Wednesday, 3 February 2016

STEPHEN KOEING VS ARBITRATOR NIXI AND ANR


The National Internet Exchange of India ( hereinafter “NIXI”), registered on 19/6/2003 u/s 25, Companies Act, 1956 as a Governmental non-profit organisation, falls under the Ministry of Communication & IT under the Department of Electronics & Information Technology. NIXI was established for peering of ISPs for routing the domestic traffic, better quality of service, reducing latency and bandwidth. Since 2005, NIXI manages the .IN Registry ensuring operational stability, security and reliability of the domain names ending ‘.in’. .IN domain name disputes are resolved by the .IN Dispute Resolution Policy (hereinafter “INDRP”) and INDRP Rules of Procedure. The other domain name disputes are resolved in accordance with the Uniform Domain-Name Dispute-Resolution Policy (hereinafter “UDRP”). The present case deals with the dispute between a domain name and a trade mark. It also talks about the distinction between the two above mentioned policies and the different domains that they are applicable in.

Facts:
1.      Purohit applied under the Trademarks Act, 1999 ("the Act") on 17.03.2003 to register the trademark 'internet' relating to 'Tobacco, raw or manufactured, smokers’ articles, matches included in Class 34. The trademark certificate, issued on 13.07.2005 as per Section 23 (1) of the Trademarks Act, related to the application date. The Sunrise policy and secured domain name registration benefits using trademark were not availed. 

2.      NIXI issued "Sunrise Policy" for Indian registered trademark proprietors willing to protect their marks, .IN domain names, before the general public. The rationale was preference to Indian persons over foreign entities. Indian trademark proprietors' applications were to be submitted to the Registry through an accredited Registrar. Applications were accepted from 01.01.2005 to 21.01.2005.

3.      Koening, a U.S.A resident, had domain name 'internet.in' registered with the .IN Registry on 16.02.2005. On 31.01.2006, Purohit filed a complaint with the .IN Registry seeking cancellation of the registration of the domain name 'internet.in' of Koening. Purohit had used the trademark 'internet' beyond three years. The domain name 'internet.in' was confusingly similar to his trademark. Koening had- allegedly, registered in the .IN Registry, several domain names with no right or trademark like air.incomputer.in, etc. His intentions were selling the domain name to Purohit or another organization. Purohit alleged that Koening had parked the domain name and made money by luring customers to the website and tricking them into clicking on ads.

4.      Purohit filed a complaint with the .IN Registry seeking cancellation of the registration of the domain name 'internet.in' of Koening. Thereafter the arbitration on the lines of INDRP was initiated on the request of Koening.

5.      The Arbitrator, in the Award dated 05.07.2006, held:
(a) The domain name 'internet.in' of the Koeing was identical and confusingly similar to Purohit's trademark. Purohit (Complainant) did not establish his trademark over a generic word;
(b)  Koeing had no right over the domain name;
(c)  Koeing registered the domain name 'internet.in'  maliciously.
(d) Koeing was not entitled to retain the domain name. It was to be cancelled from Registry;
(e) Purohit was not entitled to transfer the domain name in his name. His bona fide rights were not established;
(f)  Koeing could not, allege reverse domain name hijacking by Purohit.
(g) The .IN Registry should confiscate 'internet.in'.

6.      Koening then moved to the Delhi High Court; the impugned order assented the arbitrator's finding. The fact was the goods for which Purohit held registration were not internet related services which Koening proposed to offer using the domain name. The impugned order stated that in e-commerce confusion can be caused.

7.      The learned Single Judge dissented the arbitrator’s conclusions in one issue:  Purohit did not establish legitimate interest over the term 'internet'. The learned Judge concluded that the arbitrator found the word generic without trademark rights. The reasoning was, as Purohit held a valid registration over the said mark, which went unchallenged by the Koening, the former's rights over the mark stood established. 

8.      The main contention of Koening was that the INDRP itself states that it is modelled in the line of the UDRP and to carve such a distinction between INDRP and UDRP as done in the impugned judgment is contrary to the intention and purpose of the INDRP.

Issues:
1.      Whether UDRP conditions are to be read into INDRP provisions?
2.      Whether the registration of a trademark, indicates an interest on the part of the Respondent (Purohit)?



Decision of the Court

1.      The Hon’ble Court found Koeing's submission that the UDRP conditions should be read into the INDRP provisions, unpersuasive. INDRP applies; its provisions were to be considered by the arbitrator in the present case undisputedly. UDRP is not umbrella legislation or constitutional instrument, to subordinate INDRP in norms’ hierarchy. Neither have force of law. Instead, since INDRP is the enforcement mechanism of norms governing NIXI, they constitute the norms applicable.  Nothing in the INDRP text supports the Koeing’s contention; there is no other compulsion.

2.      About a trademark registration, having no legitimate interest of Purohit; the court said that without conditions to execute trademark registrations’ search could not, according to Koeing, prejudice him. A trademark registration depends upon statutory conditions’ fulfilment, subject to the mark not falling within disqualifying conditions or disallowed in use and on the basis of its use, or proposal of the applicant to use it, subject to conditions. Therefore, Koeing’s contention that registration does not confer legitimate interest is unacceptable. In this context, the learned Judge used the case Satyam Infoway v. Siffynet Solutions (P) Ltd.; Indian trademark law would apply for domain name use, wherever confusion or similarity issues arise between web services or domain names usage.

3.      The Court noticed that, the arbitrator and the Judge found that Purohit had discharged the onus upon him showing that Koeing had no legitimate interest in .IN. He failed to prove the existence of  ingredients such as " use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services", that he is "commonly known by the domain name even if he has no trademark" or that he is "making a legitimate non-commercial or fair use of the domain name." These findings are fact based and not reviewable in appeal under Section 37.

4.      The Court noted, INDRP dispute resolution mechanism through arbitration falls within under an arbitration agreement u/s7 of the Arbitration and Conciliation Act, 1996. Therefore, awards made under the INDRP framework shall be tested under the law applicable for S. 34, the courts have limited powers to interfere with arbitral tribunal's determinations: if the findings are upon patent legal errors, or contrary to contract terms, or are unreasonable would interference happen.

Critique:


The judgment stands for future disputes regarding dispute resolution of NIXI regarding .in’ and other domain names. The judgment supports the distinction between INDRP and UNDRP provisions as the learned Judge created. The application reading INDRP provisions with UNDRP provisions was wrong. A party cannot use any non-applicable law to favour its case nor can it force the courts to do so. The case also very clearly affirms that the dispute resolution with respect to INDRP falls within the ambit of the Arbitration and Conciliation Act, 1996. Therefore we can conclude that it can be an appealable order u/s 37 of the Arbitration and Conciliation Act, 1996 and can be appealed against if it satisfies the conditions therein. 

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