Satyam Infoway Ltd. v. Sifynet Solutions Pvt. Ltd.

Relevant Acts and provisions

Trade Marks Act, 1999

Section 27(2)

Provisions considered: Common law passing off, read with Section 27(2) of the Trade Marks Act, 1999.

Brief facts

Satyam Infoway Ltd., an internet service provider that had registered and used domain names incorporating a coined word since 1999, sued the respondent after it began using deceptively similar domain names for similar internet services. The trial court granted an interim injunction in the appellant's favour, but the Karnataka High Court vacated it, holding that the parties operated in different lines of business and that passing off did not readily extend to domain names. Satyam Infoway appealed to the Supreme Court.

Issues before the Court

1. Can domain names be treated as trade marks and protected against passing off under Indian law?
2. Did the respondent's domain names create a likelihood of confusion with the appellant's prior domain names?
3. Was the High Court right to vacate the trial court's interim injunction?

Court's findings

The Court held that although the Trade Marks Act, 1999 does not expressly deal with domain names, the growth of electronic commerce means a domain name is used and perceived not merely as an internet address but as a source and business identifier, and is therefore susceptible to the same legal norms as trade marks, including the tort of passing off.

The Court found that the appellant had established prior use, reputation and goodwill in its coined word since 1999, and that the respondent's adoption of a nearly identical name for functionally similar internet services was likely to deceive an average internet user into believing the two enterprises were connected. It held that the respondent had given no satisfactory explanation for its choice of name.

The Court accordingly held that the High Court had erred in vacating the interim injunction and that the classic elements of passing off, namely goodwill, misrepresentation and likelihood of damage, were made out.

Decision

Appeal allowed; the High Court's order was set aside and the trial court's interim injunction restored.

Keywords

Deceptive Similarity Domain Names Goodwill Online Infringement Passing Off