Transfer of domain name to foreign party upheld

A Korean district court has held that an individual had registered and used the domain name 'celluarsouth.com' in bad faith (Case 2009Gahap132, April 21 2010).

A number of Korean domain name registrants have filed civil actions in the Korean courts against decisions rendered under the Uniform Domain Name Dispute Resolution Policy (UDRP). According to Korean Supreme Court precedent, the courts have reviewed these cases under the relevant laws, but not the UDRP. Since the Internet Address Resource Act (IARA), which provide protection to domain names in Korea, was amended to cover generic top-level domain names as of September 10 2009, a UDRP petitioner may now raise a claim under the IARA, in addition to the Trademark Act (which requires registration of a mark in Korea) and/or the Unfair Competition Prevention and Trade Secret Protection Act (which requires that the mark has achieved well-known status in Korea).

The IARA prohibits "registering, maintaining or using a domain name in bad faith for the purpose of preventing a legitimate right holder from registering the same or of obtaining an unlawful gain from the right holder". In this regard, a district court recently held that a foreign party's legitimate right in a domain name and the registrant's bad faith can be recognised only based on evidence originating from abroad.

In the present case, the complainant (a Korean individual) registered the domain name 'celluarsouth.com' in 2005. The website attached to the domain name was used to provide links to cellular phone services. The defendant, a US company, had registered CELLULAR SOUTH as a US trademark in 1989. It provides cellular phone services on its website at 'cellularsouth.com'. The defendant filed a UDRP complaint and the panel ordered the transfer of the domain name to the defendant. However, the complainant filed a civil action before the district court to prevent the UDRP decision from being implemented.

The district court held that the term 'celluarsouth' in the complainant's domain name was confusingly similar to the defendant's CELLULAR SOUTH mark, since:

  • only the letter 'L' was missing in the domain name; and
  • a number of internet users wishing to access the defendant's website were likely to access the complainant's website by mistake.

In view of this, the district court held that the complainant had registered and used the domain name in bad faith to divert the defendant's customers to other websites providing similar services for the purpose of obtaining unjust profits, without having a legitimate right to the domain name. The complainant argued that the defendant had no trademark right in Korea and that its mark was not well-known in that country. Therefore, the defendant was not a legitimate right holder under the IARA. However, the district court dismissed this argument, stating that there is no requirement under the IARA that the legitimate right owner have a registered trademark or that the mark be well-known in Korea.

Cecile Su-Jung Kwon and Gavin Healy, Kim & Chang, Seoul

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