and expense of creating new
brands. There are of course risks to such ‘brand extension’. If the new activity is not
successful the value or goodwill of the brand may be damaged. If the new activity is in a
field different to the traditional activities of the enterprise there may be confusion in the
marketplace about the message that is associated with the brand. From a commercialisation
perspective sticking with the existing brand also means that the enterprise is not building its
portfolio of IP which in. turn may result in lost opportunities to achieve other leveraging
opportunities such as through licensing or assignments of the IP.

8.2.3 SELECTION OF THE BRAND

The following five characteristics have been identifies by Keller (p 70) as critical to a
successful brand:

5 Supra Note 1
6 ibid
7 Jack Trout, Big Brands Big Trouble – Lessons Learned the Hard Way, John Wiley & Sons (2002) pp
182 - 185

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• Memorable. It should be short; easy to say and write; easily pronounceable. This
may entail the selection of a catchy name but also the use of logos, mascots slogans,
packaging or personalities; the essence of a trademark is that it is some distinctive
thing, which points out that the goods are the goods of AB. This was decided in the
case of Richard v. Butcher, (1891) 2 Ch. 522 in England way back in the year 1891;

• Available and protectable. A brand should be available in the market which means
that it is not in use by any other enterprise. Moreover that brand should be easily
protectable;

• Transferable. Portable across product, geographic and cultural boundaries so that
the enterprise can implement consistent strategies and marketing campaigns to
meet a range of market opportunities;

• Adaptable for new trends. Names and logos that may capture the ‘cult’ of a certain
period of time may forever be linked to that period and instead take on an 'old
fashioned' feel;

• Meaningful. In the sense that it is credible, having regard to the nature of the
enterprise's business without being too descriptive so as to jeopardise the protection
afforded to the brand. Choosing the name of an animal for a brand name, such as'
Jaguar', will presumably conjure in a person's mind the positive characteristic that is
associated with the animal.

8.2.4 AVOIDING SIMILARITIES

The selection of an appropriate brand must address the legal pitfalls. A brand should not be
similar to any existing brand or else the enterprise may be at risk of violating the Trade
Marks Act, or the tort of Passing Off.

This can become an expensive exercise where the enterprise that spent money on graphic
designers, other consultants in developing the brand, stationery and media and advertising
costs only to find that another person can obtain an injunction. In a worst case it may have
to pay extra money for damages because of the unauthorised use of another person’s
brand.

These pitfalls emphasise the need to undertake thorough searches before adopting a brand.
An enterprise should search the following information resources and seek advice on the
results of those searches:

• Trademarks register; laid down under section 6 of the Trademarks Act of 1999.
• Domain names register;
• General Internet search;
• Trade and telephone directories;
• Brand compilation publications;
• Companies register; Section 147 and 148 of the Companies Act
• Business names registers.

A brand encompasses a copyright work and the enterprise should seek consent from the
author for the use of the brand because, without that consent, such use may otherwise
infringe the author’s moral rights.

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8.2.5 SOME NAMES CANNOT BE USED AS BRANDS

The Trademarks Act provides for grounds for refusal of registration of trademark/brand in
the course of business. Certain names are unacceptable for registration under Section 9 and
Section 11 of the Trademarks Act. This will limit the names that can be selected for the
brand of the enterprise.

8.3 SECURING OWNERSHIP

As has already been noted, the ownership of IP in any drawing and logos, to the extent
copyright exists, will be owned by the author. The law is laid down under section 17 of the
Copyright Act 1957. Any enterprise engaging a graphic designer to assist with the
development of a brand must ensure that the contract transfers ownership of any copyright
or other IP rights to the enterprise together with the relevant warranties and indemnities.

8.4 IBM AND ITS BRAND POSITIONING

If we look at IBM which has sold its PC division to Lenovo, is benefitting from the brand
position which IBM had while it manufactured PCs. “The addition of the IBM brand provides
Lenovo with the luxury of being able to differentiate by other means. With the IBM brand,
Lenovo can introduce elements of service and industry leadership, but without incurring the
costs of establishing IBM's high-value skilled-labour operation. Lenovo paid US$ 650 million
cash and $ 600 million in shares in the IBM transaction. Much of this value clearly stems
from the IBM brand (both removing it as a competitor and acquiring it), rather than its
tangible assets (that is, the equipment and existing operations). The IBM brand brings kudos
to Lenovo. It removes a barrier to Lenovo's products-particularly outside of China. Lenovo
now seems more reliable, more trustworthy. Even to customers who are fully aware that
the product is no longer “made” by IBM, a stamp of approval from such a highly respected
company means a lot in any market.”8

8.5 NIKE AND ITS BRAND POSITIONING

As Bedburry writes in his book ‘A new brand world’, Nike reinvented its marketing and
products to a great extent. The Nike brand became a category protagonist for competitive
sports and fitness. Nike advertising took thousands of approaches for its core brand
positioning during the time of Bedburry’s tenure in Nike. The company’s advertising
department was constantly on the move by refreshing the marketing and brand positioning.
Nike design became one of the world’s premier product design and development
organizations. It introduced newer products in the markets and regular intervals at such
frequency that the average product life cycle fell from One year to just three months.9 By
this move Nike made sure that its brand was quite well positioned in the market.

8.6 COMMUNICATING THE BRAND

8 Chris Grannell, IBM reboots February 7th, 2005 available at

<http://www.brandchannel.com/features_profile.asp?pr_id=217>

9 Scott Bedburry, ‘A new brand world’ Penguin (2003) p.4

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8.6.1 COMPARATIVE ADVERTISING

In any comparative advertising must be able to be substantiated. The products and services
that are being compared must be truly comparable. Not only is there a risk of damages and
injunctions but an aggrieved party must also obtain an order for the enterprise to publish a
correction.

8.6.2 SPONSORSHIP

The use of personalities and in particular elite sports people has become a common means
of achieving an aesthetic attribute to a brand. Of course, fundamental in this exercise is
obtaining the consent of the personality. This sounds so fundamental that it is amazing that
it doesn’t happen. In the famous Australian Case of Gary Honey Vs Australian Airlines Ltd.,
(1990) 18 IPR 185.The predecessor to Qantas, TAA, used a picture of an Australian athlete in
an advertising campaign without his consent. Although the athlete failed in his court action
against TAA, the decision to publish the poster depicting the athlete jumping through the air
cost both the airline and the athlete valuable time and money.

8.6.3 MEDIUM FOR COMMUNICATION

The communication of the brand involves both internal and external measures. The medium
will be influenced by the enterprise’s objectives, budget and timing. An enterprise whose
revenue is generated from other enterprises, rather than the general consumer, is more
likely to focus on trade and professional media than electronic media. It is beyond the scope
of this chapter to analyse the issues inherent in media and advertising campaigns although
there is no doubt that these elements can be instrumental in the brand strategy being
successful or not.

8.6.4 INTERNET IMPLICATIONS

The advent of the Internet may be seen by many as introducing a new era for branding and
that it should entail a different strategy with new names and new legal challenges. Does the
Internet medium require a different profile than would be required in an offline
environment? As brands are dictated by the objectives of the enterprise, the answer will
largely be determined by the role of the Internet in the business model of the enterprise.
For some products that embody IP, such as books and software, the Internet presents a new
distribution method. For enterprises that generate revenue by relying on the provision of
services that exploit the know-how of individuals the Internet may only present a new
channel for communication.

The number of domain sites now available adds greater complexity to branding through the
Internet. It raises challenges for protecting the brand from cyber squatting as greater
number of domains can be used to register a domain name that uses existing brands. It has
been estimated that a major organisation will need to register at least 300 name variants in
order to protect its core brands. Of course the breadth of choice may give enterprises with a
portfolio of brands an opportunity to spread its brand recognition. Historically an enterprise

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has had to make a choice as to which of its’ brands it wants to use for an online
environment. McDonalds initially chose to use ‘McD.com’ as its domain name and was
caught out when a journalist from Wired magazine registered ‘McDonalds’. This resulted in
a settlement that saw McDonalds fund personal computers for a New York school in order
to retrieve the McDonalds’ domain name.10

8.7 MANAGING THE BRAND

Having established a brand for the enterprise or its products or services the onus remains on
management of the enterprise to maintain the support for the brand. Generally this involves
3 principles:
• Consistent use of the brand - not changing the makeup of the core elements of the

brand unless such change is dictated by a change to the parameters for the business
of the enterprise;
• Consistent use of the message or values that are associated with the brand;
• Ensuring that the marketing and business activities and the message that staffs issue
to the market reinforce the ‘brand position’. The form that this reinforcement takes
depends in large part on the nature of the business, how competitors also seek to
respond to the enterprise’s marketing and business successes or failures and
external impacts on the business of the enterprise.

Management of the brand involves all persons who take part in the business of the
enterprise. Poor performance by people or the products will adversely affect the brand.
Arguably the ultimate international brand, the Olympics, has been the most successful in
crossing geographic boundaries. Yet that brand has suffered due to scandals on and off the
sporting field which affect the ability for host cities to attract sponsors and assist in the
funding of the event.

8.8 RESPONSIBILITY FOR MANAGEMENT OF BRANDS

The importance of the brand to the enterprise will have a necessary impact on who has
responsibility for its management and key decisions on how the brand is used. It is more
likely that senior executives and the CEO will be intimately involved in the development of
the strategy for use of the brand where the brand has a direct and significant impact on the
revenue of the enterprise. Companies such as Coca-Cola that has intangible assets
representing 92 per cent of its market capitalisation are more likely to involve a CEO or
other senior managers in strategies for its use.11

8.8.1 PROTOCOLS

10 J. Quittner, (1994). Billions Registered, Wired. Available at
<http://www.wired.com/wired/archive/2.10/mcdonarlds.html>
11 ibid. Also see The Coca-Cola Company (KO), Balance Sheet of the year 2008 available at
<http://finance.yahoo.com/q/bs?s=KO&annual>

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The protocols that an enterprise implements for practical use of registered trademarks
should encourage the maintenance of legal protection of the trademarks. Staff should
understand the risks of misusing the trademarks when implementing a branding strategy.

The following table outlines the risks of not complying with standard brand protection
protocols:

Risk –Trademark Use

Protocol Risk of Non-compliance
The mark becomes generic for the
When using the mark in printed applicable goods or services and is
form, depict the mark in UPPER used as a descriptor rather than a
CASE differentiator
The mark becomes generic for the
Never use the mark as a verb or a applicable goods or services and is
noun, used as a
e.g., ‘The athlete wore REEBOKS’ Descriptor rather than a
differentiator
Use the mark as an adjective, e.g., The mark becomes generic for the
‘athlete wore REEBOK shoes’ applicable goods or services and is
used as a
Always use the trademark in the Descriptor rather than a
form that it is registered, e.g., if differentiator
the registered trademark consists
of a word ad a logo the depiction An opponent may assert that the
of the mark on brochures, mark has not been used in the
letterheads etc should bear both form that it is registered and so
the word and the logo should be removed from the
Always use the mark in a trademarks register
consistent manner, e.g., do not
chop and change the components The value of the brand is not
of the mark reinforced and maximised

Management of the brand entails implementing an enforcement strategy. Without it the
value of an enterprise’s brand becomes diluted and, at worst, there is a risk that the
enterprise may lose ownership of the brand.

8.9 LICENSING

The licensing of brands is characterised as being low cost, quick, low risk and profitable. It
has the advantage of expanding and reinforcing consumer and retail awareness. It
strengthens trademark protection by attracting the authorised user provisions of the Trade
Marks Act under Section 48 and 49.

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In Gujarat Bottling Co. Ltd. v. Coca Cola Company AIR SC 1995 2372, the court held that the
use of a registered trademark can be permitted to a registered user in accordance with the
provisions of the Act and for that purpose the registered proprietor has to enter into an
agreement with the proposed registered user. The use of trade mark can also be permitted
de hors the provisions of the Act by the grant of license by the registered proprietor to the
proposed used. Such a license is governed by common law.

When used wisely and consistently it enhances the presence of the brand. It can enable the
brand to be used beyond the core customer set and applied to new product lines and
distribution channels.

8.10 ANALYSING THE COMMERCIAL OPPORTUNITY

For an enterprise or an individual, the plunge into the vast ocean of commercialisation
without experience is quite a difficult task. It has been observed in India that the failure of
small and nascent businesses is quite high and the support which young entrepreneurs get
is quite low.

Like any other aspect in life, success in commercializing Intellectual Property depends on a
range of factors not least of which is the identifiable ‘luck’. But as the legendary golfer, Gary
Player once said, ‘The more I practice, the luckier I get’. So it is with commercialising IP.

In order to achieve success the first part of ‘practice’ is doing your homework, which
involves collecting information, talking with those who have been through similar challenges
and identifying the sources of risk. All of this is another way of saying that the entrepreneur
needs to plan. Only through planning you (enterprise) can achieve your (its) goals.

Now a question which any would ask is what is the meaning of the term
‘Commercialisation’? The answer is simple: ‘a mechanism that encourages and facilitates
the use of IP while deriving a fair return on the investment in the creation of IP.’
Commercialisation of Intellectual Property can only be done if you have a plan of action.
This plan of action in the commercial world parlance is a ‘Business Plan’

8.11 BUSINESS PLANS

Business plans basically serve two functions. First they are one of the main tools that
investors employ to evaluate the company as a potential investment and secondly they
provide a road map for the company based on rigorous professional analysis of the
business.12

It should also be noted that a business plan should be articulated carefully and addressed to
a specific readership. ‘A well written business plan can be used to summarise the state of
the business as a basis for judging the need to secure extra funding.’13 As a stand alone
document is should pre-empt any questions, which the readers of the business plan would

12 Claas Junghans et al, ‘Intellectual Property Management’, Wiley-VCH (2006) p. 130
13 Adam Jolly, Design Council, ‘Innovation: Harnessing Creativity for Business Growth’, Kogan Page
Publishers (2002) p.26

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have with regard to the IP, which the enterprise owns. It is a fact that in this era of massive
economic expansion and development in the field of IT, there are many companies which
are looking for potential investors. Therefore professional articulate and convincing
presentation is essential for a business plan.14

In essence the entrepreneur should write a business plan. Outsourcing that activity to a
third party is not advisable as it carries the risk that it does not convey the vision of the
enterprise and the critical in-depth detail that may catch an investor’s eye or present
confidence in the ability of the entrepreneur.

An enterprise may be able to proceed without a business plan for a period while its original
and core participants continue to participate in the enterprise beyond its embryonic states.
In that phase all participants have a common objective and understanding of the principles
and expectations that are held by each of them. The business planning may be carried out
informally between them. As the business becomes more complex the need for considered
planning increases to ensure that the risks and opportunities are identified, analysed and
addressed. When the time comes to convince others of the opportunities that lie with the
enterprise, then the business plan comes into its own in assisting the entrepreneur to tell
and sell his or her story.

FIGURE 1
Two forms of a Business Plan

Business Plan

A document for use by A document which is
the enterprise itself. intended to be
This is tool to enable presented to third
the entrepreneur to parties such as
focus on the business investors and
of the enterprise. financiers tool.
.

A plan intended to persuade others of the attractiveness of the enterprise or the technology
would be expected to address the following aspects:

8.11.1 BUSINESS PLAN CONTENTS

• Background of the enterprise including its history, its missions and current
operations.

• The salient points of the business and the entrepreneur’s plans for the future.
• The financial targets of the enterprise and also its non financial objectives.
• The technology owned by the enterprise and its development status, its features, the

challenges to be overcome and the competitive advantage that it provides.

14 Supra Note 1

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• A complete market analysis of the industry in which the enterprise operates
including trends, the competitors, competitive advantage etc.

• The management teams skills, background, experiences, strengths, weaknesses and
the organizational structure.

• Identifying the risks associated with the enterprise and how they are intended to be
addressed.

• In order to attract a specific investor, the plan should include the terms of the
investment sought by the entrepreneur.

The business plan directed at investors should emphasise the opportunity for the investor
(but avoid unrealistic financial projections), contain a clear and honest analysis of the
competitors to the enterprise, be reviewed by confidants of the entrepreneur before it is
submitted to investors and be regularly reviewed and treated as a ‘living’ document.

8.12 MARKET ASSESSMENT AND ANALYSIS

Authors Robert E. Stevens, Philip K. Sherwood, J. Paul Dunn, David L. Loudon in their book
refer to three essential factors that influence an analysis of market opportunities15:

• External considerations: an analysis of market size, competition, economy,
regulatory issues, political conditions, social change and nature (such as weather).
This involves significant commitment of time and money in terms of direct and
opportunity cost;

• Financial considerations: revenue estimates, cost estimates and return on
investment. This analysis is undertaken if the external analysis suggests a favourable
opportunity. Its aim is to determine the potential profitability of the enterprise
arising fro the commercialisation of the technology or the IP;

• Internal considerations: organisational mission, corporate objectives and resources.
This analysis will assist the entrepreneur to determine whether the enterprise has
the ‘where-with-all’ to take advantage of the commercialisation opportunity.

Many texts address the identification of ‘market’ in terms of geography or demography.
Analysing the market opportunity inevitably involves forming a view on whether there will
be a demand for the technology and whether there are adequate sources of supply to meet
that demand.

The approach to analysing a market will depend in part on whether the technology has been
developed (in whole or in part), remains an idea and whether the technology has
competitors. These factors will affect the methodology and data used to analyse the market.

Start-up and small enterprises will have difficulty in addressing all of the above questions in
detail. This emphasises the challenges for IP commercialisation by Indian enterprises.
However, the discipline of addressing these questions will benefit the enterprise. If nothing
else, the lack of information in response to any of those questions will emphasise the risks
faced by the enterprise. From that point the enterprise can evaluate and treat those risks.

15 Robert E. Stevens, et al, ‘Market opportunity analysis’ Haworth Press (2006) pp 4 – 7.

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8.13 WHAT PROBLEM DOES THE TECHNOLOGY SOLVE?

An entrepreneur considering whether to start up an enterprise based on technology or an
investor considering a commitment towards an enterprise will want to understand the
nature of the problem that the technology or the business of the enterprise intends to
solve. Essentially this is an exercise of assessing the ‘market size’ that the technology or the
business of the enterprise may reasonably achieve. The second important factor will be the
proportion of the market that the enterprise may be able to capture with the new
technology.

The reasonableness of the market share that can be acquired by an enterprise in respect of
a particular market will vary greatly. Factors such as the profit margin that the enterprise
can derive and the turnover of the product illustrate this principle. The assessment becomes
somewhat harder for a start-up company where there are no historical value that can be
placed on a market.

8.14 SUPPLY SIDE

The supply of the solution to the problem usually entails the involvement of not just the
enterprise, but also other organisations with which the enterprise must rely on or compete
with. Although IP laws may bestow monopoly economic rights in relation to particular
technology that does not usually result in an automatic monopolistic position to solve the
problem. More often than not there are organisations already trying to provide a solution
and the enterprise must compete. Commercialisation of the technology to meet the
problem will involve consideration of the following factors.

Focusing on the technology that presents a solution to the problem is a threshold issue. Is
the technology fully developed? What more is required to complete the development? How
complete a solution to the problem is the technology? Are other technologies or know-how
needed to present the full solution? The answers to these questions will inform the
entrepreneur of the need to apply more time and funds to the technology.

The analysis should extend to other competitive technology that exists. How does the
enterprise’s technology rank against its competitors? What gives the enterprise’s
technology an edge? It may be that the technology is more efficient, has additional
attributes, and is easier and cheaper to produce.

8.15 WHO CAN SOLVE THE PROBLEM?

Invariably the enterprise will need associates to successfully commercialise the IP. Asking
who could and would be interested in the enterprise’s solution to the problem will affect
the commercialisation strategy. Once this list is drawn an analysis involving these questions
will help refine the direction for the enterprise:

What can the partner bring to the Why have the partners not done it
strategy that the enterprise themselves?

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cannot? What ‘extra’ must the partners do
What is in it for the partners? to bring the solution to fruition?
Red riding hood complex’: what
Does the enterprise know these could result in the partner taking a
potential partners already? Do direction that is inconsistent with
they have a similar culture to the the strategy of the enterprise?
enterprise?

The ability to adequately supply the technology to solve the problem will also be influenced
by actual or potential competitors to the enterprise. The following tests will assist the
entrepreneur to determine how strong its competitive advantage will be:

8.16 TESTING COMPETITIVE ADVANTAGE

How easy is it for someone else to Who could or would be interested

develop competitive technology? in competing? How well resourced

Do they have to spend a lot of are they compared to the

time or money to do so? enterprise?

How may persons could be What advantages do or will they

material competition to the have over the enterprise?

enterprise?

What factors place those Would other persons be

competitors in a less interested or already compete in

advantageous position? the same segments of the market

that the enterprise intends to

focus on?

An understanding of the industry that addresses the problem will enable the enterprise to
foresee the risks associated with commercialising the technology. This involves analysing the
industry structure. Who are the leaders and why are they the leaders? What are the
distribution channels? What are the barriers to entry?

Understanding where the industry is heading will affect whether the technology has a long-
term future. At what stage in the economic and development cycle is the industry?
Understanding the economic foundations for the industry including the level of, and reliance
upon, capital investment, cost structures for operation and average profit margins enables a
view to be formed about the barriers to entry into the market.

8.17 DOMAIN NAME DISPUTES IN ASIA

There have been two interesting cases involving SAP AG. SAP AG & Anr. v Manu Kosuri &
Anr.16 was the first Indian case where NSI acting under Clause 10B of the NSI Domain name
Dispute Policy, deposited the title papers of the infringing domain name ‘sapindia.com’ in
the High Court of Delhi. The defendant in this case had registered about 100 well known
trade marks as domain names.

16 Unreported ex parte interim injunction order; Suit no.160/99

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In SAP AG & Anr. v Davinderpal Singh Bhatia & Anr.17 the defendant who had registered
‘sapwizard.com’ and ‘sapmaster.com’, offered to sell the two domain names to SAP America
for US$ 38,000. The defendants were immediately restrained by the Delhi High Court.

In Tata Sons Limited v. Ghassan Yacoub & Ors.18 ASAP Solutions of California, USA,
registered the domain name ‘Tatagroup.com’ with NSI and on receipt of a cease and desist
notice from the owner of the trademark TATA, transferred the same to Tata group located
at New York. The Plaintiff filed a suit for injunction restraining passing off and dilution of its
well know trademark TATA, against both ASAP Solution and Tata group. The High Court of
Delhi granted an ex parte interim injunction against the defendants restraining them from
using and transferring the infringing domain name TATAGROUP.COM. This is the first
domain name case where the court has accepted the contention put forth by the plaintiff
that in matters concerning internet communications, which have trans-national
ramifications, the effect of the impugned transactions in India is an important factor for
determining jurisdiction. The court also considered the principles of Private International
Law including the courts’ ability to enforce the injunction against the defendant.

NASSCOM, India’s largest software association comprising over 500 software companies,
was shocked to find that someone had registered NASSCOM.NET and was approaching
NASSCOM to launch a web site consisting of NASSCOM’s members. The defendant
concealed the fact that it had registered NASSCOM.NET and perhaps hoped for NASSCOM’s
permission. The plaintiff has a web site “www. Nasscom.org” and upon discovering the
defendant’s web-site NASSCOM.NET sued them19. The Delhi High Court immediately
stopped the defendant from using the name NASSCOM in any manner whatsoever.

In New Zealand, several interesting developments have taken place on the Internet front. In
Oggi Advertising Limited vs. McKenzie Baragwanath20 a mandatory interlocutory injunction
was granted by the High Court requiring that the registration of the domain name
‘Oggi.com.nz’ be passed to the plaintiff. In another significant case in September 1996,
consent orders were granted against The Domain Name Company Limited, which had
registered approximately 50 of New Zealand’s most well known trademarks.

Hong Kong is another country where there has been a domain name litigation instituted by
Hong Kong Mass Transit Railway Corporation (MTRC) against a local company named
Beezweb Productions Ltd. which registered MTRC.COM21. The case was finally settled when
the proprietorship of the domain name was given to MTRC.

The Thailand Government seriously considered taking legal proceeding against a cyber
pirate, Mr. Cooney Carey. The Thai Government’s Amazing Thailand campaign had been
promoted heavily in mid-1996 to attract tourists. Mr. Carey approached the Thai
Government offering to sell the domain name ‘Amazing Thailand’ which he had registered

17 Unreported ex parte interim injunction order; Suit No. 735/99
18 Unreported ex parte interim injunction order; Suit No. 1672/99
19 National Association of Software and Service Companies v Rajesh Mittal & Ors, [Suit No. 1934/99]
20 J CP 147/98 Auckland Registry
21 APAA News (Issue No.26, July 1999 at page 63)

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with NSI. This strategy was foiled when the Thai Government made it possible for users to
access the Amazing Thailand site through http://www.tourismthailand.org22.

Singapore had a case involving a domain name dispute. The plaintiff’s claim was based on
passing off. The plaintiff, Singapore Post Pte. Ltd., had registered and was using the domain
name singpost.com.sg and the company name was abbreviated to ‘Singpost’. The
defendant, Cyberville Technologies Pte. Ltd., registered and used the domain name
singpost.com to offer an e-mail redirection service under the name of ‘SingPOST’23.

An interesting Australian case revolving around trademarks/domain names and the Internet
had the Australian Competition and Consumer Commission (ACCC) taking action against
Internic Technology Pty. Limited and Peter Zmijewski for engaging in misleading and
deceptive conduct by using an almost identical domain name24. It was alleged by ACCC that
consumers looking for INTERNIC ended up at the defendant’s site by entering ‘Internic’ or
‘Internic.com’ into their web browsers. In the meantime, the defendants had also applied
to register ‘Internic.com’ as a trademark for a number of services.

8.17.1 SPECIFIC PROBLEMS OF ENFORCEMENT

As with any unchartered territory, so also with Internet cases, the path that law takes is yet
to be evened out. Each case throws up new and hitherto undealt with problems.

The typical problems faced were:

• dealing with a multitude of registrations of a well-known trade mark like TATA with
some alpha-numeric variation thereby making detection, monitoring and elimination
an impossible task,

• the dilution of the well-known status of the mark due to the availability of a plethora
of deceptively similar marks,

• effecting service on the defendants as it was found that in most cases the address
given was fictitious,

• the possibility of the erring party transferring the domain name to a third party on
being served with a cease and desist notice,

• proceeding against the wrong person as the registrant was merely an agent and not
the real entity owning the website,

• the registrant's name continuing to be on the NSI listing inspite of it not paying up
the registration fees within the prescribed time period.

The one problem that has no easy solution is of establishing jurisdiction of the courts in
India. The issue that arises would centre on whether courts in India have jurisdiction, where
the domain name has been registered by an overseas body, or where the main server is
located overseas. Another moot question is whether domain name registration with NSI
and the availability of the NSI ‘whois’ query report in India would be enough or would the
criteria be centred around the degree of contact with India. The answer to this can neither

22 Trademark World (Issue No.109, August 1998 at page 31)
23 Trademark Law & The Internet (INTA, 1999 at page 362)
24 ibid. at page 268

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be simple nor a standard one and would only be possible on a careful and reasoned
assessment of the facts of each case.

The problem of mushrooming of unauthorised domain names could perhaps be addressed
by a watch-dog type of agency, with whom trade mark owners can register themselves, and
who would in turn intimate the latter as and when someone tried to appropriate their trade
mark as a domain name, so that appropriate action could be taken. Such a solution is not
unknown in the trade marks world, where many agencies exist and warn the rights owner,
each time that a conflicting trade mark application is filed at the concerned Trade Marks
Registry.

8.18 ONLINE SERVICE PROVIDER LIABILITY

An important issue is that of the potential liability of online service and access providers for
infringements taking place through their services. As noted above, the following questions
are raised: Are service providers exercising the exclusive rights of the copyright owners
themselves, as they engage in acts that cause the material to be copied and transmitted?
Regardless of the answer to this question, can service providers be held legally responsible
for the unauthorized exercise of those rights by individuals using their services, where the
services make the transmission possible? Under the laws of many countries, the answer
could be yes, depending on the circumstances.25

The liability issue has significant international implications. Because the Internet is a
borderless medium and its markets are global, it is critical that compatible approaches to
this issue be adopted around the world. It is not necessary that the approaches be identical;
they may differ depending on the particular circumstances and legal traditions in any given
country. But they must be interoperable if global networks and electronic commerce are to
develop smoothly.

During the Diplomatic Conference on the Internet treaties in 1996, the issue was intensively
debated. The ultimate result was that the treaties are essentially neutral on the subject,
with the issue of liability left to national legislation to determine. There is, however, one
reference to the issue, in an Agreed Statement to the WCT, which says, “It is understood
that the mere provision of physical facilities for enabling or making a communication does
not in itself amount to communication within the meaning of this Treaty or the Berne
Convention.”26 The statement clarifies that simply providing the wires used to
communicate, for example, does not constitute an act of communication. But the
statement is limited in its application: it does not cover a number of activities that service

25 Various countries’ copyright laws contain concepts of liability for contributing to the infringing
activities of another. Generally, the determination of liability will turn on the degree of participation
and knowledge of the party that is contributing to the infringement. For discussion of various
approaches to this issue, including the United States Digital Millennium Copyright Act and European
Union Ecommerce Directive, see presentations of T. Casey, Senior VP Technology Law Group, MCI
Worldcom, M. Fröhlinger, Head of Unit, Media, Commercial Communications and Unfair Competition,
DG XV, European Commission and S. Perlmutter, Consultant, WIPO, WIPO International Conference
on Electronic Commerce and Intellectual Property (September 1999), at
http://ecommerce.wipo.int/meetings/1999/index.html.
26 See Agreed Statement Concerning Article 8, WCT.

155

providers may engage in, and it does not deal with concepts of liability for contributing to
the infringement of another.

Since 1996, a number of legislative solutions have begun to emerge. These statutes differ in
whether they address copyright only, or take a “horizontal approach”–that is, a rule
governing liability of service providers regardless of the grounds for illegality of the
transmitted material. (In other words, the horizontal approach covers not only copyright
infringement but also other laws such as libel or obscenity). There are laws now in force in
Germany and Sweden, which approach the issue from a horizontal perspective. The
European Commission has proposed a Directive on Electronic Commerce with provisions
that would harmonize the treatment of liability among its Member States, again using a
horizontal approach.27 In the United States of America, the Congress has enacted copyright-
specific legislation as part of the 1998 Digital Millennium Copyright Act, after legislation in
past years establishing different standards in other areas of the law. Singapore too has
adopted a copyright-specific law.28

8.19 TRADEMARKS AND UNFAIR COMPETITION

Trademarks are an important tool in commerce. A trademark enables consumers to identify
the source of a product, to link the product with its manufacturer in widely distributed
markets. The exclusive right to the use of the mark, which may be of indefinite duration,
enables the owner to build goodwill and reputation in the expression of its identity, and to
prevent others from misleading consumers into wrongly associating products with an
enterprise from which they do not originate.

Trademarks are of essential importance in electronic commerce. Indeed, it has become
clear that trademarks will assume at least as much significance on the Internet as they carry
in the off-line world. Enterprises need to build recognition and goodwill, and inspire
confidence in themselves and in their brands. Particularly when operating in virtual markets
in which face-to-face interactions are infrequent and there is little or no opportunity to
inspect goods or services before purchasing them, consumers are willing to reward trusted
sources offering competitive products.29 In these circumstances, a company’s mark or
brand becomes a vital means of identifying and distinguishing itself.30

27 See discussion on issues of liability in cyberspace and the European Union Draft Directive on
Electronic Commerce in the presentations of C. Clark, General Counsel, International Publishers
Copyright Council and M. Fröhlinger, Head of Unit, Media, Commercial Communications and Unfair
Competition, DG XV, European Commission, WIPO International Conference on Electronic
Commerce and Intellectual Property (September 1999), at
http://ecommerce.wipo.int/meetings/1999/index.html.
28 The Global Business Dialogue on Electronic Commerce recently issued a position paper on
the issue, in which it recognized both the DMCA and the current draft of the European Directive as
appropriate models for internationally compatible approaches. See “Liability,” Issue Group Policy
Paper: Final Draft, GBDe (August 3, 1999).
29 It may be noted that certain informational goods, such as software and data, are almost
inherently non-transparent, meaning the consumer cannot detect the quality of the goods up-front.
Consumers will be relying in large part on the reputation of the seller, and place value in the
relationship with that company and its ability to provide service (including future product upgrades).
See comments of Prof. B. De Long, Dept. of Economics, University of California at Berkeley,
“Analytical Summary and Report,” The Digital Economy in International Perspective: Common

156

There is a growing international consensus that trademark protection should extend to the
Internet, and that it should be neither less nor more extensive than that which subsists in
the physical world.31 The existing national or regional legal systems should apply, together
with the relevant international treaties,32 but these provisions are of a general nature,
applying on a territorial basis, and are not tailored for the borderless world of electronic
commerce. They therefore are placed under considerable strain when confronted by the
challenges of this new medium of commercial exchange. Moreover, these challenges are
not limited to trademarks; they exist with regard to all kinds of distinctive signs used in
electronic commerce, including trade names and geographical indications.

8.20 ESTABLISHMENT AND MAINTENANCE OF TRADEMARK RIGHTS

As soon as a trademark is used on the Internet, it is immediately visible to a potentially
global public and might be considered to have a global effect. This particular feature of the
Internet makes it extremely difficult for businesses to foresee in which countries their
business activities might become legally relevant. Even within the boundaries of a single
legal system, it is often difficult to fit the “use” of a trademark on the Internet into
traditional legal concepts. Due to the particularities of Internet technology, such use can
take forms that can hardly be assimilated to use of a trademark in the physical world.

When trademark protection depends on prior use in a particular country, the question
arises whether use on the Internet can satisfy such a use requirement and, if so, what kind
of use would qualify as “genuine use.” Use is important in order to maintain a trademark
registration since, in most countries; a trademark registration is subject to cancellation if the
trademark has not been used within a certain period of time.33 It seems that use of a
trademark on the Internet may qualify as “genuine use” for the purposes of use
requirements.34 The trademark owner will have to show that its trademark was actually
present in that market, for example by proving actual sales or other commercially motivated

Construction on Regional Rivalry, Conference of the University of California E-conomy Project (May

1999), at http://e-conomy.berkeley.edu.

30 Trademarks, and branding in general, have become extremely important in electronic

commerce to build consumer familiarity and trust. This is particularly the case in light of the huge

number of new web site offerings, and their potential to overwhelm consumers. The costs of

establishing and defending a brand through advertising and other marketing activities represents a
very significant expense and “is the main reason why many business-to-consumer e-commerce
merchants have yet to report a profit.” See “The Economic and Social Impacts of Electronic

Commerce: Preliminary Findings and Research Agenda, at Ch.4, p.12, OECD (1999) (emphasis

added). See WIPO document “Use of Trademarks on the Internet: Issues Paper” (SCT/3/4),

31

para.6; see also, Report of WIPO Internet Domain Name Process, at para.34, (WIPO 1999), at

http://ecommerce.wipo.int.

32 See Paris Convention for the Protection of Industrial Property (the Paris Convention),

to which 155 States are party: in particular, Articles 4, 5C and D, 6-7bis, 9-11; and the TRIPS

Agreement, by which 135 States are bound: articles 15-21 (for trade- and service marks), Articles 22-

24 (for geographical indications). Article 15.1 of the TRIPS Agreement for the first time provides a

definition of a trademark (see above). Article 16 of the TRIPS Agreement specifies the rights

conferred on the trademark owner.

33 Under Article 19 of the TRIPS Agreement, the trademark owner has to be given at

least three years before its registration will be cancelled.

34 See WIPO document SCT/2/9, paras.60-61.

157

relationships with customers in a country.35 This can be difficult if the trademark owner
delivers goods or services exclusively over the Internet, or, in particular, if the goods or
services are provided for free as in the case of Internet search engines, which have little or
no physical presence outside the Internet.

Given the rapid and continuing development of electronic commerce, it is almost impossible
to give an exhaustive list of ways in which trademarks can be used on the Internet and to
project what new forms of use might raise questions in the future. For the present, some of
these practices, such as “hyperlinking” or “metatagging” are currently indispensable for an
efficient use of the World Wide Web. Nevertheless, they pose potential threats to
trademark owners since they facilitate the creation of associations, thus increasing the
danger of confusion, dilution or other forms of unfair exploitation of trademarks. On the
other hand, the growing familiarity of consumers with Internet technology will probably
influence the legal assessment of such practices. The general problem with such cases is
that each jurisdiction seems to draw the line between acceptable and infringing practices
differently.36 Such differences make it difficult for enterprises to formulate a coherent
marketing strategy for their activities in electronic commerce. The following examples
illustrate this concern:

8.21 USE OF TRADEMARKS AS METATAGS37

A metatag is a keyword embedded in a web site’s HTML code as a means for Internet search
engines to categorize the contents of the web site. Metatags are not visible on the web site
itself (although they can be made visible together with the source code of the page);
however, a search engine seeking out all web sites containing a particular keyword will find
and list that particular site. The more often a keyword appears in the hidden code, the
higher a search engine will rank the site in its search results. In various jurisdictions,
trademark owners have challenged the unauthorized use of their trademark as a metatag.

One problem in such cases is that the trademark is not primarily used to distinguish
particular goods or services. It is used in a way that is normally not visible to the human
eye, to make a search engine list a particular web site in response to a search. The user has

35 This view is supported by the responses to the WIPO Questionnaire “Hypothetical
Cases Concerning the Use of Trademarks on the Internet” to which 36 States replied. The responses
are summarized in “Use of Trademarks on the Internet. Summary of Responses to Questionnaire,”
WIPO document SCT/3/2 (1999). See, in particular, paras.14-15 with regard to maintenance of rights.
See further the factors for establishing a relationship with a particular country listed in WIPO
document SCT/2/9, paras.31-34.
36 This is evidenced by the replies to the WIPO Questionnaire “Hypothetical Cases
Concerning the Use of Trademarks on the Internet”, summarized in WIPO document SCT/3/2,
paras.16-21.
37 See WIPO document SCT/2/9, paras.79-104. See also D. M. Cendali, C. E.
Forssander & R. J. Turiello Jr., “An Overview of Intellectual Property Issues Relating to the Internet,”
89 Trademark Reporter at pp.529-532 (1999); S. Chong, “Internet Meta-tags and Trade Mark Issues,”
E.I.P.R., at pp.275-277 (1998); N. S. Greenfield & L. Cristal, “The Challenge to Trademark Rights by
Web Technologies: Linking Framing, Metatagging and Cyberstuffing,” Trademark Law and the
Internet, at pp.207-216 (1999); T. F. Presson & J. R. Barney, “Trademarks as Metatags: Infringement
or Fair Use?,” AIPLA Quarterly Journal, at pp.147-178 (1998).

158

to click on one of the listed search results if he or she wants to view the content of that web
site itself. Some courts have nevertheless regarded this as a trademark infringement,
stating that such use might suggest sponsorship or authorization by the trademark owner,
or using the concept of “initial interest confusion”38 relying on the fact that consumers
looking for the products of the trademark owner might wrongly be directed to the web site
of someone else. If this is the web site of a competitor, consumers might simply stop there
and use the competing product, even though they are no longer confused when viewing
that web site. In other jurisdictions, such use might be regarded as an act of unfair
competition.39

In other contexts, the use of another’s trademark as a metatag may be legitimate “fair use,”
for example, if a retailer uses a trademark as a metatag to indicate to prospective customers
that it is offering the trademarked goods.40

8.22 “SALE” OF TRADEMARKS AS KEYWORDS

The web sites of Internet search engines are among the most frequented sites on the
Internet. As such, they are particularly attractive to advertisers. Some of these search
engines “sell” keywords to advertisers who want to target their products to a particular
group of Internet users. This results in the outcome that, whenever the keyword is entered
into the search engine, an advertisement appears along with any search results. Retailers,
for example, have purchased keywords so that their advertisements are displayed whenever
it appears that products bearing a particular trademark are being sought. This has been
challenged by trademark owners who are concerned that such advertisements might divert
customers from their own web site, or from the web sites of their preferred or authorized
web retailers. The legal treatment of such cases is, as yet, unclear.41

8.23 ACCEPTABLE UNAUTHORIZED USE

Legal systems may provide exceptions for the “fair use” of a sign that is protected as a
trademark.42 Such exceptions often apply when a sign is used fairly and in good faith in a
purely descriptive or informative manner. It is also often stipulated that such use should not

38 See Brookfield Communications Inc. v. West Coast Entertainment Corp, 50 U.S.P.Q.
2d 1545 (9th Cir. 1999). A similar approach is taken in the recent decision by the Tribunal de grande
instance de Paris (March 24, 1999), Société Kaysersberg Packaging v. Société Kargil, and in the
judgment of the Landgericht Mannheim, 7 O 291/97 (August 1, 1997), involving the trademark
“ARWIS.”
39 See the replies to the WIPO Questionnaire “Hypothetical Cases Concerning the Use
of Trademarks on the Internet”, summarized in WIPO document SCT/3/2, para.17.
40 For “fair use” of a trademark as a metatag see e.g., Playboy v. Enterprises Inc. v.
Welles, 7 F. Supp.2d 1098, 47 U.S.P.Q.2d 1186.
41 See Playboy Enterprises Inc. v. Netscape Communications Corp., C.D. Calif., No. SA
CV 99-320 AHS (Eex) (June 24, 1999), where the court denied preliminary injunctive relief stating that
the Defendant’s sale of “Playboy” and “Playmate” as search terms only involved common words, not
the marks. See also the replies to the WIPO Questionnaire “Hypothetical Cases concerning the Use
of Trademarks on the Internet”, summarized in WIPO document SCT/3/2, para.18, showing a wide
divergence of views.
42 This is explicitly recognized by Article 17 of the TRIPS Agreement.

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extend beyond that which is necessary to identify the person, entity or the goods or
services, and that nothing is done in connection with the sign which might suggest
endorsement or sponsorship by the trademark holder. Such exceptions may be equally
applicable when a sign is used on the Internet.43 Other examples of acceptable
unauthorized trademark use include use in a non-commercial context or use that is
protected by the right of free speech, such as consumer criticism expressed in relation to a
particular trademark.44

Since approaches differ from country to country, international harmonized criteria could
increase predictability in this context, for the benefit of participants in electronic commerce.
It would not be realistic, or for that matter desirable, for such a harmonized approach to
attempt to regulate every new means of using a distinctive sign on the Internet. In order to
be technologically neutral, any attempt might only seek to identify general standards for
distinguishing acceptable from unacceptable practices. In this respect, two different
approaches might be useful: an attempt could be made to develop criteria concerning
unacceptable use, or alternatively, definition could, in a general way, be given to forms of
“fair use” that each country would treat as acceptable in its territory.45

8.24 WELL-KNOWN MARKS

Because of the heightened attention that fame attracts, well-known marks have for a long
time been considered to warrant special protection, over and above that accorded to other,
ordinary marks under intellectual property law.46 That special protection is well established
in the Paris Convention as well as in other regional or international agreements.47 While
there is an international obligation to accord protection to well-known marks, there exists
no established treaty definition of what constitutes such a mark. It is left to the
appreciation of the competent authority in the country where protection is asserted.48

43 See WIPO document SCT/2/9, paras.98 to 101; see also D. M. Kelly & J. M.
Gelchinsky, “Trademarks on the Internet: How Does Fair Use Fare?,” 114 Trademark World, at

pp.19-22 (1999).

44 See e.g., Bally Total Fitness Holding Corp. v. Faber, C.D. Cal., No. CV 98-1278 DDP
(MANx), (December 21, 1998); see also D. M. Cendali, C. E. Forssander & R. J. Turiello Jr., “An
Overview of Intellectual Property Issues Relating to the Internet,” 89 Trademark Reporter,

at pp.543-557 (on issues of free speech, privacy, and defamation) (1999).
45 See “Use of Trademarks on the Internet: Issues Paper,” WIPO document SCT/3/4,

paras.27-31 (1999).

46 See Report of the WIPO Internet Domain Name Process, at para.247 at

http://ecommmerce.wipo.int.

47 The protection of well-known marks in the Paris Convention is provided for in Article

6bis, section (1) of which provides as follows:

“The countries of the Union undertake, ex officio if their legislation so permits, or at the request of an

interested party, to refuse or to cancel the registration, and to prohibit the use, of a trademark which

constitutes a reproduction, an imitation, or a translation, liable to create confusion, of a mark

considered by the competent authority of the country of registration or use to be well known in that

country as being already the mark of a person entitled to the benefits of this Convention and used for

identical or similar goods. These provisions shall also apply when the essential part of the mark

constitutes a reproduction of any such well-known mark or an imitation liable to create confusion
therewith.”

48 While Article 6bis of the Paris Convention is silent on what constitutes a well-known mark,

Article 16.2 of the TRIPS Agreement provides some guidance as to the criteria that such a competent

authority must take into account in forming its assessment:

160

Well-known marks have been the special target of a variety of abusive practices on the
Internet. Moreover, the international dimensions of electronic commerce are bringing
pressure on the current territorially based protection of well-known marks. WIPO through
the SCT has been working to develop provisions on the protection of well-known marks,
which were adopted as a Joint Recommendation by the WIPO General Assembly and the
Paris Union Assembly in September 1999.49 The provisions intend to clarify, consolidate and
supplement the existing international protection of well-known marks, as established by
Article 6bis of the Paris Convention and Articles 16.2 and 16.3 of the TRIPS Agreement. In
particular, the Joint Recommendations in Article 2 contain a list of factors that may be used
by a competent authority to determine whether a mark is well-known in its territory.50
While the Joint Recommendation does not have the force and effect of a treaty, Member
States may consider the use of any of these provisions as guidelines for the protection of
well-known marks.

Article 6 of the Joint Recommendation expressly addresses conflicts between well-known
marks and domain names. According to this provision, a domain name shall be deemed to
be in conflict with a well-known mark at least where that domain name, or an essential part
thereof, constitutes a reproduction, an imitation, a translation or a transliteration of the
well-known mark, and the domain name has been used or registered in “bad faith.” It is
understood that “bad faith” will include the cases that are currently known as
“cybersquatting,” that is, the registration of a well-known mark as a domain name, with the
intention of selling it to the trademark owner. In this regard, WIPO, in the
recommendations in the Report of the WIPO Internet Domain Name Process (discussed
below), developed a definition of an abusive, bad faith registration of a domain name.51

“Article 6bis of the Paris Convention (1967) shall apply, mutatis mutandis, to services. In determining
whether a trademark is well-known, Members shall take account of the knowledge of the trademark in
the relevant sector of the public, including knowledge in the Member concerned which has been
obtained as a result of the promotion of the trademark.”
For discussion of international and national protection of well-known marks, see F. W. Mostert,
“Famous and Well-Known Marks,” (1997).
49 See “Joint Recommendation Concerning Provisions on the Protection of Well-Known
Marks,” Standing Committee on the Law of Trademarks, Industrial Designs and Geographical
Indications, WIPO document SCT/3/8 (October 1999).
50 See id., Article 2. (Determination of Whether a Mark is a Well-Known Mark in a Member
State).
51 The Report of the WIPO Internet Domain Name Process provides that registration of a
domain name shall be considered to be abusive when all of the following conditions are met:
(i) the domain name is identical or misleadingly similar to a trade or service mark in which the
complainant has rights; and

(ii) the holder of the domain name has no rights or legitimate interests in respect of the
domain name; and

(iii) the domain name has been registered and is used in bad faith.
For the purposes of paragraph (iii), the following, in particular, may be evidence of the registration and
use of a domain name in bad faith:

(a) an offer to sell, rent or otherwise transfer the domain name to the owner of the trade
or service mark, or to a competitor of the owner of the trade or service mark, for valuable
consideration; or

(b) an attempt to attract, for financial gain, Internet users to the domain name holder’s
web site or other on-line location, by creating confusion with the trade or service mark of the
complainant; or

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8.25 UNFAIR COMPETITION

Commerce means competition, and where there is competition, acts of unfair competition
are liable to occur. Electronic commerce is no exception. This new channel of commerce
has, for some time, been regarded as a “wild west”, where almost anything can and does
happen. Electronic commerce will realize its potential, however, only if some scope of
protection and recourse against acts of unfair competition is provided. Protection against
unfair competition supplements the protection of intellectual property rights. Without such
protection, companies are likely to gauge the risks of damage to their reputations, loss of
customers and liability from engaging in electronic commerce, with the threatened
consequence that innovation and freedom of competition is stifled.

Whereas issues concerning trademarks and the Internet have been at the forefront of
discussions, questions relating to acts of unfair competition have attracted much less
attention. Protection against unfair competition, however, covers an even broader scope of
issues relevant for electronic commerce. It provides a legal framework for all forms of
marketing, and it supplements the protection of intellectual property through statutory
rights. So far, electronic commerce has not been subject to specific regulations dealing with
matters of unfair competition. National or regional laws apply together with international
provisions contained in the Paris Convention52 and the TRIPS Agreement.53 The application
of these rules to electronic commerce, however, poses a number of problems.

Because marketing activities on the Internet may be subjected to a variety of often
contradicting legal systems, the development of marketing strategies in electronic
commerce becomes more difficult. What is allowed in one country may be forbidden or
strictly regulated in another. Even though Article 10bis of the Paris Convention and
Article 39 of the TRIPS Agreement give some guidance as to the internationally applicable
rules for the protection against unfair competition, there remain many areas which are
regulated differently in various national legal systems. For example, comparative
advertising and bonus or discount schemes are forbidden in some countries, generally
allowed in others, and more or less strictly regulated in still other countries. Such regulatory
differences affect the free circulation of goods or services in electronic commerce.

Experience has already shown that enterprises cannot simply continue their habitual
marketing efforts in cyberspace. They have to adapt to and use the particular technical

(c) the registration of the domain name in order to prevent the owner of the trade or
service mark from reflecting the mark in a corresponding domain name, provided that a pattern of
such conduct has been established on the part of the domain name holder; or

(d) the registration and use of the domain name in order to disrupt the business of a
competitor.
Report of WIPO Internet Domain Name Process, at para.171 (1999), at http://ecommerce.wipo.int.
52 In particular, Article 10bis of the Paris Convention provides that States party to the
Treaty must provide effective protection against unfair competition. Any act of competition contrary to
honest practices in industrial or commercial matters constitutes an act of unfair competition, and in
particular “all acts of such a nature as to create confusion by any means whatever with the
establishment, the goods, or the industrial or commercial activities, of a competitor.”
53 Article 39 of the TRIPS Agreement relies on the obligation to provide protection
against unfair competition in Article 10bis of the Paris Convention as a basis for extending protection
to “undisclosed information,” also known under various national laws as trade secrets.

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features of the Internet, such as its interactivity and support of multimedia applications. As
the most flexible part of industrial property law, unfair competition law may offer solutions
to of the new problems that have arisen in electronic commerce.54

Nevertheless, problems may arise with regard to the following issues:

(i) Interactive marketing practices. Because electronic commerce relies on interactive
contacts with prospective customers, attracting their attention is a core issue. Online
marketing often uses strong incentives such as lotteries, free gifts or rebates, and tends
towards more aggressive practices, such as comparative advertising or unsolicited e-mails
(i.e. often referred to as “spamming”). With the broadband technologies that will become
available in the next few years, new forms of “immersive” marketing may also become
prevalent.55 Under a number of legal systems, such inducements may be considered
contrary to honest trade practices. Should the standard for establishing unfair practices in
electronic commerce take the specific nature of the medium into account? Given the
medium’s compelling interactivity, should more stringent standards be considered?

(ii) Transparency and privacy concerns. In an interactive medium like the Internet, the
safeguarding of transparency and privacy is of particular importance. Unfair competition
law may have to include rules requiring a clear distinction between informative text and
advertising, and protecting consumers against the unauthorized collection of data for
commercial purposes. Another related problem that may have to be addressed, noted
above, is the flooding of users with unsolicited advertising (“spamming”).

(iii) National versus international standards of “unfair” marketing practices: Whether a
particular statement is misleading will usually be determined with regard to the public to
which it is addressed. But marketing practices in electronic commerce are often directed at
a public in more than one country. What can be misunderstood in one country might be
perfectly clear in another. Should marketing in electronic commerce be required to take
into account the level of knowledge or the understanding of the audience in every country
where the message can be received, or at least in every country foreseeably affected by it?
Or should it be enough for an advertiser to show that a statement was not liable to be
misunderstood in a “home country”?

(iv) Trade secrets. The protection of trade secrets is in many countries covered by unfair
competition law. The protection of trade secrets in a network environment relies heavily on
technological measures for information security, especially because after a trade secret has
been stolen and posted on the Internet; courts sometimes experience difficulty finding the
“secrecy” element of a trade secret. Secrecy issues are therefore of particular importance in
electronic commerce.

8.26 DOMAIN NAMES

54 See the responses to the WIPO Questionnaire “Hypothetical Cases Concerning the
Use of Trademarks on the Internet”, summarized in WIPO document SCT/3/2, paras.16-21; a majority
of responses considered Internet-specific forms of trademark use, such as metatagging, sale of
keywords, as acts of unfair competition.
55 See M. Hardie, “Hooked on Broadband,” The Forrester Report (July 1999), at
http://www.forrester.com.

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Domain names are a simple form of Internet address, designed to serve the function of
enabling users to locate sites on the Internet in an easy manner.56 Domain names may be
registered in spaces known as “generic top-level domains” (gTLDs), such as .com, .org or
.net, or in the “country code top-level domains” (ccTLDs), such as .ch (Switzerland), .fr
(France) or .za (South Africa).

Precisely because domain names are easy to remember and use, the domain name system
(DNS) – the central system for routing traffic on the Internet – has assumed a key role in
electronic commerce. On the one hand, it facilitates the ability of consumers to navigate
the Internet to find the web sites they are looking for, and, on the other hand, it facilitates
businesses’ ability to promote an easy-to-remember name or word which may, at the same
time, serve to identify and distinguish the business itself (or its goods or services) and to
specify its corresponding online, Internet location.

As commercial activities on the Internet have increased, domain names have acquired
increasing significance as business identifiers and, as such, have come into conflict with the
system of business identifiers that existed before the arrival of the Internet and that are
protected by intellectual property rights, namely, trademarks and other rights of business
identification, geographical indications and the developing field of personality rights. The
tension between domain names and intellectual property rights has led to numerous
problems that raise challenging policy questions. One system—the DNS—is largely privately
administered and gives rise to registrations that result in a global presence, accessible from
anywhere in the world. The other system—the intellectual property rights system—is
publicly administered on a territorial basis and gives rise to rights that are exercisable only
within the territory concerned.

The tension that exists between the two systems has been exacerbated by a number of
predatory and parasitical practices that have been adopted by some parties to exploit the
lack of connection between the purposes for which the DNS was designed and those for
which intellectual protection exists. These practices include the deliberate, bad faith
registration as domain names of well-known and other trademarks in the hope of being able
to sell the domain names to the owners of those marks, or simply to take unfair advantage
of the reputation attached to those marks.

8.27 EMERGING RESPONSES: TOWARDS A SOLUTION

The Internet may be less of a threat to the rights of intellectual property holders than it is to
the means by which intellectual property has been traditionally managed in the physical
world. What is required in the age of the Internet are new methods for the creation,
exploitation and enforcement of intellectual property that are suited to the nature of the

56 A domain name is the alphanumeric address of a computer, such as www.wipo.int. A domain
name allows a user to locate a computer site on the Internet without the need to resort to the unique
underlying numeric address, known as the Internet Protocol (IP) address (e.g., 192.91.247.53).
Distributed databases on the Internet contain the lists of domain names and their corresponding IP
addresses and perform the function of mapping the domain names to their IP addresses for the
purpose of directing requests to connect computers on the Internet. The DNS is structured in a
hierarchical manner that allows for the decentralized administration of this name-to-address mapping.

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medium. Today, there may not be a single, easy answer to this challenge. Yet
commentators have suggested that we should be wary of solutions that risk conditioning
future technological possibilities and, thus, stifling, rather than facilitating, their future
development. Various measures aimed at facilitating enforcement are now being
developed, and several are discussed below.

8.28 TECHNOLOGICAL MEASURES OF PROTECTION

The enforcement difficulties associated with digital data and global networks are leading to
widespread recognition that enforcement is best achieved not only through legal means,
but also through technological measures of protection.57 These mechanisms are now
becoming available on the market and have received legal recognition.

The techniques under the current state of the technology – such as encryption and
watermarking – are intended to permit rights holders to control access and manipulation of
their works, and to track them on the Internet.58 Encryption allows content to be
transmitted through the Internet in a scrambled, illegible format, which can only be
decoded by means of a decryption key, the receipt of which may be conditioned upon
payment to gain access to the work.59 Watermarking consists of embedding in a work and
its legitimate copies, data that permits the identification of rights holders. The same
technique can also be used to prevent a work from being modified (e.g., removing the
watermark), because any tampering can be made to result in a visible or audible
rearrangement of the data.

8.29 TECHNOLOGIES TO ASSIST IN RIGHTS MANAGEMENT

Other technologies allow works to be licensed online, eliminating many of the transaction
costs involved in traditional forms of licensing. These techniques can be highly
sophisticated, differentiating among different types of uses, for example, allowing a user to
perceive the work but not copy it, or copy but not further transmit it. The would-be user
need not expend time and energy searching for information, sending letters and awaiting
responses. Rather, all information could be easily available online, including different terms
and conditions for different types of uses, with the option of an immediate keystroke
response. These technologies together should encourage right holders to provide high-
quality, user-friendly and legitimate material.

57 This point is underscored by the fact that the recording industry has placed Leonardo Chiariglione,
a technology expert who helped create the MP3 standard, in charge of the Secure Digital Music
Initiative (SDMI). “MP3” is a technology that allows music to be easily compressed in digital form so
that it can be readily uploaded onto a computer or a network, but it is not a “secure” technology, i.e.,
whatever is copied in this format can be easily re-copied and distributed. The goal of the SDMI
project is to create a technical format for the secure sale and delivery of copyrighted music over the
Internet. For more information on MP3 and the problems it has created for the music industry, as well
as the SDMI, see the web site of the Recording Industry Association of America at
http://www.riaa.com.
58 For an overview of the technology, see Peter Wayner, “Digital Copyright Protection” (1997).
59 For discussion of cryptography technologies, see Annex II (Technology of Digital Systems for
Security and Authentication of Intellectual Property Services); see also presentation of S. Baker,
Partner, Steptoe & Johnson, WIPO International Conference on Electronic Commerce and Intellectual
Property (September 1999), at http://ecommerce.wipo.int/meetings/1999/index.html.

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These tools, particularly if they are deployed in the framework of electronic copyright
management systems (ECMS),60 have the potential to contribute significantly to the
enforcement of intellectual property rights on the Internet. They also raise several
questions, however, including whether the market will embrace these tools so that they
become commercially viable; the extent to which common standards and interoperability
are useful or necessary on an international basis; how they will influence the collective
administration of rights as currently performed by collecting societies; and the degree to
which their tracking and control features are compatible with concerns of privacy.61

8.30 ALTERNATIVE DISPUTE RESOLUTION PROCEDURES

Putting a stop to harmful activity on a global and fast-moving medium such as the Internet
through judicial enforcement mechanisms that are territorial might increasingly prove to be
a challenging task. To supplement available court procedures, alternative dispute-
resolution (ADR) procedures may usefully be employed to provide rights owners with
procedures for fast and effective remedial action, reflective of the ease with which
intellectual property infringements can occur on the Internet.

ADR procedures offer a solution of international dimension for the jurisdictional concerns
raised above. Arbitration is a procedure providing a private and binding adjudication, which
operates within a well-established and publicly enforceable international legal framework.62
Arbitration can provide a single solution for multi-jurisdictional disputes arising from
commerce over global networks. At the same time, the nature and speed of electronic
commercial activities have generated pressure to streamline and reduce the time and cost
of traditional arbitral procedures.

On-line dispute-resolution procedures may serve to enhance access to dispute settlement
mechanisms, while increasing the speed and efficiency with which the proceedings are
conducted and reducing the corresponding costs. Many parties involved in disputes arising
from commerce over the Internet may not have had significant exposure to legal
proceedings and the attendant formalities. Enabling them to initiate or to defend a claim by
accessing a web site and completing electronic forms guiding them through the various
stages of the process is expected to reduce entry barriers to any available procedures.
Furthermore, Internet-based document filing systems may allow parties to submit
instantaneously a significant number of documents over any distance, at virtually no cost.
Submissions can be processed, stored and archived by automated document management
systems, and their review from any location will be possible through an Internet-based

60 ECMS are technological systems permitting the online management, exploitation and enforcement
of copyright.
61 ECMS, and the digital technologies on which they are based, enable the collection of very large
records of “who reads what, who listens to what or who watches which movie… The full effects of
such a widespread system for monitoring artistic consumption are not known….” Peter Wayner,
“Digital Copyright Protection,” at p.7 (1997). For a comprehensive study on the privacy implications of
ECMS, see “Privacy, Data Protection and Copyright: Their Interaction in the Context of Electronic
Copyright Management Systems,” Institute for Information Law, Faculty of Law, University of
Amsterdam (1998).
62 See New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1959),
at http://www.uncitral.org/en-index.htm.

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interface on a 24-hour basis for parties with the required access rights. With the
development of appropriate audio and video facilities, parties will also have the possibility
of conducting meetings or hearings online, greatly reducing travel expenses and the costs of
organizing conference rooms.

Next to the establishment of a technical system allowing the proceedings to be conducted
online, the required legal framework needs to be established. Existing arbitration rules can
provide a foundation for any adaptations to the online environment that may be required.
Issues that need to be addressed in particular are rights of access to the documents by the
parties, applicable procedures in case of challenges of authenticity, contact details for
notification purposes, calculation of time periods (in view of likely time-zone differences
between the locations from which the parties are operating), and writing and signing
requirements for dispute clauses, party communications and awards. In addition, the time
periods for the accomplishment of various steps in the procedure can be shortened to
ensure that the proceedings can be conducted swiftly and, consequently, at lower cost.63

8.31 DIRECT ENFORCEMENT

Another approach to improving the enforcement situation is the development of legislative
frameworks or administrative systems providing for direct enforcement by the entities that
provide technical services for accessing the Internet (e.g., online service providers or domain
name registration authorities). To date, two such approaches have received widespread
attention: the notice and take-down provisions of the United States Digital Millennium
Copyright Act of 1998 and the administrative domain name dispute-resolution system
recommended in the WIPO Internet Domain Name Process and now implemented by
ICANN.

In the framework of the Internet Domain Name Process, WIPO recommended
administrative dispute-resolution procedures aimed at the efficient resolution of multi-
jurisdictional domain name disputes. A critical feature of this scheme is the direct
enforcement by domain name registration authorities of the decisions issued by
administrative panels. An additional key characteristic is that, unlike a nationally-based
response, the dispute settlement procedures recommended by WIPO apply on an
international basis, at least in so far as the Internet generic top-level domains (gTLDs) are
concerned. This dispute-resolution system is based on contract and self-regulation and, as
such, tests the limits of what can be achieved in the furtherance of enforcement goals in the
absence of enabling legislation at the national or international levels.

An example of prospective legislation enabling alternative dispute resolution for disputes
between service providers and users is found in Article 17 of the European Commission’s
Proposal for a European Parliament and Council Directive on Certain Legal Aspects of
Electronic Commerce in the Internal Market, which provides in relevant part that:

63 WIPO has developed an online system for administering disputes in electronic commerce involving
intellectual property.

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“Member States shall ensure that, in the event of disagreement between an Information
Society service provider and its recipient, their legislation allows the effective use of out-of-
court schemes for dispute settlement, including appropriate electronic means.”64

The Commentary to the Proposal states that “[t]his type of mechanism would appear
particularly useful for some disputes on the Internet because of their low transactional
value and the size of the parties, who might otherwise be deterred from using legal
procedures because of their low cost. The legal framework of these dispute-settlement
mechanisms in the Member States should not be such that it limits the use of these
mechanisms or makes them unduly complicated. For example, in the case of specific
mechanisms for disputes on the Internet, these could take place electronically.”

8.32 THE INDIAN PERSPECTIVE ON DOMAIN NAMES AND OTHER ‘SIGNS’

The Web is a territory where caveat emptor is the rule and, as a result, consumers
increasingly rely upon strong brand awareness and brand performance for the confidence to
engage in e-commerce.65 While trademarks are of greater importance in this virtual
environment, they are also more vulnerable to infringement, dilution and anti-competitive
practices. Trademark owners expend vast resources, engaging automated ‘web crawling’
software and cyber surveillance firms, to monitor the billions of Web pages and protect
their intellectual property rights.

Identity on the Internet also goes beyond the trademark system, because of the role played
by the Internet domain name system, which facilitates users’ ability to navigate on the
network. Domain names are user-friendly addresses that correspond to the unique Internet
Protocol numbers that connect our computers to the Internet and enable the network
routing system to direct data requests to the correct addressee. Domain names were
originally intended to perform a purely technical function in a user-friendly way, but
because they are intuitive and easy to remember they now perform a function as business
or personal identifiers. Most businesses, whether e-commercial or not, advertise their
domain name to signal a Web presence. In this way, although, as such, not a form of
intellectual property, domain names now perform an identifying function similar to that of a
trademark. Because of the way in which people and search engines operate, most
businesses use their trademark or trade name as their domain name, and this has caused
conflict with the advent of predatory practices, known as ‘cybersquatting.’

8.33 DOMAIN NAME DISPUTES AND THE INDIAN COURTS

In Yahoo, Inc. v. Akash Arora66 the defendant, who was running a business similar to the
plaintiff, was restrained from using the domain name ‘yahooindia.com’ which had the format,
content and colour scheme identical to the plaintiff’s ‘yahoo.com’. Extending the benefit of

64 See id., Article 17.1.
65 See Laura Rush, “Top E-Commerce Companies Analyzed,” Internet.com, (July 30, 2002) at
http://ecommerce.internet.com; and Robin D. Rusch “Apple Shines: 2001 Brand of the Year
Results,” Brandchannel.com (March 4, 2002) at
http://www.brandchannel.com/features_effect.asp?id=82#more.
66 1999 PTC (19) 201. Decided on February 19, 1999 by Dr. M.K. Sharma, Judge at High Court of
Delhi, India. First Indian decision on Internet domain names.

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passing off action to cases where the business was rendering ‘services’ through internet domain
names, the Court while enjoining the defendant from using the disputed domain observed that
‘Yahoo’ has acquired distinctiveness with respect to the plaintiff’s business so the fact of its
being a dictionary word is inconsequential.

In Rediff Communications Ltd. v. Cyberbooth67, the defendant had adopted the domain name
‘www.radiff.com’ despite the existence of the plaintiff’s well-known web-site ‘www.rediff.com’.
The Court granted interim injunction against the defendant and held that in cases where
malafide intent to cause deception is established, any further inquiry on likelihood of confusion
would be unnecessary. Court apparently relied upon the assumption that ‘Internet users may be
unsophisticated consumer of information’ formulated in the above-mentioned Yahoo case.

Indian Courts clarified their position with regard to generic domain names in Online India
Capital Co. Pvt. Ltd. & Another v. Dimension Corporate68 where the competing domain names
were ‘www.mutualfundindia.com’ and ‘www.mutualfundsindia.com’ with a slight difference of
a ‘s’. The Court while dismissing the plaintiff's claim held that attainment of a secondary
meaning by the generic domain name is a pre-condition for granting protection to it as no one
can claim monopoly over a generic word otherwise.

In Tata Sons Limited v. Manu Kosuri & Ors.69 plaintiff’s trademark TATA was registered by the
defendant in many variations e.g. jrdtata.com, ratantata.com, tatapowerco.com etc. While
upholding the passing off action, the Court restrained defendant from using any domain name
relating to TATA and observed that domain names are entitled to equal protection as a
trademark as they are more than a mere internet address.

Similarly in Dr. Reddy’s Laboratories Limited v. Manu Kosuri70 the plaintiff, which was a
pharmaceutical MNC had a registered trademark/domain name ‘DR REDDYS’ after the personal
name of the founder and had acquired distinctiveness/secondary meaning. Holding the
defendant to be a cybersquatter the Court restrained him from using the domain name
‘drreddyslab.com’ as otherwise it could cause confusion and deception to the Internet users.

In Info Edge (India) Pvt. Ltd. & Another v. Shailesh Gupta & Another71 the defendant was
restrained from using domain name ‘naukari.com’ (having a hyperlink which connected the user
to their other site ‘jobsourceindia.com’) which was deceptively similar to plaintiff’s
‘naukari.com’ which enabled users to look for jobs. While appreciating evidence (which proved
the acquirement) of a secondary meaning by the plaintiff’s domain name; the Court dismissed
the ‘descriptive term’ argument and also imputed malafide intention on part of defendant in
providing the said hyperlink.

67 2000 PTC 209.Decided on April 22 & 23, 1999 by A. P. Shah, Judge at High Court of Bombay,
India.
68 2000 PTC 396. Decided in May, 2000 by K S. Gupta, Judge at High Court of Delhi, India.
69 2001 PTC 432 (Del). Decided on March 9, 2001 by Mukul Mudgal, Judge at High Court of Delhi,
India.
70 2001 PTC 859 (Del). Decided on February 28, 2001 by N.G.Nandi, Judge at High Court of Delhi,
India.
71 2002 (24) PTC 355 (Del). Decided by M. Sharma, Judge at High Court of Delhi, India.

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Then importing elements and requirements of claim from UDRP in Manish Vij and Others v.
Indra Chugh and Others72 the Court held that the registration of the domain name
‘kabaribazaar.com’ by the defendant was in bad faith and confusingly similar to the plaintiff’s
‘kabadibazaar.com’ which should be entitled to protection on account of its attainment of
secondary meaning.

In NIIT Limited v. Thoota Murali and Anr.73 the plaintiffs, NIIT Ltd., alleged that the defendants
were infringing their rights by registering the domain names NIITePortal.com, NIITeService.com,
NIITeService.net, NIITeService.org, NIITeMart.com and NIITeMart.net which were identical to
their well-known trademark mark NIIT which was an invented word. After satisfying itself that
NIIT had acquired distinctiveness the Court granted ex-parte restraint against the defendants.

Following the above pronouncement, in Tata Sons v. Ghassan Yacoub & Ors.74 the defendants
were restrained from using the domain name ‘tatagroup.com’ or any other domain name
containing the word TATA or mark which was identical or deceptively similar to the plaintiff’s
trademark TATA and from doing anything would likely to lead to an action for passing off, of the
business and goods of the defendants.

8.34 DISPUTE RESOLUTION AND THE UDRP

In Bennett Coleman & Co. Ltd v. Steven S. Lalwani75 and Bennett Coleman & Co. Ltd v. Long
Distance Telephone Company76 the respondent registered the domain names
‘theeconomictimes.com’ & ‘thetimesofindia.com’ respectively which were identical to plaintiff’s
domain names ‘economictimes.com’ & ‘timesofindia.com’ used by him for electronic
publication of their leading newspapers ‘The Economic Times’ & ‘The Times of India’
respectively. The domain names in contention redirected Internet users to the respondent's
web-site ‘indiaheadlines.com’ which provided India-related news. The WIPO panel confirmed
satisfaction of all elements contained in Para 4(a) of UDRP and ordered transfer of impugned
domain names to complainant.

In Tata Sons Ltd v. The Advanced Information Technology Association77 the complainant, an
Indian MNC owned the well-known trademark TATA (a rare surname) which was registered by
the Indian respondent as ‘tata.org’. The panel found that the respondent had kept the web-site
inactive and had not furnished explanation for adoption of the said word and therefore he
should transfer the domain to the complainant as all the three elements of claim under para
4(a) of UDRP are fulfilled.

72 2002 (24) PTC 561 (Del). Decided on January, 29, 2002 by S.K.Aggarwal, Judge High Court of
Delhi, India.
73 Suit No. ----of 1999,Order delivered on December 22, 1999 by Manmohan Sarin, Judge at High
Court of Delhi.
74 Suit No. ----of 1999, Order delivered on August 3, 1999 by Mukul Mudgal, Judge at High Court of
Delhi.
75 Case No. D2000-0014, Adm. Panel Decision, WIPO Arb. and Med. Centre.
76 Case No. D2000-0015, Adm. Panel Decision, WIPO Arb. and Med. Centre.
77 2001 PTC 129 (WIPO). Adm. Panel Decision Case No. D2000-0049 decided on April 6, 2000.

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In Microsoft Corporation v. Amit Mehrotra78 the WIPO panel found that the domain name
‘microsoft.org’ registered by respondent was identical and confusingly similar to the trademark
‘MICROSOFT’( in which the complainant had rights and respondent had no legitimate interest)
and that the respondent’s domain name had been registered and was being used in bad faith.

In Mahindra & Mahindra Limited v. Neoplanet Solutions79 the Complainant was a well-
known manufacturer and exporter of tractors and utility vehicles under the trademark
'Mahindra' which, at least in relation to motor vehicles, was associated exclusively with the
Complainant. The Panelist concluded that the respondent’s domain name “mahindra.com”
be transferred to the complainant as it was identical to the trademark of the Complainant in
which the respondent had no legitimate interests and had been registered in bad faith.

In NIIT Ltd. v. Parthasarathy Venkatram80 the Complainant was engaged in the business of
imparting education in Information Technology under the trademark “NIIT” which was a
coined mark and had no obvious meaning and had developed computer software with
names such as NIITePortal, NIITeMart and NIITeService, etc. The Panel found that the
respondent’s inactive domain name “myniit.com” was confusingly similar to that of
Complainant’s and that the respondent’s domain name had been registered in bad faith.
Accordingly the Panel required that the registration of the domain name “myniit.com” be
transferred to the Complainant.

In Funskool (India) Ltd v. funschool.com Corporation81 the Indian complainant having
registered domain ‘funskool.com’ established identical and confusingly similar nature of the
American respondent’s domain ‘funschool.com’ but failed to prove other two elements of claim
provided under Para 4(a) of UDRP i.e. bad faith intent and no legitimate right of the respondent
in the domain name. Considering the prior bona fide use of the domain by the respondent and
the limited extent of complainant’s trademark rights, the panel (2:1) refused to accept the
complainant’s request for transferring respondent’s domain name to him.82

In Vishwa Nirmala Dharma a.k.a. sahajayoga v. Sahaja Yoga Ex-members Network and SD83
the panel dismissed the claim of complainant Sahajyoga (an organization teaching methods of
meditation) that respondent’s (ex-members of the organization) domain name <sahaja-
yoga.org> is passing-off his domain name <sahajayoga.org> on the strength of its finding that
the respondent were exercising their ‘right to speech and expression’ in good faith by extending
free services and that sahajayoga was a descriptive word in Sanskrit referring to a spiritual
movement on which exclusivity could not be claimed by anybody.

78 Case No. D2000-0053, Adm. Panel Decision, WIPO Arb. and Med. Centre.
79 Case No. D2000–0248.
80 Case No. D2000-0497.
81 2001 PTC 911 (WIPO). Adm. Panel Decision Case No. D2000-0796 decided on November 30,
2000.
82 Mr. Maninder Singh, Panelist, gave dissenting decision by imputing bad faith intent on part of
respondent by relying on the fact that respondent had registered two domain names i.e.
‘funschool.com’ and ‘funskool.com’ and had created a hyperlink between the two. The Panelist
observed that the concept of different territories which is well accepted in the law governing trade
marks registrations is completely unknown and incompatible in the case of registration of domain
names and it is unnecessary for the complainant to establish that his services are provided all over
the world.
83 2002 (24) PTC 257 (WIPO). Case No. D2001-0467, Adm. Panel Decision.

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In Ushodaya Enterprises Private Ltd. v. Surendra Reddy84 the complainant Ushodaya (part
of the Eenadu Group which published the Telugu daily newspaper Eenadu (meaning "daily"
in Sanskrit) with an Internet edition) alleged that the respondent company (which aimed at
providing on line business to business activities primarily for the US market) had passively
held the domain name <eenadu.com> with no actual use of the word 'eenadu'. The panel
dismissed the complaint as 'eenadu' was a generic word which could not be monopolized by
the complainant and the unregistered mark had not acquired secondary meaning.

In ITC limited v. Buy This Name85 the complainant, trading under the coined service mark
ITC, had registered several domain names in which ITC formed a leading and distinctive part,
such as; <itcportal.com> <itccorporate.com> <itcibd.com> <itcsra.org> <itcbpl.com>
<itcppd.com> <itcinfotech.com>. The respondent's domain name "itc threadneedle" was
held to be confusingly similar to the Complainant’s ITC Threadneedle trademark and a bad
faith registration and the respondent was thereby ordered to transfer it to the complainant.

In IIT Bombay, Powai, v Indsoft86 the Domain Name in dispute was <iitpowai.com>
registered with the respondent which was confusingly identical to the complainant's
distinctive service mark IIT which had gained immense goodwill and reputation for its
superb academic education. The Panel decided that the Respondent should transfer the
domain as he had no rights or legitimate interests in respect of the said domain and because
it had been registered and was being used in bad faith.

In Castrol Limited v. Shriniwas Ganediwal87 the complainant (involved in production and
distribution of automotive lubricants) who held rights in the registered trade-mark CASTROL
in India and around the world and operated the web site www.castrol.com alleged that the
respondent's domain name <castrolindia.com>, which included the term "castrol" was
confusingly similar to its trade-mark. The Panel concluded that the respondent had no
legitimate interest in the confusingly similar disputed domain name which had been
registered in bad faith and ordered that the domain be transferred to complainant

Microsoft Corporation v. Deepak Chandwani & Anr., the defendant, a Delhi based Computer
and networking company, had without permission, registered the ‘famous’ trademark
‘MICROSOFT’ as a part of a domain name ‘Microsoftindia.com’ and also used the same as a
trademark on its website. The Delhi HC restrained the defendant from using the domain name
microsoftindia.com and also from transferring its rights to the third parties.

84 Case No. D2002-0003.
85 Case No. D2002-0007.
86 Case No. D2002-0078.
87 Case No: D2002-0881.

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