Most of us don’t think about our telephone numbers very often but these strings of digits can be incredibly important. You might not be able to recall your best friend’s phone number off the top of your head but thanks to a TV ad from the early 2000s you may remember the number for the Reading Writing Hotline (1300 655 506) or the number of the titular Jenny from Tommy Tutone’s 1981 hit tune (867-5309).
This instalment of IP Whiteboard focuses on two decisions which consider the rights that do and do not subsist in telephone numbers. The first is a recent decision of the Australian Federal Court in Manly Warringah Cabs (Trading) Co-operative Limited v Sydney Taxis Pty Ltd, in the matter of Sydney Taxis Pty Ltd (No 2)  FCA 1336. The second is a domain name decision of a WIPO Arbitration and Mediation Center Panel in Multi-National Concepts Pty Ltd v. 1300 Directory Pty Ltd, WIPO Case No. DAU2009-0002.
Federal Court decision
Manly Warringah Cabs (Trading) Co-Operative Limited (Manly Cabs) and RSL Ex-Servicemen’s Cabs & Co-Operative Members Limited (RSL Cabs) each owned 50% of Sydney Taxis Pty Ltd (Sydney Taxis). Sydney Taxis operated a radio room and call centre for both Manly Cabs and RSL Cabs.
In 2008, Sydney Cabs and Manly Cabs entered a Business Sale Agreement (BSA) which stated that Sydney Taxis would obtain certain telephone numbers of Manly Cabs at completion but did not describe the mechanism by which this was to occur (Disputed Numbers).
The Disputed Numbers were associated with the Manly Cabs brand, with some featuring as part of the livery of Manly Cabs’ taxis. However, as a result of the parties’ joint call centre operations, the Disputed Numbers were material to the businesses of both Manly Cabs and RSL Cabs.
In August 2020, a provisional liquidator was appointed to Sydney Taxis on the application of Manly Cabs. RSL Cabs contacted the provisional liquidator to state its intention to submit an offer to purchase the Disputed Numbers if Sydney Taxis were to be wound up.
Manly Cabs sought a declaration that no right, title or interest in the Disputed Numbers passed to Sydney Taxis under the BSA and that Manly Cabs had the better right to the Disputed Numbers of the parties involved.
Were the Disputed Numbers property?
Gleeson J concluded that there is no property in a telephone number.
According to section 454B of the Telecommunications Act 1997 (Cth), “Determination of a person as the numbering scheme manager does not confer any property rights in numbers used in connection with the supply of carriage services in Australia.”
Telstra was the ‘numbering scheme manager’ in this case and given it was unable to confer property rights in the Disputed Numbers as a result of section 454B, so too was Manly Cabs.
This was confirmed by Telstra’s General Terms for Corporate Customers (Telstra Terms), which stated that customers did not own or have any legal interest or goodwill in a telephone number issued to them.
Gleeson J therefore made a declaration that no right, title or interest in the Disputed Numbers passed to Sydney Taxis under the BSA.
Who had the better claim to the Disputed Numbers?
It was not in dispute that Sydney Cabs was the customer and obtained contractual rights in respect of the Disputed Numbers under the Telstra Terms. Although Manly Cabs’ use of the Disputed Numbers substantially contributed to any value that existed in them, Gleeson J was not satisfied that Manly Cabs had a better right to the Disputed Numbers than the contractual right obtained by Sydney Cabs.
Gleeson J stated that the circumstances and available evidence did no support an order by the court that the Disputed Numbers be transferred to Manly Cabs under section 90-15 of Schedule 2 of the Corporations Act 2001 (Cth).
Her Honour concluded that the decision of whether to transfer the Disputed Numbers to Manly Cabs for no consideration was a commercial one to be made by the provisional liquidator. RSL Cabs has expressed an interest in purchasing the Disputed Numbers and accordingly, the liquidator may have been able to realise some value in the Disputed Numbers for the benefit of Sydney Taxis’ creditors.
This decision concerned various “smartnumbers” and domain names which corresponded with those smartnumbers. According to the Australian Communication and Media Authority (ACMA):
smartnumbers® are freephone (1800 numbers) and local rate (13 or 1300 numbers) telephone numbers that are allocated through an on-line auction system by the Australian Communications and Media Authority (ACMA) on behalf of the Government. A smartnumber®, or phone word, can be a valuable marketing tool if it is a highly patterned number, for example, 1800 222 222, or if it can be translated into a memorable phoneword, for example, 13 2287 (13 CATS). A caller dials a phoneword by pressing the letters on a telephone keypad. Phonewords are easier for callers to remember, particularly if they can be linked to an organization’s name or function e g. 13 RSPCA.
The domain names which were the subject of the dispute were owned by 1300 Directory Pty Ltd (Respondent) and each took the form of a phoneword with the addition of “.com.au” (e.g. 1300accountant.com.au) (Disputed Domain Names). Multi-National Concepts Pty Ltd (Complainant) had a licence from ACMA to the smartnumbers which corresponded to the Disputed Domain Names.
To succeed, the Complainant needed to satisfy three elements under the .au Domain Name Dispute Resolution Policy (Policy):
- the Disputed Domain Names were identical or confusingly similar to a name, trademark or service mark in which the Complainant had rights; and
- the Respondent had no rights or legitimate interests in respect to the Disputed Domain Names; and
- the Disputed Domain Names were registered or subsequently used in bad faith.
In respect of each smartnumber, the Complainant accepted that it only had licence rights in the smartnumber (ie. 1300 222 686), not the corresponding name (ie. 1300ACCOUNTANT). The key question for the Panel to determine was therefore whether the smartnumbers were “names” for the purposes of the Policy.
According to the Panel, although telephone numbers would not normally be considered a name, some numbers could be names or trade marks (for example, Boeing has registered “747” as a trade mark in some jurisdictions). However, recognition of a number as a name or trade mark would generally only occur where the number had enjoyed significant promotion and had a reputation that could be tied to particular goods or services, or where the number was the legal name for a legal person.
In the Panel’s view, the Complainant was not using the smartnumbers as names or brands. Instead, the Complainant’s primary objective was to sublicence the smartnumbers to people who would want to use them as telephone numbers (and possibly as names or brands).
There was no evidence to suggest that the Complainant had promoted its smartnumbers or that its smartnumbers were recognised as names. Accordingly, all the Complainant had demonstrated was an exclusive licence to various telephone numbers. Were this to be deemed sufficient, it would lead to an absurd result whereby any telephone number licenced to a person could constitute a name under the Policy.
In light of the above, the Panel concluded that the Complainant had not established rights in a name (as required by the first element of the Policy) and denied the complaint.
The Panel noted that its conclusion in this case would not prevent an entity from ever being able to demonstrate rights in a phoneword for the purposes of the Policy. For example, a phoneword such as 1300 FLOWERS may enjoy protection as a result of significant promotion and a reputation that can be tied to particular goods or services.
Although these two decisions examined telephone numbers in different contexts, some common ground can be identified.
Neither decision characterised telephone numbers as property. In the Federal Court case, Gleeson J concluded that the right held by Sydney Taxis in the Disputed Numbers was contractual, arising from the agreement with Telstra. Similarly, the Panel in the WIPO decision found that the Complainant had merely acquired licence rights in the smartnumbers.
Both decisions also recognised that some value may subsist in telephone numbers as a result of their use. In the Federal Court case, this value was created through Manly Cabs’ use of the Disputed Numbers as part of its advertising. Conversely, the Panel in the WIPO decision denied the complaint (at least in part) because the Complainant’s smartnumbers had not enjoyed significant promotion or developed a reputation tied to particular goods or services.
Other WIPO cases
It is worth noting that Panels in a number other WIPO cases have also considered smartnumbers. For example, the majority of the Panel in Inbound Telecommunications Pty Ltd, Phonename Marketing Australia Pty Ltd v. 1300 Directory Pty Ltd, Demetrio Padilla, WIPO Case No. DAU2009-0018 agreed with the decision in Multi-National Concepts Pty Ltd v. 1300 Directory Pty Ltd. However, in a dissenting opinion, one Panelist took the view that smartnumbers could constitute names within the meaning of the Policy without evidence of use. In reaching this conclusion, the dissenting Panelist drew analogies to company names, business names and personal names which qualify as names under the Policy regardless of their use.
In 0800 Flowers Limited, Phonenames Limited v. 0800 Blossoms Ltd., WIPO Case No. D2003-0053 (a case brought under the Uniform Domain Name Dispute Resolution Policy), the Panel cited a party’s registration and use of a phoneword as part of its business as evidence that the party had rights in an unregistered trade mark which corresponded to the phoneword.