Trademarks are generally protected under trademark legislation (for a registered trademark) and common law tort of passing off (for unregistered trademark).
Brand owners are always encouraged to have their trademarks registered because that will enhance their protection in the sense that registered trademark owners will enjoy exclusive rights in connection with the class of goods/services for which the trademarks are registered in.
Courts in many jurisdictions, including Malaysia, have recognized that the protection of trademark laws extends to the use of trademark over the Internet.
However, in this Internet age where the use of the trademark (whether authorized or unauthorized) is becoming so prevalent, registering trademark alone is not enough when it comes to protecting and enforcing trademark rights.
The Internet presents many opportunities and challenges to brand owners. Brand owners will need to develop and implement strong brand management and protection strategy, alongside with continuously monitor, protect and enforce their trademark rights to prevent misappropriation of the goodwill and reputation in their trademarks.
This article outlines several forms of trademark infringement that currently take place on the Internet.
Cyber Squatting
“Cybersquatting” is a form of trademark infringement. It refers to an act of registering, trafficking in or using a trademark belonging to someone else with bad faith intent to profit from such an act.
For example, in 2008, an individual from Ipoh registered www.google.my as his domain name. When Google Inc. found out about that, Google Inc. filed a complaint against that individual and won the case because Google managed to prove that the domain name was identical with its trademark and that the individual had registered and/or used the domain name in bad faith.
If a domain name dispute involves generic top-level domains (gTLDs)(e.g. .biz, .com, .info, .mobi, .name, .net, .org), the trademark owner can file a complaint with any of the approved dispute resolution service providers accredited by the Internet Corporation for Assigned Names and Numbers (ICANN) under the Uniform Domain Name Dispute Resolution Policy (UDRP).
If a domain name dispute involves country code top-level domains (ccTLDs) (e.g. .my), the trademark owner can file a complaint with the Regional Centre for Arbitration Kuala Lumpur under the Mynic’s Domain Name Dispute Resolution Policy (MyDRP).
Auction Sites
Trademark owners have brought legal suits against large auction sites for allowing their users to misappropriate legitimate trademarks on their sites to attract buyers to buy counterfeit goods.
In Tiffany v eBay (2010), Tiffany brought a trademark infringement suit against eBay for the sale of non-genuine jewellery of the auction site. The US Court of Appeals rejected the claim of direct infringement on the basis that eBay used the mark to describe the genuine Tiffany goods offered for sale on the site.
The court held that eBay’s alleged knowledge of the availability of counterfeit goods on the site was not a basis of such a claim and to impose liability on such grounds would unduly inhibit the lawful resale of genuine Tiffany goods. The fact that eBay also removed those listings involving the sale of counterfeit goods upon being notified by Tiffany and suspended repeat offenders showed that eBay had not contributed to the infringement.
Similarly, in L’Oréal v eBay (2009), the UK court decided that L’Oréal failed to prove that eBay had procured sellers’ particular acts of infringement and that eBay was not under a legal duty to prevent infringement and that mere facilitation with knowledge and intention to profit was not enough to establish a joint liability trademark claim.
These two cases show that, while there is no doubt that the individual sellers have infringed the trademark rights by selling counterfeit goods online, it is difficult to also argue that the auction sites are jointly liable with the sellers.
Virtual World
Trademark infringement also takes place in virtual world online games such as Second Life, an online social community created by Linden Labs.
Second Life facilitates and encourages user-generated content, which can be sold to other users for virtual currency, which can, in turn, be exchanged for real currency. There is a real risk that users may create and sell digital content which infringes the trademark rights of real-life brands. For that reason, many real-life brands have established themselves within Second Life.
In the US case of Taser International Inc v Linden Research Inc (2009), Taser filed a trademark infringement suit against Linden as Second Life’s users have created and sold virtual guns bearing Taser brand in Second Life.
The case was settled out of court subsequently. This case goes to show that brand owners will now have to also monitor the unauthorized use of their trademarks in both physical and virtual worlds.
Social Media
The popularity and the use of online social networking sites such as Facebook, Twitter, YouTube and LinkedIn have grown exponentially across almost all jurisdictions around the world.
The username features on social networking sites have created a new form of cybersquatting.
For example, a user who has registered an account on Facebook is given a vanity URL for his profile page. Hence, instead of www.facebook.com/id=8473659, a user’s vanity URL is known as www.facebook.com/yourname. This obviously posed a new risk to brand owners as users could, theoretically, choose a name consisting of a trademark not belonging to them. In light of this risk, many real-life brand owners have established an official Facebook page.
Facebook has established a mechanism for reporting infringing usernames.
If a brand owner discovers that a third party’s username consists of his registered trademark, he can complain to Facebook by using the forms provided by Facebook and ask Facebook to remove the contentious page or disable access to that page. To further ensure that only brand owners get to keep their username, Facebook’s usernames are not transferable (hence eliminating the problem of registering the username in bad faith with the intent to profit from such act) and that usernames which have been removed will no longer be made available to other users.
Similarly, on Twitter, each user is given a username upon registration, for .e.g. @yourname.
Many brand owners have also established an official profile on Twitter to communicate with its customers and fans, while at the same time they also try to eliminate the risk of users registering a username consisting of their brand and “tweet” from that account, which may confuse consumers and fans into thinking that they are interacting with an official representative of the brand.
Twitter has also established a trademark violation mechanism which it says that it will suspend a user’s account if there is a clear intention to mislead others through the unauthorized use of a mark. Twitter uses “verification badges” to confirm the authenticity of identities of key individuals and brands on Twitter. The verified account will have a blue verified checkmark badge located in the top-right portion of a user’s profile page just above the name, location, and bio.
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About the author:
This article was written by Edwin Lee Yong Cieh, Partner of LPP Law – law firm in Kuala Lumpur, Malaysia (+6016 928 6130, [email protected]).
This article was first published in CHIP Magazine Malaysia.
The view expressed in this article is intended to provide a general guide to the subject matter and does not constitute professional legal advice. You are advised to seek proper legal advice for your specific situation.
Edwin is a corporate and technology lawyer. He is also the founder and deputy managing partner of Lee & Poh Partnership (LPP Law). Edwin has advised a range of companies from technology startups to multinational corporations on a range of matters. In 2020, Edwin was named as a Malaysian Rising Star by Asian Legal Business, a finalist for the Young Lawyer of the Year at the ALB Malaysia Law Awards as well as a lawyer in the annual ALB publication of Asia 40 under 40.
View his full profile here.
