Federal Court considers whether use of domain name resolving to website is trademark use

The recent 650-paragraph judgment in Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd ([2015] FCA 554) presents a smorgasbord of trademark law issues with some consumer law for dessert. Perhaps suffering from indigestion, his Honour commented on the disproportionate amount of resources expended on this dispute. This article focuses on selected issues.

Cairns Harbour Lights Pty Ltd (CHL) was the developer of an apartment building in Cairns known as 'Cairns Harbour Lights' or 'Harbour Lights'. Some apartments were let on a short-term basis.

In 2009 CHL applied to register two word marks, HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS, in relation to "commercial real estate agency services", "hotel services" and "leasing, letting and rental services". Registration was granted.

Apartment owners were free to use any letting agent, but CHL granted Accor exclusive rights to operate a letting service on-site, and an exclusive licence to use the trademarks.

In 2007 an apartment owner started her own letting agency using 'Harbour Lights' and 'Cairns Harbour Lights', and later sold her business to one of the respondents, Liv Pty Ltd.

The CHL and Accor sued the apartment owner and Liv (and its director) for trademark infringement and misleading and deceptive conduct. The respondents cross-claimed that CHL was not the owner of the trademarks and sought rectification of the Trademarks Register.

The respondents succeeded in the rectification claim with respect to the CAIRNS HARBOUR LIGHTS mark for all services, and with respect to HARBOUR LIGHTS other than for "commercial real estate services" and "hotel services".

CHL and Accor succeeded on infringement in relation what was left of the trademarks, and (on a limited basis) in the misleading and deceptive conduct claim.

If a mark has not been used prior to filing, the registrant is deemed to be the owner. If a mark has been used prior to filing, the owner is the party who first uses the mark for relevant goods/services.

Both sides had challenges in that they had variously used the relevant words in a merely descriptive sense, but not 'as a trademark', and had not necessarily used exactly the same words as the registered trademarks.

However, both sides had used the marks in their respective domain names, resolving to their respective websites where various services were offered. Adopting an analogy between a domain name directing people to a site and a sign on a shop front, Justice Rangiah followed previous cases (here and here) finding that, if a registered domain name resolves to a website that promotes goods or services, that will be use as a trademark in relation to those goods or services. Other uses had been made in other marketing materials. Some uses were held to be merely descriptive of the property – ie, merely using its name as an identifier – but other uses were held to be trademark use in respect of relevant services.

The respondents were able to show first use in respect of the majority of services the subject of the registrations. Accordingly, the CAIRNS HARBOUR LIGHTS registration was limited to certain services – "commercial real estate services" and "hotel services". The registration for CAIRNS HARBOUR LIGHTS was held to be totally invalid, on the basis that that particular mark was insufficiently distinctive.

For the services that remained validly registered, the respondents were held to have infringed. Most interestingly, infringement was held to extend to the appearance of the trademark in Google search results (not just sponsored links). His Honour held that the respondents had caused an infringing statement to appear in the search results, and that constituted infringing trademark use by those respondents.

Accor gave evidence that people who had booked through the respondents' business would often show up at Accor's reception desk, trying to check-in, or requesting use of services Accor provided to its guests such as room service, pool towels, onsite luggage storage and newspapers. His Honour found, however, that that was not a consequence of misleading and deceptive conduct by the respondents, save to the extent that the respondents had included listings on various websites such as 'hotelclub.com' and 'expedia.com.au', which contained references to 'Hotel Policies', 'Hotel Features' or 'In the Hotel'. Those listings were found to be misleading and deceptive because they represented to customers that they were booking a hotel room (which in turn led to the expectation of a reception desk, room service and so on) when really they were booking an apartment.

The case is a reminder that use of a domain name which resolves to a website promoting the user's goods or services will probably amount to trademark use.

The case is also a timely reminder of the benefits of filing a trademark application before one commences relevant use – in this case use by a third party before the filing date, and before the first use by the applicant, caused the marks to be removed from the register for some services.

Tim Golder, Sarah Matheson and Grace Walton, Allens, Melbourne