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JURIST's Switzerland Correspondent is Cyrill P. Rigamonti, Esq., Dr.iur., University of Zurich Faculty of Law.
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Recent Swiss Rulings on Internet Domain Names

[Zurich; Special to JURIST] As traditional Swiss businesses explore the potential of utilizing the Internet as a marketing tool, disputes about Internet domain names in Switzerland are becoming more and more frequent. In the absence of any legislation specifically governing this subject matter, the legal framework for settling these disputes is currently rather unclear, as the various issues raised by domain names are awaiting clarification by the courts. Even in Switzerland, a small and not very litigious country, the first cases are being brought to the courts. This report will outline the two decisions rendered and published by the Swiss Federal Supreme Court to date.

In its first decision dated February 11, 1999 (Rytz et Cie SA v. Rytz Industriebau AG, BGE 125 III 91), the Swiss Federal Supreme Court was faced with a defendant who had registered part of its company name ("Rytz") as an Internet domain name ("rytz.ch"). The plaintiff used the same name as part of its own company name and had registered an identical trademark ("Rytz") in 1995. Invoking its trademark, the plaintiff sued and applied for a court order enjoining the defendant from using the plaintiff's trademark as a domain name. The cantonal court refused to issue the court order applied for by the plaintiff. On appeal, the Swiss Federal Supreme Court held that the conflict between trademark rights, company name rights, and rights under the unfair competition statute could only be resolved by an equitable weighing of the interests involved. The court concluded that, in the case at hand, the defendant's registration of the domain name did not constitute an infringement of the plaintiff's trademark, but rather a use of the domain name based on objective reasons tied to the existence of a corresponding company name, which had been registered with the Swiss Federal Institute of Intellectual Property before the registration of the plaintiff's trademark. As a result, the Swiss Federal Supreme Court affirmed the state court's decision and rejected the plaintiff's appeal.

In its second decision dated May 2, 2000 (Kaformatik AG v. Verein Berner Oberland Tourismus, BGE 126 III 239), the disputed domain name in question arises from a geographical region, namely "Berner Oberland" (Bernese Highland). The defendant, a computer company (Kaformatik AG) had registered the domain name "berneroberland.ch". The plaintiff, the Berner Oberland regional tourist association, whose members are first and foremost local tourist associations, applied for a court order to enjoin the computer company from using the Internet domain name it had registered. The court granted the injunction and ordered the computer company not to use the domain name. On appeal, the Swiss Federal Supreme Court affirmed the state court's decision based on unfair competition law. More specifically, the Federal Supreme Court first noted that the domain name "berneroberland.ch" was in the public domain, because it designated a geographical region. Therefore, anyone would be legally allowed to use it as long as it does not cause a likelihood of confusion with the names of persons and companies or trademarks, since the key function of domain names is to identify the operator of a Web site or the products and services offered on a Web site. The Court ultimately decided that there was a likelihood of confusion, because the public would expect advertisements and services relating to tourism when spotting the domain name as is, i.e. without additional words added to the URL. As a result, the registration of the domain name "berneroberland.ch" was found to constitute a violation of the unfair competition statute (Art. 2, 3 lit. d UWG).

The Court's conclusion that the public automatically associates the name of a geographical region with tourism and that such name causes the public to believe that the operator of the corresponding Web site is an "official" organization, does not seem very compelling. Instead, it is more likely that the "real" reason underlying the Court's decision was that Defendant, a computer company, had no actual use for the domain name, but reserved the domain name in order to gain a competitive advantage and trade it to acquire the right to design the respective Web pages displayed under the domain name.

As these two decisions demonstrate, the Swiss Federal Supreme Court appears to look at the motive underlying the registration and use of an Internet domain name when deciding a case upon a weighing of the interests involved. Nevertheless, the case law is too scarce to formulate a bright line rule of law and, as a lawyer, one may hope that further disputes will provide the Court with the opportunity to build a more reliable set of tests to apply in Internet domain name cases.

Dr. Cyrill P. Rigamonti, Esq.
JURIST Switzerland Correspondent
February 15, 2001

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