YAHOO!, INC. VS. AKASH ARORA & ANR.

CASE ANALYSIS

 OF 

 YAHOO!, INC. VS. AKASH ARORA & ANR.

• Vital Information
  • Court: Delhi High Court
  • Decided: February 19, 1999
  • Citation Number: 1999 IIAD Delhi 229, 78 (1999) DLT 285
  • Type of law: Intellectual Property Law
  • Bench: Mr. M.K. Sharma, Justice           
  • Keywords: Trade Marks Act, Trade and Merchandise Marks Act
  • Counsel for the plaintiff: Mr. Kapil Sibbal
  • Counsel for defendant: Mr. Harish Malhotra 

AUTHOR: Aditya Krishna Gupta, a student of Guru Gobind Singh Indraprastha University, Dwarka Sector-14, New Delhi

Introduction

Often it has been observed that two distinguished individuals or groups are occupied in expensive litigations claiming their right over their brand mark, or brand name. When two enterprises are engaged in homogeneous or overlapping fields of activities and similar lines of business then it is inevitable for the competition to take place and there is an earnest and immense probability of confusion and deception. The global internet media renders a colossal collection of information regarding numerous corporations and subjects such as governance, markets, education, entertainment, etc. This field of technical legal jargon is referred to as Intellectual Property. 

The term ‘Intellectual Property’ refers to an aggregation of legal doctrines, principles, and exclusive rights that safeguard the creation of minds such as artistic achievements, inventions, symbols, names, and images. The rights this portion of the law confers on individuals are not absolute and are subject to an expiry of a certain period. The vision is to preserve commercial goodwill to ensure that people’s business reputations are not hindered. This species of law protects goodwill against any sort of encroachment because goodwill is regarded as an asset. Divergent statutes covered under the ambit of Intellectual Property Rights as Copyright Act, Designs Act, Geographical Indications of Goods Act, Trade Mark Act, Parents, etc. Therefore, this specific branch of law guarantees intangible rights for the protection of commercially vital products of human intellect. The Hon’ble Delhi High Court had comprehensively dealt with the questions arising out of the Trademark Act and the Trade and Merchandise Marks Act in the landmark judgment of Yahoo!, Inc. vs Akash Arora & Anr. The concerned case law was one of the earliest platforms discussing the applicability and extent of Intellectual Property Rights and talks about the management of domain names and cybersquatting. The tort of passing off is used to provide security or safeguard the goodwill annexed to an unregistered trademark.

Conspectus of the indubitable factual matrix of the concerned case

The present suit was instituted under Order 39 Rules 1 & 2 Civil Procedural Code against the defendant namely Akash Arora praying for an order of permanent injunction and additionally ad interim injunction restraining the defendant from operating his business which he was carrying out under the trademark/ domain name ‘Yahooindia.Com’. As the trademark was identical or deceptively similar to the plaintiff’s trademark ‘Yahoo!’ The plaintiff feared attenuation of its distinctive reputation and goodwill. It would be pertinent to highlight that the plaintiff company has a fine reputation in the global market as an internet provider business. Akash Arora initiated a company with similar objectives of rendering internet services in India. The utilization of the specific domain name invited legal action from the plaintiff. Therefore, through this application, the plaintiff prays for a decree holding back the defendant, his representatives, and agents from further carrying out transactions and dealings for the business under the same domain name or trademark. The plaintiff under the particular provisions of the Civil Procedural Code seeks interlocutory orders and temporary injunctions for safeguarding his claim over the registered trademark by restraining the defendant from committing any breach of contract or injury ultimately impacting the integrity and prestige of the plaintiff’s economic interests.

Issues 

The Hon’ble Delhi High Court dealt with the following questions

1. Does Intellectual Property Rights safeguard domain names? 
2. Was there passing off of services offered by Yahoo Inc. after the defendant’s act of registering the name ‘Yahoo India’ and does this come within the meaning of infringement under the relevant provisions of the Trade and Merchandise Marks Act? 

Arguments advanced before the Hon’ble Court

Mr. Kapil Sibbal, counsel on behalf of the plaintiff puts heavy reliance on the ratio decidendi of numerous judgments and argues that the plaintiff was the sole owner of the trademark ‘Yahoo!’ and domain name ‘Yahoo.Com’ has developed great esteem, reputation, and goodwill in the worldwide market of internet providers. It was further submitted that the defendant was indulged in passing off the services and products as he has adopted a synonymous name as that of the plaintiff and such domain name/ trademark of the plaintiff is obliged to be safeguarded against passing off. To corroborate the plaintiff’s suggestion reliance was made on judgment in Marks & Spencer Vs. One-in-a-million, 1998 FSR 265 where it was held that any person who intentionally registers a domain name because of its similarity to the name, trademark, or trademark of an independent business organization must expect to find himself on the receiving end of an injunction to prevent the threat of transfer and injunction will be in conditions that render the title commercially worthless to the seller. The counsel for the plaintiff alleged that the trademarks and domain names are not at all mutually exclusive and alleged that the defendant, Akash Arora has verbatimly copied the format, contents, layout, color scheme, and source code of the plaintiff’s creation. Mr. Sibbal carefully pointed out that internet users in modern times are very well conversant with the selection process of trademarks and domain names and so was the defendant who has attempted to be ‘cyber-squatters’. 

Mr. Harish Malhotra, counsel appearing on behalf of the defendants, countered these allegations and submitted the averments that the trademark law in India is associated with goods and services as a result of which the said provision of law is not at all applicable in the current suit as the facts and circumstances completely lie beyond the ambit of this law. It was further stated that the trademark/ domain name ‘Yahoo!’ The plaintiff is not registered in India. Hence, any legal action against such alleged infringement is not corroborated by any law in our country which renders the said action of passing off baseless. It was argued that there is no deception on behalf of the defendants as ‘Yahoo’ is merely a general dictionary word and has not been seethed by the plaintiff. The defendants also made use of a disclaimer and hence, no action of passing off is maintainable against them. It was significantly argued that there is a very cogent difference between both of the trademarks/ domain names and there is no possibility of any consumer visiting the defendants’ site without any prior study and research about the site. 

Decided 

In light of the aforementioned contentions made from both the sides of the plaintiffs and the defendants, the Hon’ble took into consideration pertinent facts for granting the temporary injunction. 

1. The plaintiff is one of the global giants rendering internet services under the domain name/ trade name ‘Yahoo!’. These services have enabled the interplay of thoughts and ideas around the globe connecting people from worldwide. The plaintiff was amongst the earliest service providers and was the one who initiated a web dictionary named ‘Yahoo!’. 
2. Additionally, the plaintiff is also a provider of such services in the regional section. Due to the burgeoning popularity of ‘Yahoo!’ Many third parties mimic similar trade names to utilize the extant goodwill and reputation inappropriately. The Court concluded that the defendants with a similar intent created ‘Yahooindia.Com’. 
3. The Hon’ble Court examined the settled law of passing off. The fundamental idea behind the lawsuit is that no one has the right to conduct business in a way that could give rise to suspicions that he is managing another person’s company or that he is associated with the enterprise of another person. 
4. Reference was made to the decision of the case of Monetary OverSeas Vs. Montari Industries Ltd. 1996 PTC 142, where this Court held that where the defendant is found carrying a business under a name which is sufficiently identical to the name under which the plaintiff is trading and the name in question is possessing reputation and it is plausible for customers to get misled by the defendant’s business name, the defendant is liable for an action of passing off. 
5. Further reference was made to the decision of Marks & Spencer Vs. One-in-a-million, 1998 FSR 265. The Court typically concluded that the public is likely to be misled when a name’s value is derived exclusively from its resemblance to the name or trademark of another business, as why else would the defendants have chosen it? While the term “services” may not be present in the language used in Sections 27 and 29 of the Trade and Merchandise Marks Act, it is evident that the services provided are now recognized as grounds for passing off. Therefore, the law of passing off is a common law action that is also recognized by statute under the Trade Mark Act. It is therefore too late to argue that a passing-off action against services cannot be maintained in the same way that one could maintain one against commodities in the context of the aforementioned rulings and the evolution of the notion of passing-off legislation.
6. The Court found the defense put forward by the defendants baseless as it stands with no merits. It was held that where the brand name is sufficiently alike to another name, people are more likely to get confused which can hamper the economic interests of a company. 
7. Therefore, in the present suit, the prayer made by the plaintiff was considered and an interim injunction was granted in favor of the plaintiff refraining the defendants from carrying out business dealings, selling, advertising, etc. under the same name. 

Contemporary Analysis 

The case law comprehensively analyzed the growing importance of Intellectual Property Rights and opened new gateways by expanding the ambit. In recent times, legislation associated with IPR has gained significant importance because they are a catalyst for enhancing market values by rejecting unethical practices. It ensures the safety of brilliant human intellect and opportunities. Protection of Intellectual Property involves a complicated procedure but certain laws and numerous judgements of the Apex court have made the process handy. The government has also recognized an exigency of imparting knowledge about these rights and therefore, for this purpose it has initiated awareness missions. One such mission is the National Intellectual Property Mission (NIPAM) which purports to inculcate insights into this legal field to students of higher classes.