Domain Name Trademarks: What You Need To Know To Protect Yourself

If you buy a domain name that contains words that are trademarked, you risk losing your financial investment in the domain name, as well as legal fees and your time dealing with a potential legal issue. Understand and learn how to minimize your risk.

Trademark Domain NamesIf you are considering buying a domain name, you need to consider the trademark aspects in your due diligence process. Why? Because you could be spending a great deal of money acquiring a domain name and even more time and money developing a website or business using the domain name, only to find it all come crashing down in two months if someone files a legal case against you.

Take, for example, the domain name cragslist.com. No, not craigslist.com, it’s cragslist.com (missing the “i” after the “a”). In May 2011, cragslist.com sold on NameJet.com for $17,000, according to Mike Berkens. For $1,500, Craigslist, Inc. can file a UDRP case. Administrative proceedings under the UDRP generally progress faster than a regular court lawsuit. A decision is typically rendered in about two months, and the onus is on the registrant to present a convincing argument as to why this domain name is not a typographic error for craigslist.com.

Notice: DomainSherpa is not providing legal advice.


What Is a Trademark


According to the United States Patent and Trademark Office (USPTO), “a trademark is a word, phrase, symbol or design, or a combination of words, phrases, symbols or designs, that identifies and distinguishes the source of the goods of one party from those of others.” Similar trademark offices exist in other countries, so if you do not reside or conduct commerce primarily in the United States, you should research trademark usage in your desired country.


What Rights Does a Trademark Provide


When you obtain a trademark in the United States, you establish a legal claim and establish stronger rights than someone whose name or mark has not been registered. By doing so, you obtain several advantages, including:

  • Public notice of your claim of ownership of the mark;
  • A legal presumption of your ownership of the mark and your exclusive right to use the mark nationwide on or in connection with the goods/services listed in the registration;
  • The ability to bring an action concerning the mark in federal court;
  • The use of the U.S. registration as a basis to obtain registration in foreign countries;
  • The ability to record the U.S. registration with the U.S. Customs and Border Protection (CBP) Service to prevent importation of infringing foreign goods;
  • The right to use the federal registration symbol ®, and
  • Listing in the United States Patent and Trademark Office’s online databases

Why Does Buying Trademarked Domain Names Matter


When companies build and shape their brand, they do so through years of market research, product or service development, corporate branding, marketing, and relationship building (often called “goodwill”). A company’s ability to inspire confidence in customers and customer loyalty takes years of effort. They also register trademarks to protect their claim of ownership.

When another company does anything to potentially reduce the value of a company’s brand, it makes business sense to quickly deal with the situation. In most cases, this involves legal action. This may mean one of a few things:

  • Cease and desist letter from the company to you to stop using a trademark infringing domain name
  • A Uniform Domain-Name Dispute-Resolution Policy (UDRP) case filed against the domain name registrant
  • A lawsuit filed in any district in the United States, which may include punitive damages

The Anti-Cybersquatting Consumer Protection Act (ACPA) is a powerful statute that Congress added to the Lanham Act in 1999 giving trademark owners the power to obtain injunctions, seizure orders, damages and attorney’s fees against trademark counterfeiters.

UDRP is another option to adjudicate cybersquatting claims. When you register a domain name, within the registrar’s terms and conditions you agree to arbitrate any dispute through the UDRP. Any UDRP decision can be appealed by an ACPA action.

Lawsuits and UDRP cases are filed almost every day, and they will only continue to grow in frequency in the future, as they have from 2009-2010 (+25%).


Think it Won’t Happen to You? Think Again



How to Conduct a Trademark Search


To protect your financial investment, be sure to conduct a trademark search BEFORE you purchase any domain name. Performing this search is well worth the effort and, as you will see below, is not very difficult to perform. Remember: failure to perform a comprehensive trademark search before using a domain name is evidence of deliberate infringement on another’s trademark, as ignorance is no excuse in a court of law. Again, consult with an attorney.

When conducting a trademark search, there are three areas that you should investigate:

  1. The United States federal trademark register
  2. State trademark registrations, such as the Indiana Secretary of State’s trademark database
  3. Common-law trademark registration (consult an attorney)

While this process can take significant time, you can outsource the research to a trademark search firm. This reduces your time commitment, but comes with a cost: usually between $150 to $1,000 per domain name. This can eat into any profits you may have estimated from the purchase-sale of a domain name, however, if you are planning to build a long-term company on this domain name – or the domain name purchase cost is in the five or six figures – it may be well worth the cost.

At a minimum, you should conduct a search of the USPTO website, TESS. The Trademark Electronic Search System (TESS) contains the records of active and inactive trademark registrations and applications.


Steps to Conduct a U.S. Federal Trademark Search


Step 1: Visit TESS

Step 2: Click the “Basic Word Mark Search (New User)” link

USPTO Trademark Search Using TESS for Searching Domain Names

Step 3: Enter Search Term and Submit Query

USPTO Trademark Enter Search Term for Domain Name

Step 4: Review Results
If there are no federally registered trademarks, you will see an image like this:

USPTO Trademark Results Search Domain Names

When results are returned, you should consider whether the trademarks are active (“live”) or expired (“dead”), and whether your intended use of the domain name conflicts with the SIC code (classification of a business according to industry as defined by the US Department of Commerce) of any active trademarks, as trademarks only apply to the SIC codes for which they are registered.

When in doubt, consult with an intellectual property attorney specializing in domain names.

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14 Responses to “Domain Name Trademarks: What You Need To Know To Protect Yourself”

  1. excellent writeup. there are a few really interesting UDRP cases involving seemingly generic names (i.e. Madonna and Target) See: http://www.weeklynames.com/2010/11/what-is-a-generic-domain-name/

  2. vvv says:

    I remember reading something awhile back that you couldn’t register words already in the dictionary ex. Cars can not be registered, but cars.com can be.

    1. I believe I read the same thing. I cannot remember the source.

  3. Hello,

    This is very very important that domainers pay attention to this.

    I have almost had a bad situation becauase of a trademark issue with a domain.

    Not good!

    1. Agreed. It’s just not worth the time and effort.

  4. Michael, good points made in your blog. I would also add to Paul’s comment about TESS. It’s not just boolean searching but also tm professionals look at phonetic pronunciations and expanded and reverse uses.

    Andy, you asked:

    Common law trademarks confuse me. Has a UDRP ever been filed when a common law trademark was referenced, and did the plaintiff win? It just seems so flimsy a case when a plaintiff can’t even file a $425 single-SIC trademark.

    Yes, many, many times. The common law trademark holder, however, must be able to prove that its mark has achieved what we call “acquired distinctiveness” or “secondary meaning.” UDRP panels have held that (1) the common law use had to occur before the domain name was registered; and (2) then weighs several factors to determine whether the common law mark has acquired distinctiveness such as monies invested in advertising, media exposure, revenue, etc.. The point is that the common law trademark holder has to prove that that the public has come to identify the common law mark with the source.

  5. A few years ago I had various mis-spells of the famous London Harrods store. These included Hardrods.com and Harodds.com.
    Hardrods was set up as an affiliate site with a genuine link to the real Harrods. Over a year I grossed I’ve £100 in commission. I then received letters from Harrods lawyers Nd even although I tried to show them that my intentions were good they threatened me with all sorts quoting previous cases where they had successfully beaten so-called cyber squatters. I gave in

    1. That’s tough, Malcolm. I cannot imagine any company wanting a person — however well intentioned — using typographical errors of their domain name to send them customers, and having to pay you for them on top of it.

      In their eyes, they may have finally realized, you shouldn’t have made any of that money since it was their goodwill, brand and domain name that caused those people to type in the domain name (and mis-spell it).

      Do you not see it from their perspective as well?

  6. Andrew,

    Great article. I would add the following comments regarding TM searches:

    1. TESS is a great system but it can be dangerous and inaccurate for the inexperienced user. Unless you know how to enter a boolean search, the matches are not exact.

    2. I find GOOGLE to be a much better and faster source of possible trademark conflicts. Remember that in both a UDRP and in litigation a plaintiff may sue based on common law trademarks. A Google search that shows trademark-like use in the top 10 should indicate either a registered or common law mark may be in play.

    PRK

    1. Paul,

      Thanks. Good advice as well … doing a a Google search instead of just a TESS search.

      Common law trademarks confuse me. Has a UDRP ever been filed when a common law trademark was referenced, and did the plaintiff win? It just seems so flimsy a case when a plaintiff can’t even file a $425 single-SIC trademark.

      Would love to hear if there are any cases you can cite.

      Best,
      Andrew

  7. Kevin says:

    Nice article…let me add as a lawyer, I would also caution purchasing a domain name even if the TM is listed as “DEAD.” This is because although surmised as dead, the original mark still holds value. As an example, if the TM holder decides to re-apply or dispute the validity of their own TM then they still have standing..even years later, therefore, the domain holder may lose. Too, not to worry…if a company lists a mere word in their TM description at the time of their application this does not mean they own the domain name rights to just any potential domain name.

    Even if you own a domain name such as: Cragslist.com…if you are using the domain name attached to a website to offer information of how to contact past school mates for an upcoming H.S. reunion at Crags High School…Craigslist.com as we know it will have no standing and the arbitrator will side with the defendant. Why? This is because a company may not own all and everything in life and they MUST show how they were harmed and or damaged at the very minimum…so least we become to concerned…Kev

    1. Wouldn’t most attorneys caution about doing anything? :) It’s in your nature. Which is why I’m glad to not be an attorney, but have a bunch as friends!

      Good advice about the dead trademarks that can come back to haunt you.

      I fully agree about Cragslist.com, but I think a lot of domainers just give up as soon as they get a UDRP action or such. If they pay that much for a domain name (even one like XYZ.com), they better start to use it in some way to make sure that they have their “case” in case a zipper company (in the XYZ example) comes a knocking looking for your valuable domain name.

  8. Tony Bellows says:

    Great advice. I always do trademark searches before I pay more than $100 for a domain name. It’s not worth the hassle otherwise to deal with a UDRP (speaking from experience) or c&d.

    1. Thanks, Tony. Agreed.

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