S A T Y A M I N F O W A Y L T D . V . S I F Y N E T S O L U T I O N S P V T . L T D .


Co- Authors:

K. Sreeya Choudhary,Gitam University, Visakhapatnam

Shraddha Sharma, Jamnalal Bajaj School of Legal Studies, Banasthali Vidyapeeth

Vihaan Kumar,Vivekananda Institute of Professional Studies


Editor: Kanhaiya Singhal,Faculty of law, PES University

CITATION: AIR 2004 SC 3540

PETITIONER: Satyam Infoway Ltd.

RESPONDENT: SIFYNET SOLUTIONS Pvt. Ltd

BENCH: Ruma pal J., P.Venkatarama Reddi J.

DATE OF JUDGMENT: 6th May, 2004

FACTS

The Respondent (Sifynet solutions) had registered domain names www.siffynet.com and www.siffynet.net which were similar to domain name sifynet.com of the Appellant (Satyam Infoway). Satyam Infoway was a leading IT service company incorporated in 1995. It had a good reputation in the market. It had registered various domain name in June 1999, with ICANN (Internet Corporation for Assigned names and numbers) and WIPO (World Intellectual property organization).

The Respondent began doing the business in 2001 June and also registered two domain names with ICANN. After knowing this Satyam Infoway filed a suit in city civil court, Bangalore. The court decided in favor of Appellant. The aggrieved respondents then approached the Karnataka High Court. Later the case was heard in the Apex Court.


ISSUES

1. Whether domain names are valid under the intellectual properties?

2. Whether the principles of Trademark Act, 1999 apply?

DISCUSSION: CONTENTIONS BY BOTH THE PARTIES SATYAM INFOWAY LIMITED The appellants, Satyam Infoway Ltd., claimed that the similarity in the domain name of the appellants and the respondents, Sifynet Solutions Pvt. Ltd., would cause confusion in the mind

of the relevant customers who seek their services as the customers can mistake the services of the respondents as that being offered by the respondents. They also claimed that they were the first Indian internet company to be listed in NASDAQ and it trades under the domain name “sify” and that they had used the domain name widely and extensively for all their software services. They were the largest internet provider in India with more than 5 Lakh subscribers. Their shares have been actively being traded in the NASDAQ exchange since 1999 under the same domain name. SIFYNET SOLUTIONS PVT. LIMITED: The respondent claimed that any confusion for services would be unlikely since both parties provide services in different fields. The respondents then went on to contend that the domain name registration did not endow to an intellectual property right in name, like trade mark. They maintained that a domain name is equivalent to an address on the computer. Further contention was that a domain name acts a means of communications between consumers and the owner of the business and does not endorse any property rights in the process. JUDGMENT CIVIL COURT The court noted that the appellants had earned a good reputation for the services they provided under the domain name “sify”. The respondent’s domain name was deceptively similar to the appellant’s domain name and it could cause confusion to the relevant customers. The order was in the favor of the appellants and a temporary injunction was granted to them against the respondents. HIGH COURT The court noted that the services provided by the Appellant and the Respondent were not the same, moreover the respondent had enrolled 50,000 members to their business after investing a large amount of money into it. The court was of the opinion that the balance of inconvenience was in the favor of the respondents as the respondents would have to put with greater monetary injuries. The order of the civil court was ruled out. SUPREME COURT

The court held that the domain names fell within the ambit of Trade Marks Act since a domain name was inclusive of all the characteristics of a trademark. The court held that allowing the respondent to further use the domain name “siffy” it would create confusion in minds of the general public seeking the services of either of the parties. The court also noted that a relevant consumer may, upon entering the wrong website, think a case of misrepresentation of claims by either of the parties. This could harm the goodwill and the brand name of both parties. The court granted an injunction in the favor of the appellants and the respondents were denied from using the domain name for providing services as well as for their business transactions CONCLUSION AND SIGNIFICANCE Satyam Infoway Limited v. Sifynet Solutions Pvt. Ltd. was the first case decided by the Supreme Court of India to give a landmark judgment which would affect the way trademarks are perceived in the future. The Honorable Court held that the Indian Trade Marks Act, 1999 should be read as applicable to the regulation of domain names. A domain name, which is assigned to be a unique set of alphabetical order or numbers or a combination of both which replaces the complexity of remembering the large set of numbers separated by dots, is set by this judgment to have all the features of a trademark. The Courts held that the confusion which may arise in the market due to the use of identical or similar domain names to be serious and hence the City Civil Court rightfully in the first case which was filled by the applicant granted a temporary injunction against the disputed domain name to avoid economical loss because a company builds its reputation in the market it serves in a due course of time and due to hard work which shall not be infringed upon by such usage by the respondent company, i.e. Sifynet Solutions Pvt. Ltd. Satyam Infoway was the name of the company which sold its services under the domain name pertaining to its businesses namely, ‘sifynet.com’, ‘sifymail.com’, ‘sifyrealestate.com’ registered with the Internet Corporation for Assigned Names and Numbers (ICANN) and the World Intellectual Property Organization (WIPO), whereas the respondent is said to have registered its domain name under ‘siffynet.com’, ‘siffynet.net’ which was clearly very similar to the domain name under which the applicant company offered its services. The High Court of Karnataka on an appeal by the respondent firm which was not satisfied by the decision of the City Civil Court turned the decision by stating that Sifynet Solutions Pvt. Ltd. had already invested heavily in gathering a customer base for the business, hence it would provide the company with great hardship and irreparable injury if this Court rules in the favor of Satyam Infoway. This doctrine was applied to resolve domain name disputes in Rediff Communication Ltd. v. Cyberbooth & Anr.1 , Yahoo Inc. v. Akash OP Aurora2, Acqua Minerals Ltd. v. Pramod Borse & Anr3.

However, the High Court held that domain names could be protected under the doctrine of passing off referred in the Indian Law of Trade Marks wherein the domain names would be provided with the same status as the trademarks are given and thus the goodwill of a trader can be protected from misrepresentation. The High Court weighed on the Balance of Convenience and thus ruled the decision in favor of Sifynet Solutions Pvt. Ltd.

The Supreme Court through a bench consisting of Justices Ruma Pal and P. Venkatarama Reddi overturned the decision of the Karnataka High Court and ruled in favor of Satyam Infoway, the applicant by declaring that the domain names are subject to the provisions of the Indian Trade Mark Act, 1999 and that there is no separate law which governs the regime of domain names.

The Supreme Court while reading the provisions under Section 2(z), 2(zb), 2(m) stated that in the modern world, the domain names have evolved a great deal from being just a mere business address to a business identifier and hence it is of great importance nowadays in the course of business.

Hence the significance of this judgment lies in the fact that court widened the scope of applicability of Trade Marks and its subsequent use in the modern era.


References : 1(AIR 2000 Bombay 27)

2[1999 PTC (19) 201]

3[2001 PTC 619 (Del)

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