Domain Names and their Legal Side

To do business on the Web, you'll need at least one domain name the yada-yada-dot-com that has become so familiar in commercials and print advertising. Your domain name may be the name you already use for a business, with a dot-com added, or a new name that you think will do a good job of getting people to your website. If you follow the lead of many businesses, you'll use multiple domain names to help the widest possible number of potential customers find your site among the many thousands out there.

Choosing a name, or more than one, for your website is no trivial matter your decisions can make or break your business. This explains why some domain names have been auctioned off for huge amounts of money. The current record-holder is business.com, which went for an astounding $7.5 million. The winning bidder apparently believes the name has enough customer-drawing power to make it worthwhile. Fortunately for small e-commerce start-ups with limited budgets, most businesses make up their domain names or use names that they are already using as trademarks, and don't pay anyone a penny for the privilege.

Domain Name Anatomy

Domain names consist of two main parts: the top-level domain name, or TLD, and the second-level domain name, or SL The SLD comes first. For example, in nolo.com, nolo is the SL The TLD comes at the end of the domain name, after the ubiquitous dot. TLDs are organized, for U.S. participants, into five categories:

•.com, for commercial groups

•.edu, for educational institutions

•.gov, for governmental entities

•.org, for nonprofit organizations, and

•.net, for interactive discussion groups.

Other countries have their own TLDs for example, .fr for France, .gr for Greece, .to for Tonga. It's the SLD that makes your domain name unique. Almost all U.S. businesses choose to operate under the .com domain. There are plans to introduce a number of new TLDs, such as .inc and .stor, but it hasn't happened yet. And even when it does, most businesses are still going to want to be "dotcoms."

Thinking About the Law

You may have thought a lot about the marketing aspects of your domain name how the name can attract visitors, communicate what you do, stick in customers' minds and inspire confidence in your business. All those factors definitely deserve attention, but there's another set of concerns that is at least as important: how trademark law affects your choice and use of a name. If your domain name is the same as or similar to a trademark already being used by a competing or related business, that business might force you to stop using it somewhere down the road. And if you have built up considerable goodwill under the domain name when a trademark conflict flares up, this could amount to a business catastrophe. You can avoid this potential disaster by picking a domain name that is free and clear from legal conflicts.

If Someone Challenges Your Domain Name

This article is not designed to help you if your existing domain name comes under legal attack for instance, if another business demands that you surrender your domain name. If that happens, we recommend Trademark: Legal Care for Your Product and Service Name, by Stephen Elias and Kate McGrath (Nolo), or to Nolo's downloadable eGuide, Trademark Disputes: Who Wins, Who Loses & Why. You may also need to consult a lawyer. Some names are wonderful from a commercial perspective but close enough to existing names to cause a legal tiff, such as the dispute between etoys.com, a large toy dealer, and etoy.com, a small website of some English artists. Still other names may be unique as domain names but identical or confusingly similar to names used by brick-and-mortar-companies a fact which easily can give rise to a trademark infringement lawsuit. Fortunately, you can select a domain name that will be both commercially appropriate for your business and free from legal challenges by other businesses. Your best strategy may be to leverage an existing business name, with strong customer recognition, by using it (or part of it) as your domain name. But if you're just starting out, you may want to invent something catchy and different.

Protecting the Name You Choose

To be sure that your name really is different not identical to or similar enough to someone else's trademarked name you need to search for available domain names and register your domain name with a domain name registry service. The next step is to file an application with the U.S. Patent and Trademark Office to register your domain name as a trademark.