Dear Rich: My wife sells hand-made jewelry and recently started putting it up for sale in a local shop and asked me to help her get an e-mail address. Knowing a bit or two about the Internet I decided the best way to do this was to register a domain name and then setup a Google Apps account to host the mail. Everything was set up and fine and then last week I received an e-mail from a law firm saying that the domain I had registered was an "infringing domain" and that the use of such a domain name that incorporates their trademark yadda yadda. Now they say that I have 7 days to respond and transfer the domain name to them and provide a sworn affidavit attesting that I ceased selling any goods that infringe on their trademark. If my wife's little side business is not related to anything that the other company sells, do they have any right to order me to turn over my domain name etc.? I didn't think that anyone could come after you for just requesting a domain name. I'm so glad you asked. The short answer to your question is "More information is needed." You're correct about the basic trademark principles -- if you're not likely to confuse consumers, then there's no trademark infringement. That's why, for example, different companies can use Arrow as a trademark for shirts and staplers and electronics (although only one company can have the domain name, www.arrow.com). Under another theory (dilution), a company with a famous trademark can stop you from using a similar trademark even if the goods or services are not related -- for example, Microsoft could stop a company from selling Microsoft Vista dog food.
But wait, there's more... there's cybersquatting. If you acquired the domain name in bad faith -- most notably if you intended to hold the domain hostage in the hopes of selling it back to the trademark owner -- then the trademark owner can pursue you in federal court under anti-cybersquatting laws (or can force you to arbitrate under international domain name rules). The Dear Rich staff is not saying you're doing any of these things (and it appears from your letter that you're not). But if the big company is hassling you, we're not sure where that will lead. Keep in mind that there's a financial benefit for the law firm if you fight. (Law firms love people who drive up their billables.) We don't want you to cave to a bullying law firm but we're not sure of all the facts in your case and we're not sure that a $10 domain name is worth the hassle. (Unfortunately, it would cost you at least ten times that amount for a half-hour consultation with a trademark attorney.)