Legal Updates

Intellectual Property – Domain Name Dispute – Trade Mark – Freedom Of Expression – Cyber-Squatting – Bio Pharmaceutical Company

The case of Patel v Allos Therapeutics Inc [2008], involved a claimant that issued proceedings against the defendant, a pharmaceutical company. The claimant alleged that his right to freedom of expression had been violated due to a decision made by the panel of the Uniform Dispute Resolution Procedure. The decision in question related to a successful challenge by the defendant to his registration of the defendant company’s name as an internet domain name.

The defendant in this case was a global biopharmaceutical company. It owned the following US trade marks:

• “Allos”; and
• “Allostherapeutics Inc”.

In the course of its business dealings, it had elected to register the internet domain name “allos.com”. Using that domain name, the defendant company hosted a website on which it used its trading name.

The claimant in this case was a horticulturalist. He had no business dealings in the pharmaceutical industry. It should be noted however that he persistently registered the names of companies to whom he had no connection as internet domain names. One of the company names registered by the claimant was that of the defendant company.

The claimant's principal purpose for registering such domain names was to “wage an ideological war” against what he saw as the evils of corporations engaged in business in the pharmaceutical industry. In registering the domain names, the claimant's actions were not carried out so as to steal the companies' business, or to make any financial gain, but instead were intended to expose the alleged immorality of the industry and its lawyers.

The websites that he used contained the relevant company's logos and trade marks, and operated as crudely constructed protest sites. The intention behind the construction of the sites was to direct users that were searching for the company in question to a website in the name of the company on which the company's logo was displayed (For example: “[Trademark.ltd]”).

The home page would then be fully viewed before a disclaimer was seen or the user could otherwise realise that the site was not affiliated with the company. In June 2005, the claimant registered the domain name “allostherapeutics.com” with the internet domain registrar. It should be noted that it was central to both sides’ arguments that the contract had incorporated the Internet Corporation for Assigned Names and Numbers' (“ICANN”) Uniform Dispute Resolution Procedure (“UDRP”) rules and policy.

The UDRP outlines an international system for domain name governance. It is only applicable to dot-com domain names and was set up by the World Intellectual Property Organisation. The UDRP rules establish a mandatory administrative procedure which governs disputes between trade mark owners and domain name registrants. It should be noted that the enforcement of the UDRP rules is based entirely on a private contract governing the circumstances in which a domain name might be maintained, and that the terms of the contract between the registrant and registrar were distinct from the question as to whether there had been an infringement of the complainant's intellectual property rights under the law of any specific country.

Under paragraph 4 of the UDRP, a registrant of a domain name is required to submit to a mandatory administrative arbitration procedure in the event that a third party makes a complaint as to the registrant's use of the domain name.

In April 2007, the defendant made a complaint alleging that the domain name registered by the claimant had been registered contrary to its legitimate interests as trade mark proprietor. At this point the complaint was upheld, however, the claimant subsequently brought proceedings against the defendant.

The claimant argued that the UDRP process should be set aside on an unspecified ground under the Human Rights Act 1998. He claimed that the panel’s decision should be declared void due to the fact that it infringed his right to freedom of expression under Article 8 of the European Convention on Human Rights.

The defendant subsequently made an application for the claim to be struck off in accordance with Civil Procedure Rule 3.4. The defendant company argued that the claim was not brought on reasonable grounds or on grounds suitable for summary judgment pursuant to Civil Procedure Rule 24.2. This was because the claimant had no real prospect of the claim succeeding. Furthermore, they argued that there was no other suitable reason for the matter to proceed to trial.

The application was allowed.

The court held that freedom of expression was not unqualified. However, it had to be balanced against the rights of others, which according to the court, included the rights of a minority not to suffer abuse and the rights of a trade mark owner to enjoy its rights.

The court was of the opinion that it was in the public’s interest to provide free speech forums on the Internet which could be used to criticise companies and their actions. But the court further stated that certain factors took the circumstances of this case out of that general proposition.

The claimant in this case had used a domain name which was no more than the trading name of the company itself. He had made no effort to show that the website was a site used for protesting against the defendant company’s actions.

Furthermore, the site in question had used the defendant's own trade mark, which meant that the claimant was effectively posing as the defendant company in order to attract members of the public to his site. The court held that he was clearly attempting to facilitate confusion in the minds of the public.

The court held that it was not within the meaning of free speech to use a domain name and trade mark that users would associate with the defendant in order to trick those users. In addition, there was no active criticism site or even a link to one at that website. This was exacerbated by the fact that the claimant would not accept that he was the aggressor, and not the victim.

He was neither debarred from making legitimate criticisms of pharmaceutical companies nor from setting up proper criticism websites which could be used as platforms for such criticism. Instead of setting up a legitimate protest site, he had elected to use names and logos contrary to the UDRP policy to which he was contractually obliged to adhere.

This meant that the claim made by the claimant that his rights of free expression were undermined in relation to the domain name was certain to fail, as the claims were deemed to be without merit.

It should also be noted that neither the claim form nor the particulars of claim gave any reasonable grounds for initiating the proceedings as the causes of action pleaded were ill-founded. Finally, the court held that the claimant had no real prospect of succeeding in his claim, and so could not find any other reason why the case should proceed.

If you require further information contact us at [email protected]

Visit http://www.rtcoopersiplaw.com or http://www.rtcoopers.com/practice_intellectualproperty.php

© RT COOPERS, 2008. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances.