Consider this (and it is something to consider in today's marketplace, which is highly driven by the Internet):

You are carrying on a widget business. It is a mid-size business. It is growing and you are becoming well known in the widget industry. Unfortunately, two of your employees (who turned out not to be the top notch employees you initially thought they were), specifically, Bill and Ted from your product development team, decide to leave suddenly. You are not all that concerned until one of your clients advises that they have started a competing business. It turns out that Bill and Ted have registered and now potential clients who do a search are directed to their site and not yours The kicker is that your company actually is Widgets Ltd. And goes by the business name of "Widgets R Us". There are many issues, but two are particularly troubling. Prospective clients are directed to Bill and Ted's website and believe that they are dealing with you. Bill and Ted are relying on your reputation to entice business. And, frankly, Bill and Ted do not offer nearly the quality of widgets that you offer, but those who purchase their badly made widgets think they were produced by you. Some customers may look into this and realize the mistake. Others may simply bad mouth your widgets. And in the same manner that you thought the Internet was a great forum for attracting business, it is now a conduit (apart from Bill and Ted of course) of the damage to your reputation.

What can you do?

Contact The CIRA. CIRA is the Canadian Internet Registration Authority. It operates and governs the ".ca" domains. CIRA has instituted a dispute resolution process, which involves an administrative hearing before a panel. The process is governed by CIRA's "Domain Name Dispute Resolution Policy" and "Domain Name Dispute Resolution Rules". As set out in those documents, in order to succeed in the Proceeding, the Complainant must prove, on a balance of probabilities, that:

• a) the Registrant's dot-ca domain name is Confusingly Similar to a Mark in which the Complainant had Rights prior to the date of registration of the domain name and continues to have such Rights; and
• b) the Registrant has registered the domain name in bad faith; and the Complainant must provide some evidence that:
• c) the Registrant has no legitimate interest in the domain name.

The onus then shifts to the Registrant to prove that it is more likely than not that the Registrant has a legitimate interest in the domain name.

Initiate A Court Proceeding

You may also have a potential cause of action based on an infringement of a trademark. The definition of a trademark is a word, symbol, picture or get-up used to distinguish the goods or services of one person from those of others in the marketplace, that is to identify the source of such goods or services. A trademark does not have to be registered to be protected. Your claim may also include a claim for passing off. The aim is to protect the goodwill symbolized by a trade name or a trademark. Passing off occurs when one entity misrepresents its goods, services or business as those of another causing damage to the business or goodwill of the latter.

In a passing off action, the plaintiff must prove the existence of a business in which there is a reputation and that the conduit for that reputation resides in the association of a trademark or trade name, that there has been a misrepresentation and that there is a likelihood of damage. An action for passing off can be brought on the basis of the common law tort or (if the trademark is registered) on the basis of the federal Trade-marks Act.

But Remember, Move Quickly

The most common remedy sought is an injunction prohibiting the violating party from using the name and/or the transfer of the domain name. You have to proceed with haste to show that you really are concerned with the potential damage so, move quickly! Bill and Ted did.

Patricia Skringer
Litigation Group
Tel: 905.276.0403
E-mail: pskringer@kmblaw.com

The comments in this newsletter are of a general nature and are not designed to replace professional advice in specific situations. If you would like extra copies of this newsletter, or you know of anyone who would be interested in joining our mailing list, please contact Cheryl Woolcott at (905) 276-9111.