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Combating Online Infringement, Dilution and Disparagement of Your Brand

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You've spent years building goodwill in your business and translating it into your brand name. You've registered your brand name as a trademark which you use as the domain name for your company's website. You've invested many thousands of dollars optimizing your website and using it to promote your business. Suddenly you discover that a competitor has registered another domain name that incorporates your trademark and is using it to redirect your customers to its own website. Not only that, but your competitor's website contains misleading comparisons between its products and yours, and false and disparaging statements about your business.  

Nightmare scenarios like this are becoming more and more common.  It is all too easy for a competitor to strategically integrate your branding into their online presence – to ride on your coat tails and/or to disparage your business.

So, what can you do? Fortunately, there are a number of legal remedies available to you. 

Domain Name Dispute Resolution (UDRP and CDRP)

If your competitor has appropriated your brand into a domain name, consider initiating domain name dispute resolution proceedings under the Canadian Internet Registration Authority's (CIRA's) Domain Name Dispute Resolution Policy ("CDRP") (for .ca domain names) or the Uniform Dispute Resolution Process ("UDRP") (for .com and other kinds of domain names). This administrative process is typically a more cost effective and expeditious method for resolving domain name disputes. The CDRP and UDRP provide a legal framework for a trademark owner to have a domain name that is confusingly similar with their trademark cancelled or transferred to them. This kind of relief is available if the following criteria are met:

  1. the infringing domain name is identical or confusingly similar to your trademark;
  2. the registrant of the infringing domain name has  no rights or legitimate interests in the domain name; and
  3. the registrant registered the domain name in bad faith.

There are a number of significant advantages to launching a UDRP or CDRP complaint, mainly, time and money saved. The UDRP process is less formal than litigation, and experts in this field adjudicate the disputes. It is also international in scope, providing a single mechanism for resolving domain name disputes irrespective of where the domain name holder is located.

On the other hand, the relief available through the domain name dispute resolution is limited to cancellation or transfer of the specific domain names at issue. An infringer can always register other infringing domain names and thereby engage the trademark owner in a protracted and expensive game of "whack-a-mole". Moreover, infringing domain name registrants can often establish some arguably legitimate interest in an infringing domain name to avoid cancellation or transfer under the UDRP or CDRP that would be more difficult to establish in a trademark infringement lawsuit.

Bringing an Action for Trademark Infringement or Passing Off

If damages have been suffered or if the infringer seems likely to continue infringing your trademark rights through other domain names or by other means, then beginning a legal action for trademark infringement may be necessary.  A successful suit could result in the payment of damages for harm caused by the unlawful use of your trademark. Suing the unlawful user for trademark infringement may also be necessary to force a competitor to cease all unauthorized use of your trademark or confusingly similar trademarks in the future.

If your trademark is not registered, then an action for"passing-off" may be possible. Passing-off is an attempt to profit from the reputation of an established mark by representing your goods as the goods of another. In the domain name context, Canadian courts have held that mere registration of a domain name that infringes on a common law mark can constitute passing off. A successful action in passing off could result, like a successful trademark infringement action, in the payment of damages by the unlawful user, or in an injunction, requiring the unlawful user to discontinue all unauthorized use of a mark.

Traditional trademark infringement and passing off requires proof that the average consumer will be confused by the infringer's use of your trademark. But what if the infringer's use of your trademark is not confusing since they're only using it to disparage your business? Certain remedies may still be available under the Trademarks Act, including damages where the infringer is using your trademark (so long as your trademark is registered) in a manner that is likely to depreciate the value of the goodwill associated with it.

Bringing an Action for Libel or Injurious Falsehood

Defamation law may also offer an opportunity recover against damage caused to your businesses reputation.  An action in libel, a subset of defamation law will allow you an opportunity to address written words that discredit or injure a company or an individual's reputation.

If your goods have been disparaged or if your competitor's site contains untruthful and misleading content about your business or products, you may consider an action in injurious falsehood (sometimes called "'trade libel") to recover the damage caused by the falsehoods posted. Injurious falsehood is the malicious publication of false information that leads others to act in a manner that causes actual loss, expense, or damage.  While your competitor is legally allowed to compare their product to yours, even if that comparison is unfavourable, they cannot publish untruthful statements about your product or make false comparisons that disparage your goods or services.

Removal, de-listing or de-indexing a website

Under the circumstances you may be asking, shouldn't Google step in and simply remove your competitor's site?  While an infringing domain name will not result in an automatic de-listing of a website, you may consider reaching out to a search provider, and informing them of the illegal content. Taking these steps may motivate the search provider to voluntarily remove, de-list or de-index the infringing domain name. A voluntary de-listing was one result in Niemela v. Malamas, a recent decision of the British Columbia Supreme Court. In that case, Mr. Niemela sought an interlocutory injunction compelling Google Inc. to block 146 URLS from its universal search results for websites containing defamatory comments about Mr. Niemela.  In that case Mr. Niemela was not only concerned about the defamatory statements on the primary websites in issue, but also with the text that accompanies the URLs listed in the Google search results. In the process of the litigation Google Inc. agreed to voluntarily de-list the search results associated with .ca websites.

In some instances a court may even order a search provider to de-index a site.  In Equustek Solutions Inc. v Jack, the Plaintiff obtained an injunction against the Google Inc. (a non party), enjoining it from delivering search results pointing to the defendants' websites which were being used to sell counterfeit versions of the Plaintiff's product. The injunction forced Google Inc. to de-list all clandestine websites, which relied on Google to direct customers to those sites. Taking steps in the course of litigation to enjoin a search engine from continuing to list and index the infringing domain name may be all the force necessary to jettison the infringement.

Next Steps

As you can see there are a number of options available to address a situation where your competitor is free-riding off your hard earned goodwill online or using your trademark to disparage your business. There is no cookie-cutter solution to these issues and the options presented here are often best implemented in some combination simultaneously as a multi-pronged response.

Navigating this rocky terrain can be challenging, particularly when you feel that your brand power is being challenged or threatened. Each set of circumstances and facts will call for a tailor-made solution using any number of the remedies described here, and may require others as well. When faced with these challenges, it is always best to consult with a lawyer who specializes in the field to ensure that you properly protect and enforce your rights to your business' marks and goodwill.

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