Blanket orders smother infringing trademark actions

By Manisha Singh and Anirudh Arora, LexOrbis

The internet is the new marketplace. Online domain disputes involving the internet and e-commerce platforms are on the rise. Many cases of domain name squatting involving well-known trademarks and marks affiliated with well-known brands have been reported.

Blanket orders smother infringing trademark actions Manisha Singh
Manisha Singh

In Snapdeal Private Limited v Godaddycom Llc And Ors the Delhi High Court heard a quia timet application by the plaintiff against the potential misuse of its registered mark Snapdeal, which formed part of its domain name. Such an application is for an injunction to prevent future unlawful acts that are threatened or imminent. Snapdeal applied for an injunction against domain name registrars (DNRs) to prevent them registering any domain name including its trademark, Snapdeal.

Snapdeal named 32 DNRs as defendants together with the Department of Telecommunications and the National Internet Exchange of India. The application named none of the entities that had already registered domain names that were alleged to be infringing.

The applicant alleged that entities had registered domain names incorporating the Snapdeal mark and had used them for unlawful activities such as offering lucky draws and posing as customer care centres for the applicant’s products. The applicant contended that by offering registration domain names including the mark Snapdeal, the domain registrars were facilitating infringement of its registered mark and were themselves infringers within the meaning of sections 28(1) and 29(2) of the Trade Marks Act, 1999 (act).

The court considered such issues as intermediary liability, the defendants’ entitlement to a safe harbour defence, whether registering domain names containing the mark Snapdeal infringed the plaintiff’s rights, the technological feasibility of avoiding the registration of infringing domain names by the defendants and the non-joinder of necessary parties. It is noteworthy that most of these issues were decided in the plaintiff’s favour. The court even held that by using the algorithm that made the infringing domain names available to prospective registrants, the DNRs would themselves be infringers within the meaning of section 29 of the Trade Marks Act. In order to avoid liability, the DNRs would have to recode their algorithms in such a way that domain names infringing the applicant’s mark were not offered.

Blanket orders smother infringing trademark actions Anirudh Arora
Anirudh Arora
Senior Associate

The decisive factor was whether the plaintiff was entitled to grant the injunction against the DNRs preventing them from providing domain names containing the infringing mark in the future. The court observed that the application was made quia timet. The court explained the nature of the application as “one that seeks, in advance, relief against any prospective damage. In the case of infringement, a quia timet action can seek an interdiction against infringement even before such infringement takes place.”

However, the court held that an application can only be in respect of marks which are known to be prospectively infringing and not for speculative infringements. The court said that it is not permissible to hold, in advance, that every domain name containing the mark Snapdeal would necessarily be infringing in nature. The court would not in an omnibus and global fashion restrain DNRs from providing a domain name containing the mark in question. Emphasising the provisions of sections 28(1) and 29 of the Trade Marks Act, the court held that the alleged infringing mark must be clear and identifiable and applicants have to identify the marks that they allege infringe their registered trademarks.

The court acknowledged that the applicant had to necessarily apply to the court for an injunction against every domain name that it alleged infringed its registered mark, holding that the court had a duty to decide whether such a mark was, in fact, infringing and whether it was right to grant an injunction. The court held that there is no shortcut to justice and that the applicant had to undertake the long and cumbersome exercise against each domain name that it alleged to be infringing. The court therefore refused to grant the application.

The emergence of the online marketplace has brought along with it a new set of challenges. In order to deal with novel legal issues, legal principles and jurisprudence must also evolve.

Manisha Singh is a partner and Anirudh Arora is a senior associate at LexOrbis.

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