Why You Should Protect Your Trade Names and Domain Names

What is in a name? While Shakespeare believed a rose by any other name may smell just as sweet, a business loses significant value with the loss of its domain name in the digital universe we live. A recent court decision once again emphasized the pitfalls surrounding trade names and domain names that can severely affect a company’s bottom line.

The appellate court in Wooster Floral & Gifts, LLC v. Green Thumb Floral & Garden Center, Inc., considered whether Wooster Floral & Gifts could use its domain name, www.woosterfloral.com. The prior owner had let the domain name lapse and the company did not have a registered trade mark for its name. A competitor, Green Thumb Floral & Garden, registered the domain name and used it to direct customers to Green Thumb’s own website.  

The first critical lesson from Wooster Floral & Gifts, is to make sure the domain name has not lapsed when purchasing a company’s assets or starting a new business. The online business world continues to grow exponentially, and an identifying domain name remains a critical business asset to any company. 

In Wooster Floral & Gifts, the prior owner had closed the business and sold the assets, including the trade name, “Wooster Floral LLC.”  Unfortunately, the domain name, www.woosterfloral.com, had lapsed prior to the asset sale. The purchaser of the trade name lost this valuable asset in our online commercial world.

The second lesson is to consider registering your company’s name as a trademark under Ohio Revised Code § 1329. For a company to pursue the unauthorized use or reproduction of a trademark in a domain name, it must first be the holder of a registered mark. Because “Wooster Floral” was not a registered trademark, there was no remedy available under Ohio’s trademark statute for the competitor’s use of the name.

With no registered trademark, a company is only left to argue that the use of the domain name by a competitor is likely to cause confusion. In Wooster Floral & Gifts, however, the court found the home page clearly identified “Green Thumb Floral,” and there was no use of the trade name, “Wooster Floral” on the website itself. While this is a case by case factual issue, the court’s decision creates an avenue for the use of competitor’s domain names so long as the company’s website is not referencing the trade name itself once the customer is directed there.

This recent decision emphasizes the importance of being vigilant in protecting the company name, whether it is the trade name or domain name. This vigilance should also extend to investigating the availability of a domain name before finalizing any asset purchase or starting a new business. While a rose by any other name may still smell just as sweet, a company that cannot utilize its own domain name is significantly less valuable.

This article should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own lawyer on any specific legal questions you may have concerning your situation.

Barnes & Thornburg LLP is a large, full-service law firm that seeks to take a more entrepreneurial and cost-effective approach both to client service and its own business.

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