Issue # 1: Protection of Domain Names
Among the earliest and most important steps taken by any e-commerce business is the selection and registration of a domain name for its website. The Internet has no comprehensive index of IP addresses and the companies with which they are associated. A domain name that customers strongly associate with the products or services provided by the e-commerce business permits Internet users to easily locate the company on the web by simply "guessing" its address. Since the domain name is how most customers will remember the business’s web location, its importance to a company who transacts business primarily over the Internet is obvious and undeniable.
Most businesses register a domain name in one of the three most popular top-level domains (.com, .net, or .org). Within each top-level domain, each domain name is unique; there is, for instance, only one www.ecommercelaw.typepad.com (which includes both a second-level domain, "typepad," and a third-level domain, "ecommercelaw"). However, one may duplicate part of a domain name registered in another top-level domain; for instance, there could be (but is not yet) a www.ecommercelaw.typepad.net.
Once an e-commerce business becomes successful, its domain name becomes a valuable asset in directing customers to its website and, therefore, has the direct effect of increasing revenue. In essence, the domain name itself becomes a valuable asset of the e-commerce business.
In the case of a domain name that becomes very well-known, other individuals and businesses may use derivatives of the well-known domain to drive traffic to their own commercial websites. A business seeking to reduce this risk, and protect the value of its domain name, may do so by:
- Registering the domain name in all three main top-level domains. Registering the domain name in all three main top-level domains (and any other top-level domains which may provide value) which all direct Internet users to the same website is a relatively inexpensive way to ensure that a variation of the domain name is not used to re-direct customers to another company’s website.
- Registering common misspellings of the domain name. Registering common misspellings of the domain name will help reduce the risk that an Internet user will misspell the domain name and be directed to another business’s website.
- Obtaining a federal trademark registration for the domain name. If a domain name acts to identify the source of products or services (and not merely as an indication of the address of a particular website), it may be possible to register the domain name as a trademark with the United States Patent and Trademark Office. Though federal law protects both registered and unregistered trademarks, the owner of a properly registered mark is afforded additional benefits not available to owners of unregistered marks. Though federal law may protect against some uses of a mark by a party other than the owner, it does not protect against all such uses, as Jerry Falwell recently learned.
"Common Issues Faced by E-Commerce Businesses" is a seven-part series appearing each Tuesday afternoon on E-Commerce Law. Readers are reminded that all of the information on this site is provided for informational purposes only and is not intended to be a substitute for legal counsel. No one should act or refrain from acting on the basis of any content included on this site but should instead seek the appropriate legal advice on the particular facts and circumstances at issue from a properly licensed attorney.
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