Hartz & Moreillon: Reclaiming the web: Three ways to combat counterfeit websites

We have all come across counterfeit websites while scrolling the web, but what do you do as an attorney if your client or their goods are being impersonated on such a site?

In this article, we will explore three options to shut down an offensive website: (1) remedies through the Digital Millennium Copyright Act, or DMCA; (2) remedies through the Uniform Domain-Name Dispute Resolution Policy, or UDRP of the Internet Corporation for Assigned Names and Numbers, or ICANN; and (3) dispute or complaint reporting services provided by some domain registrars.

Before we dig in, some basics on the vocabulary. Hundreds of companies are licensed as “registrars” of internet domain names, authorized to manage domain name assignments to “registrants,” who in this case are persons or entities operating an accused website.

However, the identity of a registrant is often hidden because many registrars allow for a “private” registration that masks the identity of the real registrant/operator, or the accused registers through a third-party. In addition, other parties may be involved in operating an accused website, such as a hosting service, but most legal procedures (and the rest of this article) focus on the registrant and registrar.

Option 1: DMCA

Remedies to remove counterfeit websites under the DMCA are rooted in ownership of copyrighted materials (the “C” stands for copyright!). If a copyright owner believes their rights have been infringed by a counterfeit website but the registrant is unknown, you can use the DMCA to obtain a subpoena directed to the service provider of the domain in question to acquire information on the domain registrant (i.e., the alleged infringer).

With this information, copyright owners can send out demand letters to the registrant and registrar or take advantage of the DMCA’s notice-shifting provisions. The DMCA allows a copyright owner to send notice to the service provider/registrar informing them of the alleged infringement.

In order to avoid liability themselves, service providers are incentivized to respond expeditiously to remove the content. Once removed, the accused can submit a counter-notice stating, under oath, that the material was incorrectly removed, but also requires the accused infringer accept service of process.

The DMCA then instructs the service provider on next steps. If the copyright owner brings an action to restrain the accused infringer by court order, then the accused material does not need to be replaced on the service provider’s system or network. If, however, no such action is taken then the service provider is required to restore the allegedly infringing material.

Option 2: UDRP

Unlike the DMCA, remedies under the UDRP are rooted in trademark law. Internet service providers are also required to adhere to the UDRP policies, ensuring jurisdiction over the infringing material.

If the counterfeit website has a confusingly similar domain name to your client’s registered trademark, the UDRP allows for cancellation, suspension, or transfer of the domain name by agreement, arbitration, or court order. The most practical approach is to submit a complaint to a third-party arbitration service, such as FORUM.

In order to succeed under the UDRP, three elements must be met: (1) the domain name is identical to or confusingly similar to a trademark or service mark; (2) the alleged infringer has no legitimate rights or interest in the domain name; and (3) the domain name was registered in bad faith.

Under the first element, additions of generic words (such as “the”, or “shop”), pluralizing words, or the inclusion of a top-level domains (“.com”) does not defeat confusing similarity. The second element will not be met if the accused infringer is running a legitimate business using that name or if the domain name matches their legal name, for example. For the third element, bad faith, can be shown where the accused infringer is trying to make money off of using your client’s trademark or service mark or goodwill. However, if monetary gain is not present, this may be the most challenging element to prove.

In the case of a counterfeit or knock-off website, most of these elements can be proven simply by showing the similarities between the domain name and the trademark, and showing the alleged infringer is purporting to sell your client’s goods or services.

While the UDRP does allow the accused infringer to respond to the complaint, most foreign knock-off website owners fail to do so, resulting in default. However, default still requires the trademark owner to establish all three (3) elements based on the allegation in the complaint.

An important limitation to UDRP practice is that the claim is based on, and relief limited to, domain names only. Therefore, infringing content that is offered through other (non-similar) domains or online marketplaces will have to be addressed through other means.

Option 3: Registrar complaints

Some registrars provide forms and processes for submitting complaints directly. The terms and types of claims that can be brought vary with each particular service, but this can be a quick, inexpensive, and effective option if the infringing website happens to be registered with a registrar that has these procedures.

While formal procedures under the DMCA or UDRP may provide certainty, that will come at the expense of, well, expense, and potentially significant delays. On the other hand, informal private complaint processes can result in shutting down the accused website in as little as one day.

One disadvantage to the registrar-based challenge is that you are beholden to the registrar’s process and the presentation of your case is limited, probably just clicking “submit” on a web form (with character-count limits) and maybe a few attachments (with limited file sizes or page counts).

Further, a private dispute policy may change over time so that by the time you are targeting a repeat offender (or pursuing a case for another client), the rules and enforcement may have changed. Further, a dedicated infringer could catch on and shift to using registrars without such policies the next time they stand up a knock-off site.

Which option is best for my client?

This question really comes down to the facts of the offending website and your client’s rights and interests. If you are lucky and find yourself dealing with a registrar with its own complaint process, that has the potential to provide an immediate result that hopefully eliminates the need to proceed with more complex enforcement mechanisms. Otherwise, if your client has only copyright rights or trademark rights, then the option is all but selected for you.

If your client, like most, has both copyrights and trademarks, then you must determine if the domain name is confusingly similar to your client’s trademark(s). If so, proceeding under the UDRP first will be quicker and more cost-effective. Many foreign counterfeit website owners fail to respond to complaints and do not arbitrate. Also, the entire counterfeit website will be transferred to your client, preventing any further infringement from that domain name.

That being said, operating under the DMCA will likely apply to most every case, as the range of your client’s works protected under copyright may be much broader, such as product photographs and descriptions, website artwork and design features, or catalogs and instruction manuals.

So long as there is copying or sufficient evidence to allege copying, then your client can proceed under the DMCA. The drawbacks here lie in the possibility of only removing infringing material, as opposed to the entire website, which may depend on the extent of copying and whether or not the accused infringer contests the claim.

Before pursuing any of the above options, it is important to document the accused infringements and try to identify all relevant parties, which may include the registrant, registrar, hosting company, or other internet service providers.•

__________

Blake Hartz is a partner and Shane Moreillon is an associate at Woodard, Emhardt, Henry, Reeves & Wagner LLP. Opinions expressed are those of the authors.