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The online world is rife with problems, meaning brand owners should monitor any potential dangers in order to protect their identity says Nick Wenban-Smith of Nominet.
In today’s world it’s almost a given that your branding needs to harness technology to compete effectively.
According to Google, online small businesses grow four times faster than those offline, and Nominet has shown that a majority of people in the UK believe that an online presence will become a company’s most important asset within the next five years.
Unfortunately there is always the risk of stolen intellectual property and people wanting to exploit brand names online. This can happen in any industry. Earlier this year, Californian beauty company Creative Nail Design won a domain dispute case against Arunas Bruzas of London, after it registered cnd-shellac.co.uk and used the domain to sell counterfeit CND Shellac nail polish products.
The final ruling, in March this year, was that the registration was abusive, and the domain was ordered to be transferred to Creative Nail Design.
It’s difficult to say how much of an issue counterfeiting is in any given sector. Over the past year, disputes about domain names falling into the ‘fashion’ category (which includes beauty products) made up only around 5% of all full decisions in Nominet’s Dispute Resolution Service.
Nominet’s last six-month criminal activity report showed 846 .uk domains were suspended for the supply of counterfeit goods and/or fraud.
To put this in context, that is less than one hundredth of one percent (0.01%) of the 10.5 million .uk domains registered.
However, some counterfeiters reap small fortunes from knowingly misleading customers. One of the main dangers for brands is when a fraudster registers web domains using a brand’s name to sell fake products, as was the case with Creative Nail Design.
A brand name is a signal of a brand’s values, and proof of origin and quality for its products and services. If a fraudster is taking advantage of your brand and selling lower quality products in your name, it not only undermines the brand but can also cause real injury to consumers—and their wallets.
While the internet has brought massive benefits and opportunities, the online world is also rife with negative aspects ranging from people acting in bad faith to blatant criminality and fraud. It is therefore important to maintain constant vigilance in monitoring your brand online. Here is some advice for brand owners to ensure they do not fall victim to online fraud.
What’s in a name?
Think very carefully when choosing a new brand name, and always carry out plenty of due diligence during the decision-making process. Taking the time to identify a distinctive online identity to avoid future legal problems is far more effective and a lot less stressful than costly disputes and potentially having to rebrand at a later date. A strong brand identity is key, and the more effort a company makes to enhance it, the easier it is to protect.
“Any type of formal action will require the brand owner to prove its case and demonstrate that it has the evidence to back up any complaints.”
Once selected, ensure you register your brand name as a trademark in your key markets. The UK Intellectual Property Office and its EU (Office for Harmonization in the Internal Market) and US (US Patent and Trademark Office) equivalents all have free online access to databases or registered trademarks. Seek professional advice from a friendly trademark agent or IP solicitor if you need it.
The current hot topic in domain names is the expansion of top-level domains (TLDs).
Historically the only choice was a small number of three-letter TLDs such as .com and .org or a two-letter country-code top-level domain such as .uk or .nl. As of mid-January 2015, ntldstats.com (which provides a breakdown of new gTLD statistics) reported a total of more than four million new gTLD domains registered. Registration of your trademarks with ICANN’s Trademark Clearinghouse will not block registration by third parties, but will give early warning in the event that a registration is made in one of the new TLDs that exactly matches your trademark.
A common tactic employed by criminals is to misspell a brand name to trick consumers into thinking they’re on a legitimate brand’s web page.
The use of hyphens or added words or numbers is also a common technique, making the brand name look genuine to those unfamiliar to the real web domain. For example paypa1.com and paypal.com can look very similar in most browser bars. For that reason you should be very wary about responding to unsolicited email, and especially of clicking hyperlinks to new websites.
If consumers are unsure about whether a site is genuine or not, a good tip is to look up the contact page on the website and check the address or phone number given. Beware that criminals have been known simply to copy a genuine site, including the contact pages and so don’t hesitate to make a call or two if in any doubt.
Another clue is to check the email address the site owners are using. The site may look like a very good imitation of a genuine brand but a free generic email address will often give away that it is not the real deal. Finally, official websites for consumer goods often provide resources to identify whether resellers are genuine or not.
Constant vigilance
Although counterfeit cases are straightforwardly malicious, sometimes innocent confusion between similar goods and services can happen. It’s therefore important to regularly monitor your brand online—or hire the services of a specialist brand protection company to do it for you. Alternatively, you can simply regularly monitor search engine rankings yourself and keep an eye on any complaints or social media postings.
If you do encounter counterfeit activity, report the site to the relevant law enforcement authority, starting with the police.
You’ve picked a good name and you monitor it closely, but unfortunately you have identified a problem. You now need to assess your options. First, is the behaviour you have found losing you sales or otherwise confusing your customers? It may be worth keeping a watching brief on low profile or very minor or arguable infringements, and more cost-effective to actively promote your brand as a response.
Even if you don’t take immediate action, take screen shots of any website, search engine results and domain registration records. Evidence is vital and any type of formal action will require the brand owner to prove its case and demonstrate that it has the evidence to back up any complaints.
If you do proceed with a dispute, contact the registrar of the website as it may take immediate action if it feels the website is in breach of its terms and conditions, which will almost certainly cover criminal activity and IP infringement. The next point of call is law enforcement, where all evidence will need to be provided.
Most important, don’t panic. If someone registers a .uk domain name using your brand name, it should be a relatively simple administrative dispute resolution process.
There are huge possibilities and opportunities for brands online and we shouldn’t forget the positive points of the fast-moving digital age we now live in.
Yes, there are risks inherent to working online but if the right steps are taken and you are aware and prepared for any fraudulent activity that may occur, then you will be in a good place to succeed and grow your business.
Nick Wenban-Smith is senior legal counsel at domain name registry Nominet. He can be contacted at: nick.wenban-smith@nominet.org.uk
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