Dealing With Internet Theft in the Travel Industry
September 10, 2009
Thomas P. "Tom" Arden- Chicago
Of the many industries engaged in commerce on the Internet, the hospitality industry is one of the most active. Websites for hotels, vacation packages and travel generate sales as a distinct distribution channel, provide promotional and advertising venues, and provide reference sources for potential customers and travel agents. In effect, the hospitality industry was even granted its own top-level domain extension in 2004: “.travel.”
Widespread Unauthorized Use of Trademarks
Along with these commercial benefits come headaches, however. Due to the travel industry’s traditional reliance on distinct intermediaries and the amount of travel business conducted on the Internet, brands are routinely misused. Travel agents and tour operators in particular have engaged in massive theft in selling vacation products of travel suppliers by using suppliers’ names on website pages in a prominent manner, in domain names, in search-engine sponsored links or “key words,” and as metatags. Website entrepreneurs seeking fees for referring Internet travel purchasers to authentic sites through the use of links on their sites also are a common source of trademark theft.
There are two ways of dealing with unauthorized trademark use in the hospitality industry: (1) issuing proactive educational guidelines and regulations to travel partners and (2) initiating legal actions. The following is a general overview describing ways to combat the misuse of names and marks by travel intermediaries and how to institute actions against domain name theft.
Distributing Guidelines and Regulations
Travel agents may not realize they are violating trademark rights in their use of proprietary marks. Because they often specialize in the sale of vacation packages or hotel stays of a certain company, use of that company’s name and mark may actually seem logical to many travel agents. It is therefore helpful to formulate and distribute guidelines to travel agent and tour operator customers educating them on how proprietary marks may and may not be used.
The educational guidelines should generally describe lawful “fair use” of a mark to identify what a vacation package comprises or the providers of travel services. At the same time, the guidelines should explicitly prohibit the use of marks in domain names or metatags and prohibit the purchase of sponsored links using a key word featuring a company brand. In addition, the guidelines can govern the display of a mark on a website by prohibiting its use by itself or as part of an agency’s name. The guidelines can specify that a mark cannot be shown in type larger than the agency’s own name and require the use of a legend disclaiming connection to a travel company. Other provisions on email marketing and physical signage are helpful in specifying the rules of the road for travel agents and tour operators on the use of travel company brands.
The guidelines should be distributed directly to travel agents and tour operators. They can also be posted to the travel agent sections of websites.
Legal Actions to Regain an Agent’s Domain Name Registration
In cases where guidelines and warnings do not prevent domain name theft, a U.S. brand owner has two avenues available to regain an infringing domain name. One avenue is to file a civil action under the federal Trademark Act, particularly the Anti-cybersquatting Consumer Protection Act, codified under Section 43(d) of the Trademark Act. This provision, added in 2006, provides for domain name transfers and potentially significant statutory damages and attorney fees awards.
The second available avenue is a unique procedure brought under the Uniform Domain Name Dispute Resolution Policy (UDRP). The UDRP process has been available to remedy domain name theft since 1999, when it was adopted by the Internet Corporation of Assigned Names and Numbers, known as ICANN. It applies to all domain names with generic top-level extensions such as “.com,” “.org” and “.net.” With a few exceptions, it does not apply to names with foreign country extensions.
Dozens of travel industry companies have retrieved their domain names through the UDRP process. Hundreds of domain names infringing the marks of hoteliers, resort managers, air travel companies and tour operators have been transferred under this procedure.
The popularity of the UDRP is due to several benefits:
- The process is rapid, relative to a court proceeding; a panel usually issues a decision eight weeks after a complaint is filed.
- Numerous domain names can be secured in one proceeding. This has proved beneficial in a number of cases involving travel brands, as travel agents and intermediaries often register multiple domain names using several different travel company names and marks.
- Residents of foreign countries who register applicable domain names are subject to the same process as U.S. citizens. Because the UDRP rests on the contractual obligation of all registrars to transfer domain names after a decision ordering a transfer, there are no jurisdictional questions or questions of enforcement of the UDRP order in a foreign country.
- Because there is no discovery or testimony, attorney fees are not excessive.
There are some drawbacks to the UDRP, however. The policy requires that the trademark owner prove the domain name registrant registered and used the mark in bad faith, a more difficult task than simply showing trademark infringement. The decisions are also made by independent lawyers, who often are not as qualified as federal judges to decide cases.
Perhaps the most significant concern in utilizing the UDRP is its appeal process. Any registrant ordered to transfer a domain name may appeal the decision in court within 10 days of the date of the decision. In the United States, delays caused by challenges to a UDRP decision that are filed in state court in particular can lengthen the otherwise quick remedy of the UDRP.
Cases involving foreign domain name registrants present stickier situations in appeals. In filing a UDRP complaint, the trademark owner must agree that an appeal of the decision can be filed either where the registrant resides or where the registrar is located. If both the registrant and registrar are located in the Far East, for example, the owner of the U.S. trademark cannot object to jurisdiction of a case appealing a transfer order filed there. Not only could an appeal be heard thousands of miles away from the brand owner’s place of business, the proceeding very well could be governed by foreign law. In such a case, foreign law may not recognize the brand owner’s rights if it does not own a registration or do business in the foreign country. In this way, the benefits of the UDRP can turn into a disadvantage in cases with foreign registrants and registrars; while enabling the brand owner to obtain jurisdiction in a forum over an infringing domain name, it also forces the brand owner to agree to jurisdiction it otherwise would not face.
Despite these concerns, the UDRP represents a powerful instrument to combat some of the problems resulting from expanding online travel commerce. With carefully constructed, informal guidance, travel companies can effectively prevent and remedy the often overwhelming misuse and theft of trademark rights.
Related Practices