Apple Computer has accused a small British company of illegally possessing the web address iTunes.co.uk, and is taking the case to UK registry Nominet demanding to be given the domain.

But Benjamin Cohen, the managing director of CyberBritain Holdings and owner of the address, denies he is a "cyber squatter" and says he properly registered the domain name a month before Apple's application for a British trademark was made public.

"Apple are being very heavy-handed," Mr Cohen said. "They are using their status to unfairly claim an asset of an entirely innocent, British small business."

Mr Cohen says he was unaware that Apple Computer had applied for a trademark for the name "iTunes" on October 27, 2000. Mr Cohen registered the domain name on November 7 that year.

"The details of the application were strictly confidential and only known to Apple, their filing agents and HM Patent Office. It was not until the December 6 2000 that their application was published in the Trade Marks Journal, four weeks after we began using the domain name."

Mr Cohen says the name was automatically suggested by a domain registering website as an alternative after he had made a failed attempt to buy tunes.co.uk. He purchased itunes.co.uk along with a series of other music related names to work as redirects to a music website search engine he was then running.

Mr Cohen now uses the domain as a forwarding address to his latest online venture, the rewards service QuickQuid.com.

Mr Cohen says he was first contacted by Apple's lawyers, Chicago-based Baker & McKenzie, on November 5, demanding the domain name be given up.

A series of letters were then exchanged, but when no settlement was reached Apple filed for a domain authority proceeding with Nominet, saying it owned the right to the name.

"The American iTunes service was running for two years before it was set up in the UK and they could have contacted us then to agree a settlement but they did not," Mr Cohen said.

"Instead, they waited and the first thing they tried was to get a high court injunction to shut down our website. The way they have gone about this has made me determined to fight the case.

CyberBritain has until December 30 to present evidence to Nominet. Apple then has the right to reply and a decision on the case will follow in February.

Under Nominet's rules, a company does not need be granted a trademark before a web address is registered for it to claim right to that domain.

Nominet's rules state that they can rule in the complainant's favour if "the Respondent is using the Domain Name in a way which has confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant".

As the QuickQuid.com website contains a prominent link to a page explaining that the business has no relationship to Apple, Mr Cohen, from Hackney, north London, is confident he will win the case.

"We have been using this web address for four years now and I don't think that a consumer who ends up on our site is going to think they are on Apple's site. If they are interested in us they will stay if not they will find their way to Apple."

This episode is the third controversy to hit Apple in the last two weeks. On Friday the company was referred to the European Commission by the Office of Fair Trading after complaints that it overcharges customers in the UK using its iTunes website.

And the week before the company was heavily criticised for refusing to sell the charity Christmas single Do they know it's Christmas? at the price agreed by all other online music retailers.

No one from Apple was available for comment.

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