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Yahoo!, Inc.v/s Akash Arora

The Yahoo! Inc. is considered as a landmark case on cybersquatting in India as it was for the primary time that the High Court of Delhi held that a registered website name similar to the trademark giving it the entitled, equal protection. It presents an important issue of law pertaining to the passing off under Trademark law in India. The case discusses Sections 27 and 29 of the Trade and Merchandise Marks Act and its applicability to the case.

Facts of the Case
  1. Yahoo Incorporation, the plaintiff was the owner of a documented trademark, “Yahoo” and of the name “Yahoo.com” both domain name and trademark acquired a distinctive name, good will and reputation
  2. Since 1995, Yahoo.com was registered by Yahoo Inc with Network Solution known to offer a wide range of web-based services.
  3. In almost 69 countries, the trademark was registered in or was on the brink of being registered countries.
  4. The plaintiff’s Yahoo Inc did not register its name in India.
  5. The defendant, Akash Arora started a company with the domain name “Yahoo India” which offered internet services similar to that of the plaintiff, Yahoo Inc.
  6. The plaintiff aggrieved by this filed a suit seeking permanent injunction in order to restrain the defendant from continuing their business under the impugned domain name of ‘Yahooindia.com’ or any identical name.
  7. The plaintiff subsequently filed an application for an ad interim temporary injunction under Order 39 Rules 1 and 2 of CPC in order to restrain the defendants from using the plaintiff’s domain name ‘Yahooindia.com’

Issues Raised
  1. Whether a domain name is protected under the Intellectual Property Rights?
  2. Whether the defendant’s act of registering the name “Yahoo India” to offer identical services as that of the plaintiff’s Yahoo Inc be considered as an infringement of the plaintiff’s trademark and amount to passing-off under the relevant sections of the Trade and Merchandise Marks Act?

Arguments
Plaintiff’s contentions:
The plaintiff’s counsel contented that the plaintiff’s trademark and domain were not only well-known marks but also had a ‘distinctive reputation’ and ‘goodwill’ and the defendants by using the domain name of ‘Yahoo india’ were passing off their goods and services as that of the plaintiff owing to the fact that ‘Yahoo India’ was strikingly ‘identical and deceptively similar’ to the trademark of the plaintiff’s.

The counsel submitted that that the plaintiff’s domain name and trademark were protected against a passing off action as that would be in the case of an infringement of trademark. The counsel added that the defendants by taking a deceptively identical trademark and copying the general overlay of the plaintiff’s domain name, attempted to pass off their services as that of the plaintiff’s.

The counsel submitted that:
the plaintiff’s trademark/ domain name is entitled to protection against passing off as it would be in the case of a trademark. The counsel added that domain names and trademarks are not mutually exclusive and that there is an overlap between trademarks and services rendered under domain names.

Hence, the defendants who adopted a deceptively identical trademark 'Yahoo India', have verbatim copied the plaintiff’s prior created regional section including its format, contents, lay out, colour scheme, source code of the plaintiff's prior created regional section on India at Yahoo.com.sg and claimed that it can be considered as passing off the services of the defendants’ as that of the plaintiff.

The counsel submitted that internet users who are familiar with the practice of companies to select domain names which usually incorporate their name, trademark, product/service name would attempt to locate a company's web site by typing either www.(company name).com or www.(product name).com when they are not completely sure about the company’s internet address of the Company and that it cannot be considered unusual for users looking for an authorised 'Yahoo!' site with India-specific content to type in 'Yahooindia.com', which would take them to the defendants site.

It was further stated that the plaintiff provided extensive content in India, both on its Yahoo Asia site and at the main Yahoo.com site, under the categories "Regional: Countries: India”.
Following this, it was submitted that the defendants who were in the plaintiff’s line of activity made an attempt to be 'cyber-squatters' and added that dishonesty is writ large because the defendants adopted a trademark identical to that of the plaintiff which had already acquired a distinctive name, goodwill and reputation by then.

The Defendants’ Contentions:
The counsel for the defendants, strongly refuted the allegations made by the plaintiff’s counsel and submitted that the trademark laws in India only relate to goods and making the provisions of the Indian Trade Marks Act inapplicable in the present case.

The counsel added that the plaintiff’s trademark/domain name 'Yahoo!' was not registered in India and therefore not only an action for infringement of the registered mark but possibility of any action of passing off must be over ruled. The counsel stated that the services rendered both by the plaintiff and the defendants cannot be said to be goods within the purview of the Indian Trade Marks Act as the provisions are not concerned with services and that the decisions the plaintiff’s counsel relied upon are irrelevant for to decide the present case.

It was further submitted that "Yahoo!" is a general dictionary word and not vented, and that cannot be said to acquire any distinctiveness. Since the defendants used a disclaimer, the counsel said there is not even slightest scope for deception and no action of passing of would be maintainable against the defendants.

The counsel added that the internet users seeking to reach the Internet site are all technically educated and literate making it highly unlikely that for a customer reaching the defendant’s internet site with an intention of reaching the plaintiff’s site and thus, this cannot be a case of unwary customer that is applicable in the case of infringement and passing off of the trademark.

Judgment
The Court in the present case addressing the issue of trademark not being registered in India stated that though the trademark of the plaintiff 'Yahoo!' was pending in India, plaintiff is a popular global Internet media rendering services under the domain name/trade name 'Yahoo!'.

The court was of the opinion that the present case does not concern itself with an action for infringement of a registered trademark, but addresses the issue of an action for passing off and stated that the law relating to passing off is well-settled and is a common law remedy.

In this regard, the court added that “the principle underlying the action for passing off is that no man is entitled to carry on his business in a way that leads to the belief that he is carrying on the business of another man or to lead to believe that he is carrying on or has any connection with the business carried on by another man”.

The court quoted the case of Monetary Overseas vs Montari Industries Ltd1., where the defendant adopted a trade name identical as that of plaintiff’s trade name and the court held that the defendant is liable for an action in passing off."

Adding on the issue of services rendered by a person being included within the scope of passing off, the court made reference to the decision in Ellora Industries Vs. Banarsi Dass & Ors2 wherein the court held that since plaintiff and the defendant were direct competitors and Ellora as a business name suggests association with the plaintiffs' registered trade mark, it is suggestive that the source of the goods is the same making it a misrepresentation in relation to origin of goods which the defendants manufacture in the course of their business.

The court quoted Lord Halsbury’s definition of tort of passing off which was stated in Reddaway Vs. Banham 3 and added the observation of Lord Greene M.R which is as follows:
"Passing off may occur in cases where the plaintiffs do not in fact deal with the offending goods".

The court was of the opinion that since the plaintiff and the defendants had common field of activity and were operating on the Web site providing information identical in nature, competition and rivalry is an obvious outcome.

The court addressing the issue of the possibility of users reaching one site intending to reach another cited that case of Card service International Inc. v/s. McGee 4, the Court granted the injunction as per, Section 32 of the Lanham Act as it held that customers would instead reach a different web page assuming it would be the same they intended to reach.

The court referred the case mentioned by the plaintiff’s counsel, Marks & Spencer Vs. One-in-a-Million 5; wherein it was held that:
any person who deliberately registers a domain name on account of its similarity to the name, brand name or trademark of an unconnected commercial organisation must expect to find himself on the receiving end of an injunction to restrain the threat of passing off, and the injunction will be in terms which will make the name commercially useless to the dealer.

It was held that though the word 'services' may not be expressly used in Sections 27 and 29 of the Trade and Merchandise Marks Act, the services rendered may be recognised for the action of passing off making the law of passing off an action under the common law which is very well given a statutory recognition in the Trade Mark Act.

Talking about the issue raised by the defendant’s counsel that Internet users are technically educated and literate people who may appropriately approach the actual Internet site they intend to visit, the court stated that it does not appear to have force. The reason being that even if an individual is a sophisticated, he/she could be an unsophisticated consumer of information and in such cases he/she may find their way to the defendant site that provides identical information as that of the plaintiff.

Addressing the issue raised by the defendant’s counsel in relation to using a disclaimer, the court stated that a disclaimer by the defendants cannot eliminate the problem.
In support to this statement the court made a reference to the case of Jews for Jesus Vs. Brodsky 6; wherein it was held that owing to the nature of Internet use, defendant's appropriation of plaintiff's mark as a domain name and home page address cannot adequately be remedied by a disclaimer.

Pertaining to the defendant’s contention regarding the word 'Yahoo!' being a dictionary word and hence cannot be appropriated as a domain name/trademark, the court was of the opinion that it is highly misplaced because though the said words are mere dictionary words they have acquired uniqueness and distinctiveness after being associated with the business of the concerned company and that such words have come to receive maximum degree of protection by courts.

In support to this statement, the court referred to the case of N.R. Dongre Vs. Whirlpool Corp 7, ,wherein the court recognising the uniqueness and distinctiveness of the trade name, held that the reputation of the trademark 'WHIRLPOOL' travelled across the borders and though the respondents are not the registered proprietors of the 'WHIRLPOOL' in India in respect of washing machines, an action of passing off against the appellants in respect of the use of the same can be maintained.

The court held that since the plaintiff was successful in making a prima facie case for the grant of ad interim injunction in their favour, an ad interim injunction will be passed in favour of the plaintiff as against the defendants thereby refraining the defendants and their partners/servants/agents from operating any business, sale, advertising or dealing in service or goods on the internet or under the trademark/domain name 'Yahooindia.com' or any other trademark/domain name which is deceptively similar to the plaintiff’s trademark till the disposal of the suit.

Analysis
The case is rightly considered as a landmark judgment as it was the first time a domain name was equated to a trademark thereby providing equal protection from passing off in India. The case paved a breakthrough by addressing the issue of making the common law principle of passing off applicable in cases of domain names as well and made the judgment a significant precedent for other internet-based trademark related cases in India.

The judgment can be considered significant in the impact it caused by stating that law of passing off for infringing trademarks and domain names in cases of services as well given the situation of uncertainty and confusion with respect to infringement of domain names.

The case was one of the very few cases that highlighted the concept of cyber -squatting which needed immediate attention. Laying down remedies to plaintiffs in such cases can be considered as a great relief to people who have not only been victims of such cases but also to people who intend to venture into new businesses of a nature which is vulnerable towards infringement of domain names.

The court by referring to both Indian and foreign judgements made its stance clear and strong.

Conclusion
Internet is a strange place. For one it is a place to search for resources, for one it is a source of entertainment and for one it is a place of carrying out business. Often a person does not realise how his/her actions make a huge difference in an another person’ business unintentionally. This case is a classic example that shows that an internet user might not intend to go to another site but their lack of knowledge about people using identical domain names lands them in soup.

This could result in huge loss to the rightful owners of the internet sites. Fake shopping websites are one of the contemporary examples. In such situations, the accurate interpretation of provisions and correct identification of remedies in the court of law is obliged with the responsibility of delivering justice to the aggrieved party and spreading awareness thereby giving assurance to the people who may face similar situations.

Equivalent citations: 1999 IIAD Delhi 229, 78 (1999) DLT 285
Author: M Sharma
Bench: M Sharma

End-Notes:
  1. (Montari Overseas Limited vs Montari Industries Limited, 1995
  2. (Ellora Industries vs Banarsi Das Goela And Ors, 1979)
  3. [1896] A.C. 199
  4. 950 F. Supp. 737 (E.D. Va. 1997) January 16, 1997
  5. [1998] F.S.R. 265, The Times, December 2, 1997.
  6. 98 Civ. 274 (AJL)
  7. 6 (N.R. Dongre And Ors vs Whirlpool Corporation And Anr,1996)

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