IMPORTANT POINT
Internet domain names are subject to the legal norms applicable to other intellectual properties such as trade marks and the principles of trade mark law and in particular those relating to passing off apply.

Headnote:(i) Trade Marks Act, 1999-Sections 2(zb), 2(m), 2(k), 2(j)-Trade mark -Internet domain names-Whether subject to legal norms applicable to other intellectual properties such as trade marks-(Yes)-Whether a domain name can be said to be a word or name which is capable of distinguishing the subject of trade or service made available to potential users of the internet-(Yes)-Would the principles of trade mark law and in particular those relating to passing off apply-(Yes).
       Held : A "mark" has been defined in Section 2(m) as including "a device, brand, heading, label, ticket, name, signature, word, letter, numeral, shape of goods, packaging or combination of colours or any combination thereof" and a `name includes any abbreviation of a name (S.2(K)). (Para 9)
       The original role of a domain name was no doubt to provide an address for computers on the internet. But the internet has developed from a mere means of communication to a mode of carrying on commercial activity. With the increase of commercial activity on the internet, a domain name is also used as a business identifier. Therefore, the domain name not only serves as an address for internet communication but also identifies the specific internet site. In the commercial field, each domain name owner provides information/services which are associated with such domain name. Thus a domain name may pertain to provision of services within the meaning of Section 2(z). A domain name is easy to remember and use, and is chosen as an instrument of commercial enterprise not only because it facilitates the ability of consumers to navigate the Internet to find websites they are looking for, but also at the same time, serves to identify and distinguish the business itself, or its goods or services, and to specify its corresponding online Internet location. [Intellectual Property and the internet-RODNEY D RYDER-Page 96 to 97]. Consequently a domain name as an address must, of necessity, be peculiar and unique and where a domain name is used in connection with a business, the value of maintaining an exclusive identity becomes critical. "As more and more commercial enterprises trade or advertise their presence on the web, domain names have become more and more valuable and the potential for dispute is high. Whereas a large number of trade marks containing the same name can comfortably co-exist because they are associated with different products, belong to business in different jurisdictions etc, the distinctive nature of the domain name providing global exclusivity is much sought after. The fact that many consumers searching for a particular site are likely, in the first place, to try and guess its domain name has further enhanced this value" [See Information Technology Law Diane Rowland and Elizabeth Macdonald 2nd Edition p. 521]. The answer to the question posed in the preceding paragraph is therefore an affirmative. (Para 12)
       An action for passing off, as the phrase "passing off" itself suggests, is to restrain the defendant from passing off its goods or services to the public as that of the plaintiff s. It is an action not only to preserve the reputation of the plaintiff but also to safeguard the public. The defendant must have sold its goods or offered its services in a manner which has deceived or would be likely to deceive the public into thinking that the defendant s goods or services are the plaintiff s. The action is normally available to the owner of a distinctive trademark and the person who, if the word or name is an invented one, invents and uses it. If two trade rivals claim to have individually invented the same mark, then the trade who is able to establish prior user will succeed. The question is, as has been aptly put, who gets these first? It is not essential for the plaintiff to prove long user to establish reputation in a passing off action. It would depend upon the volume of sales and extent of advertisement. (Para 13)
       The second element that must be established by a plaintiff in a passing off action is misrepresentation by the defendant to the public. The word misrepresentation does not mean that the plaintiff has to prove any malafide intention on the part of the defendant. Ofcourse, if the misrepresentation is intentional, it might lead to an inference that the reputation of the plaintiff is such that it is worth the defendant s while to cash in on it. An innocent misrepresentation would be relevant only on the question of the ultimate relief which would be granted to plaintiff. [CADBURY SCEHWEPPES vs. PUB SQUASH 1981 RPC 429, ERVEN WARNINK vs. TOWNEND 1980 RPC 31]. What has to be established is the likelihood of confusion in the minds of the public, (the word "public" being understood to mean actual or potential customers or users) that the goods or services offered by the defendant are the goods or the services of the plaintiff. In assessing the likelihood of such confusion the courts must allow for the "imperfect recollection of a person of ordinary memory". [ARISTOC vs. RYSTA 1945 AC 68]. The third element of a passing off action is loss or the likelihood of it. The use of the same or similar domain name may lead to a diversion of users which could result from such users mistakenly accessing one domain name instead of another. This may occur in e-commerce with its rapid progress and instant (and theoretically limitless) accessibility to users and potential customers and particularly so in areas of specific overlap. Ordinary consumers/users seeking to locate the functions available under one domain name may be confused if they accidentally arrived at a different but similar web site which offers no such services. Such users could well conclude that the first domain name owner had mis-represented its goods or services through its promotional activities and the first domain owner would thereby lose their custom. It is apparent therefore that a domain name may have all the characteristics of a trademark and could found an action for passing off. (Paras 14 to 16)
       However, there is a distinction between a trademark and a domain name which is not relevant to the nature of the right of an owner in connection with the domain name, but is material to the scope of the protection available to the right. The distinction lies in the manner in which the two operate. A trademark is protected by the laws of a country where such trademark may be registered. Consequently, a trade mark may have multiple registration in many countries throughout the world. On the other hand, since the internet allows for access without any geographical limitation, a domain name is potentially accessible irrespective of the geographical location of the consumers. The outcome of this potential for universal connectivity is not only that a domain name would require world wide exclusivity but also that national laws might be inadequate to effectively protect a domain name. (Para 18)
       As far as India is concerned, there is no legislation which explicitly refers to dispute resolution in connection with domain names. But although the operation of the Trade Marks Act, 1999 itself is not extra territorial and may not allow for adequate protection of domain names, this does not mean that domain names are not to be legally protected to the extent possible under the laws relating to passing off. (Para 25)
       (ii) Trade Marks Act, 1999-Sections 2(zb), 2(m), 2(k), 2(j)-Internet domain names-Claim of -Appellant company was incorporated in 1995-It registered several domain names like www.sifynet, www.sifymall.com, www.sifyrealestate.com etc. in 1999-Appellant claims a wide reputation and goodwill in the name sify -Respondent started carrying on business of internet marketing under the domain names, www.siffynet, net and www.siffynet.com from June 2001-Appellant served notice on respondent to cease and desist from either carrying on business in the name, of siffynet Solutions (P) Ltd. or Siffynet Corporation and to transfer domain names to appellant-Respondent refused-Appellant filed a suit alleging that respondent was passing off its business and services by using his name and domain name-Application for temporary injunction allowed on ground that appellant was prior user of trade name Sify that it had earned good reputation in connection with the internet and computer services under the name Sify -Appeal against-High Court allowed respondents appeal-Whether decision of the High Court is justified-(No).
       Held : The appellant s claim to be a leading information technology services company and one of the largest internet services providers in the country has not been seriously disputed by the respondent nor is there any challenge to the appellant s claim that it has more than 5 lac subscribers, 840 Cyber cafes, and 54 points of presence all over India. That it is the first Indian internet company to be listed in 1999 with NASDAQ where it trades under the tradename Sify was given extensive coverage in leading national Newspapers. The appellant has brought on record the stringent conditions and deposit of a large fee for having a trade name included in the NASDAQ International market. The appellant has complied with the conditions for listing. The appellants have claimed that its shares are since 1999 actively traded in on a daily basis on the NASDAQ. It is also claimed that the appellant has widely used the word Sify as a trade name/domain name for its software business and services. The appellant s website www.sify.com is claimed to be a comprehensive internet site with a gamut of subjects to choose from. It has brought out brochures and issued advertisements offering services in the internet under the name Sify . It has submitted its sale figures and expenses incurred on advertisement and market promotion of its business under the tradename Sify. It is also claimed that apart from the fact that the appellant is popularly known as Sify, it has also applied for registration of more than 40 trademarks with the prefix Sify under the Trade and Merchandise Marks Act, 1958 (since replaced by the Trade Marks Act, 1999). (Para 27)
       The appellant has been able to establish the goodwill and reputation claimed by it in connection with the tradename Sify . Apart from the close visual similarity between Sify and Sify , there is phonetic similarity between the two names. The addition of net to Siffy does not detract from this similarity. (Paras 28 & 29)
       What is also important is that the respondent admittedly adopted the mark after the appellant. The appellant is the prior user and has the right to debar the respondent from eating into the goodwill it may have built up in connection with the name. Another facet of passing off is the likelihood of confusion with possible injury to the public and consequential loss to the appellant. The similarily in the name may lead an unwary user of the internet of average intelligence and imperfect recollection to assume a business connection between the two. Such user may, while trying to access the information or services provided by the appellant, put in that extra f and be disappointed with the result. Documents have been filed by the respondent directed at establishing that the appellant name Sify was similar to other domain names such as Scifinet, Scifi.com etc. The exercise has been undertaken by the respondent presumably to show that the word Sify is not an original word and that several marks which were phonetically similar to the appellants trade name are already registered. We are not prepared to deny the appellant s claim merely on the aforesaid basis. For one, none of the alleged previous registrants are before us. For another, the word sci-fi is an abbreviation of science fiction and is phonetically dissimilar to the word Sify. (Paras 31 & 32)
       The High Courts finding that no prejudice would be caused to the appellant because it had another domain name was a consideration which might have been relevant if there was a case of bonafide concurrent use and where the right to use was co-equal. The doubtful explanation given by the respondent for the choice of the word "Siffy" coupled with the reputation of the appellant can rationally lead us to the conclusion that the respondent was seeking to cash in on the appellant s reputation as a provider of service on the internet. In view of our findings albeit prima facie on the dishonest adoption of the appellant s tradename by the respondent, the investments made by the appellant in connection with the trade name, and the public association of the tradename Sify with the appellant, the appellant is entitled to the relief it claims. A different conclusion may be arrived at if evidence to the contrary is adduced at the trial. But at this stage and on the material before the Court, we are of the view that the conclusion of the High Court to the contrary was unwarranted. (Para 35)

Judgement Key Points

Based on the provided legal document, the complaint was allowed and the plaintiff succeeded in the case. The court set aside the decision of the lower court and affirmed the decision in favor of the plaintiff, granting the relief sought. The court found that the plaintiff had established sufficient evidence of prior use, reputation, and goodwill in the trade name "Sify," and that the defendant's use of a similar domain name was likely to cause confusion and misrepresentation among the public. Consequently, the court concluded that the balance of convenience favored the plaintiff, and the appeal was allowed with the original order reinstated (!) .

JUDGMENT

Ruma Pal, J.-Leave granted.

2. The principal question raised in this appeal is whether internet domain names are subject to the legal norms applicable to other intellectual properties such as trade marks? The appellant which was incorporated in 1995 registered several domain names like www.sifynet, www.sifymall.com, www.sifyrealestate.com etc. in June 1999 with the internationally recognised Registrars, viz the Internet Corporation for Assigned Names and Numbers (ICANN) and the World Intellectual Property Organisation (WIPO). The word Sify is a coined word which the appellant claims to have invented by using elements of its corporate name, Satyam Infoway. The appellant claims a wide reputation and goodwill in the name Sify .

3. The respondent started carrying on business of internet marketing under the domain names, www.siffynet.net and www.siffynet.com from 5th June 2001. The respondent claims to have obtained registration of its two domain names with ICANN on 5th June, 2001 and 16th March, 2002 respectively.

4. Coming to know of the use of the word Siffy as part of the respondent s corporate and domain name, the appellant served notice on the respondent to cease and desist from either carrying on business in the name of Siffynet Solutions (P) Ltd. or Siffynet Corporation and to transfer the domain names to the appellant. The respondent refused. The appellant filed a suit in the City Civil Court against the respondent on the basis that the respondent was passing off its business and services by using the appellant s business name and domain name. An application for temporary injunction was also filed. The City Civil Court Judge allowed the application for temporary injunction on the grounds that the appellant was the prior user of the trade name Sify , that it had earned good reputation in connection with the internet and computer services under the name Sify , that the respondent s domain names were similar to the domain name of the appellant and that confusion would be caused in the mind of the general public by such deceptive similarity. It was also found that the balance of convenience was in favour of granting an injunction in favour of the appellant.

5. The respondent preferred an appeal before the High Court. An interim stay of the City Civil Judge s judgment was granted. The appeal was ultimately allowed by the High Court. This order is the subject matter of challenge in this appeal. In allowing the appeal, the High Court was of the view that merely because the appellant had started the business first, no order could have been granted in its favour without considering where the balance of convenience lay. It was held that the finding that the appellant had earned a reputation and goodwill in respect of the domain name Sify was not based on a consideration of the necessary factors. On the other hand, the documents on record showed that the respondent was doing business other than that done by the appellant and since there was no similarity between the two businesses, there was no question of customers being misled or misguided or getting confused. It was held that the respondent had invested a large amount in establishing its business and that it had enrolled about 50,000 members already. It was held that the respondent would be put to great hardship and inconvenience and also irreparable injury in case the injunction order was granted. On the other hand, since the appellant had a separate trade name, namely Satyam Infoways, no injury or hardship would be caused to the appellant if the order of injunction was not granted.

6. From the narration of these facts, it is clear that both the Courts below had proceeded on the basis that the principles relating to passing off actions in connection with trademarks are applicable to domain names. However, the respondent has contended that a Domain Name could not be confused with "property names" such as Trade Marks. According to the respondent, a domain name is merely

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2004 Supreme(SC) 596

IMPORTANT POINT Internet domain names are subject to the legal norms applicable to other intellectual properties such as trade marks and the principles of trade mark law and in particular those relating to passing off apply.

IMPORTANT POINT
Internet domain names are subject to the legal norms applicable to other intellectual properties such as trade marks and the principles of trade mark law and in particular those relating to passing off apply.