Brad Hanna is a lawyer at the Toronto law firm of McMillan Binch and a member of the firm’s Litigation and Dispute Resolution Group.

Someone might be operating a website on the Internet right now known as [name of your company or product here] sucks.com. There are literally hundreds of websites on the Internet that use trade-names or trademarks belonging to well-known companies together with the word ‘sucks’ (or ‘bites,’ ‘blows,’ ‘I hate’ or some other similarly disparaging term) as their domain names.

‘Sucks’ sites are typically operated by aggrieved customers or employees who want to broadcast their complaints about the target company to the world. Such sites frequently reproduce the trademarks and/or copyright logos of the target entity, often with a red ‘X,’ a slash or the word ‘sucks’ superimposed over the logo. Many of these websites are interactive – in that they encourage others to post their own complaints about the target directly on the website for all to see.

The operation of ‘sucks’ websites raises many legal issues – including trademark, copyright, defamation and freedom of speech issues. Well-known ‘sucks’ sites that have given rise to litigation in the U.S. include walmartsucks.com, nikesucks.com, netscapesucks.com and lucentsucks.com. Until recently, however, there were no Canadian cases considering the right to operate such protest sites – or addressing what rights target companies have to shut these sites down.

The law

A Canadian Court has now spoken on the matter. The British Columbia Supreme Court recently released a lengthy decision in the case of British Columbia Automobile Association v.Office of Professional Employees’ International Union, Local 378. The case is important because it is the first time that a Canadian Court has dealt with many of the issues raised by protest, or criticism, websites. Unfortunately, the case doesn’t offer much in the way of comfort to the targets of such websites.

The BCAA is a non-profit organization that provides a variety of products and services to its members. These products and services include emergency road service, travel books, travellers’ cheques and insurance. The BCAA made certain of its products and services and other information available on its website – which is known as, among other names, bcaa.com.

At issue in the BCAA case was a series of websites that were established by the defendant union, which represented some of BCAA’s employees. During a lawful strike in early 1999, the union created an initial website that was very similar in appearance to the BCAA’s website. Among other things, the union’s website copied certain design elements of the BCAA’s website and reproduced certain trademarks and copyrights belonging to the BCAA. The union subsequently began operating two successively different websites. The union’s websites were accessible by a number of domain names, including bcaaonstrike.com, picketline.com and, later, bcaabacktowork.com.

The union’s websites were established to communicate its message to the public about the ongoing labor relations dispute. While the websites did not use the word ‘sucks,’ the BCAA took the position that the websites implied that they were somehow connected to, or affiliated with, the BCAA and that they ‘depreciated the goodwill’ associated with the BCAA’s trademarks.

Shortly after the union established its original website, the BCAA’s lawyers demanded that it stop using the BCAA’s intellectual property (certain registered trademarks and copyright material). The union responded by changing the appearance of its website twice within a period of a few months (the union removed certain logos and changed the color scheme of its website). Unsatisfied with these changes, the BCAA sued the union.

The BCAA’s lawsuit was based on three grounds.

First, it alleged that the union’s first two websites infringed the BCAA’s copyrights by unlawfully reproducing certain design elements found on the BCAA’s website.

Second, the BCAA claimed that the union’s use of the BCAA’s registered trademark ‘BCAA’ in its domain name and meta tags (a ‘meta tag’ is the unseen text used by Internet search engines to locate websites based upon key word searches) constitutes ‘passing off’ Passing off is a legal term that describes the situation where one person leads others to believe that its products or services are those of another.

Finally, the BCAA alleged that the union’s websites depreciated the value of the goodwill associated with the BCAA’s trademarks.

The BCAA sought an order for damages as well as an injunction transferring the union’s registered domain names to the BCAA.

The Court reviewed relevant American and U.K. cases and found in favor of the union on all counts except the breach of copyright allegation. Here, the Court held that the union substantially copied the layout, design and appearance of the BCAA’s website, thereby infringing copyright. However, because the BCAA could not prove that it had suffered any actual losses as a result, the Court only awarded it nominal damages in the amount of $2,500.

With respect to the other issues, the Court found that the union’s use of the BCAA’s trademarks did not constitute passing off and did not depreciate the goodwill associated with its marks. In doing so, the Court relied on certain key facts:

* The union was not competing commercially with the BCAA – rather, it was simply exercising its right of expression to inform the public about the ongoing labour relations dispute.

* The presence of a disclaimer on the union’s websites (basically stating that the union was ‘on strike against the BCAA’). The disclaimer, together with other elements of the union’s websites, eliminated any possibility of confusion that the union’s websites belonged to, were associated with or sanctioned by the BCAA.

* The domain names of the union’s websites were not identical to the BCAA’s trademarks or domain names. Instead, the union’s domain names simply incorporated the BCAA trademark as part of a longer and more descriptive name (such as bcaaonstrike.com).

The BCAA decision indicates that websites engaging in legitimate consumer or employee criticism may be able to resist lawsuits commenced by those who are the subject of the criticism.

More recently, a case decided under the ICANN (International Corporation for Assigned Names and Numbers) Uniform Dispute Resolution Policy considered a ‘sucks’ site and came to a different conclusion.

Reg Vardy Plc v. David Wilkinson involved an angry former customer of a car dealer who had set up a criticism website about the dealer. The arbitrator found that the website was designed to disrupt the dealer’s business and therefore constituted a ‘bad faith’ registration under the UDRP. Accordingly, the arbitrator ordered that the domain name be transferred to the dealership. The decision has been widely criticized, however, for not complying with the plain language of the UDRP. It will be interesting to see whether this decision is followed in subsequent ICANN cases.

What you can do

While the BCAA decision doesn’t completely insulate all ‘sucks’ sites from liability, the Reg Vardy case doesn’t offer a complete solution. You may be able to take action if such sites are operated by competitors for commercial purposes, contain defamatory remarks or infringe your copyright.

You need to be careful, however, in deciding how to respond to such websites. The operators of such sites typically enjoy attention. In fact, the operators of ‘sucks’ sites particularly enjoy the cease and desist letters that they receive from lawyers representing the target company. In many instances, they actually post the letters on their websites. These letters have a tendency to validate their fight for ‘the cause’ and can be used to paint yet another negative image about the target company.

Here are some practical tips to consider if you become aware of a ‘sucks’ site that targets your company:

* Resist the immediate impulse to engage the operator of the

website in a war. Consult with

your legal advisor and initiate

legal action only if there is a

clear infringement of your intellectual property rights or if the information posted on the website is defamatory.

* Remember that any correspondence you send to the operator of the website may end up being posted on the site or might otherwise fuel the fire. For example, Verizon Communications sent a cease and desist letter to the operator of a website known as verizonreallysucks.com. Upon receiving the cease and desist letter, the operator registered another domain name – verizonshouldspendmoretimefixingitsnetworkandlessmoneyonlawyers.com.

* Consider meeting with the operator of the website to address his or her complaints with a view to having him or her abandon the website and transfer its registration to your company.

* Consider creating an area on your company’s own website that responds to the complaints being made and that presents your company’s side of the story.

* Designate a person within your company to be responsible for monitoring the offending website on a periodic basis. Update your company’s side of the story as the ‘sucks’ site grows to include complaints from others.

In some cases, legal action may be warranted. Hopefully, though, following these tips will help you avoid getting a result that ‘sucks.’

(This article contains general comments only. It is not intended to be exhaustive and should not be considered as advice in any particular situation.)

-www.mcbinch.com