Tuesday, June 14, 2005

Web Agencies liable for trademark infringements on .it Domain Names

A recent ruling of an Italian court has caused turmoil in the online industry. A maintainer was tried and found guilty of setting up a domain name on behalf of a customer, who was infringing trademark laws of a well-known enterprise operating in Italy.

In the online search industry the domain name may become a relevant part of the search strategy: keyword-rich domain names have been known to be favoured by search engines, giving them the ever-so-slight advantage on competition. It is not uncommon to seek a local presence by setting up a new local domain to acquire visibility.

The procedure to set up an .it domain name involves 3 parties:
  • The Italian Registration Authority (NIC.it)
  • A Provider/Maintainer
  • The end user
A maintainer is typically a web agency or internet provider who deals directly with NIC.it. The end user is required to undersign a formal request of activation (called la lettera di assunzione responsabilità). The maintainer is required to follow a technical procedure to finalise registration.

The provider/maintainer, formally considered neutral in the process, is now held responsible and accountable for damages caused to others should infringements on registered trademarks be raised by a 3rd party.

The court identified providers/maintainers as an active party in setting up a domain name. By registering a domain name that relates to a registered trademark, the sentence identified the actions of the provider/maintainer similar to those of a “counterfeiter”.

The judge defined domain name purchasing as a typical entrepreneurial activity where risk is involved: Providers/Maintainers requesting the activation of a domain name, possibly a registered trademark, are being warned: You are liable for trademark infringements in Italy.