Governing the Internet

By Rob Hassett

Casey Gilson P.C.

Six Concourse Parkway, Suite 2200

Atlanta, GA 30328

(770) 512-0300

http://www.internetlegal.com

 

This article was prepared for the seminar on Advanced Internet and Computer Law sponsored by the National Business Institute scheduled for October 29, 1998 in Atlanta. This advanced level article addresses such questions as who “owns” the Internet, the current role of the U.S. government, and the future of the domain naming system. (25 pages)

ACKNOWLEDGEMENTS

The writer wishes to thank the following individuals for providing information and/or assistance in preparing these materials:

1. Jay Fenello, who is the President of Iperdome, Inc. (http://www.iperdome.com) Jay is currently serving as a member of the Steering Committee for the International Forum on the White Paper (IFWP) to assist in setting up the structure for a new domain name system. (http://www.ifwp.org)

2. Bruce Hassett, a brother of the writer, who is currently employed with GTE Internetworking. GTE acquired BBN, including the BBN Planet network, approximately one year ago. (http://www.bbn.com)

3. Lynn Hassett, the writer’s wife, who is an attorney in the same law firm as the writer.

4. The staff of the Competitive Pricing Division of the Federal Communications Commission (FCC) Common Carrier Bureau. (http://www.fcc.gov)

5. Ellen Rony, who is a co-author of “The Domain Name Handbook.” (http://www.domainhandbook.com)

6. Richard Sexton, who participated in some aspects of the development of the Internet.

I. INTRODUCTION

To understand the current operation of the Internet and the controversies concerning the domain name system, it is necessary to understand the relevant history.

II. ORIGINS OF THE INTERNET

A. ARPA.

In 1957, the Soviet Union launched the first man-made satellite, Sputnik, which surprised most Americans who had assumed that the United States was far ahead of the Soviet Union technologically. As a consequence, President Dwight Eisenhower established the Advanced Research Projects Agency (“ARPA”). ARPA was set up as an agency of the Department of Defense but was established for the purpose of promoting scientific research.(2)

ARPA sponsored computer research and development at major universities throughout the country including research into time-sharing systems, computer graphics and improving computer programming languages. At the time, computers were extremely expensive and the sharing of resources was difficult not only because there was no network but because the computer languages, protocols, etc. were not compatible. In 1966, officials at ARPA decided to set up a network among computers at major universities. This network became known as the “ARPANET.”(3) The contract to build ARPANET was awarded to a small consulting firm in Boston, Bolt, Bernek & Newman (which of course later established the “BBN Planet” network). BBN set up a network information processor (“NIP”) at each participating university. The NIP’s were used to send and receive all messages.(4) Performance testing was contracted to the Network Measurement Center at UCLA. Two individuals that became very prominent in the construction of the Internet, Vince Cerf and Jon Postel, were students at UCLA that worked part-time at the Network Measurement Center.(5) These individuals, as well as many others, overcame significant technological obstacles in making the ARPANET operational. Jon Postel retains a central role in the operation and development of the Internet to this day.

B. Network Working Group.

One of the problems that the universities had to deal with was that although connections could be made through the ARPANET, it was necessary to agree upon protocols to allow communications between the incompatible computers at the various universities. Representatives from the various universities met and formed an open group called the Network Working Group or “NWG.” Possibly because they had no authority, the students followed the pattern set by one of their members who wrote up minutes of their first meeting and called minutes of all of their meetings “Requests For Comments” to set the tone that anyone could contribute.(6) By 1972, Jon Postel had become the editor and distributor of the Requests For Comments.(7)

C. Other Networks.

As time went on ARPANET became obsolete. The network for military computers was taken over by the MILNET network and the academic links were taken over by the network established by the National Science Foundation (the “NSFNet”).(8) Other commercial networks were also set up.

D. TCP/IP.

In order to link the different networks, it was necessary to come up with a new advanced set of protocols which ultimately became the Transmission-Control Protocol and the Internet Protocol now referred to as “TCP/IP”. An individual named Bob Kahn, while employed by ARPANET and working with Vince Cerf, developed the first version of TCP which led to the ability to connect multiple networks of multiple computers.(9)

E. Current Configuration of the Internet.

Currently, the Internet is a network of networks. With few exceptions such as MILNET, which is operated by the U.S. Military, the networks are privately owned. GTE currently owns and operates the BBN Planet network. WorldCom owns and operates the UUNET network. AT&T, MCI, Sprint and many other companies own and operate other networks that are part of the Internet. The networks, which include all of those referred to in the previous sentence, that provide high capacity nationwide connections are also known as “backbones.”

Access to the servers and information that reside on all of the networks that form the Internet can be made through any of those networks. Such access can be obtained through the larger national (and even International) networks (run by the Tier 1 providers such as GTE, UUNET, MCI, etc.), the smaller regional networks (such as Erols, BellSouth, etc.), or the local ISP’s which buy their network transit from one of the larger providers.

How does a computer connected to any one of the networks that forms the Internet successfully connect to a computer located on a different network? The Internet works because the separate networks that form the Internet connect, or peer, with each other. There are two types of peering: public and private.

Public peering, where many networks connect to each other through a large network switching system, occurs at several different public exchange points around the world. The concept of public peering points was originally established by the National Science Foundation. There are many public exchange points. Some of the more well-known ones are MAE East (Washington, D.C., operated by MFS), Sprint NAP (northern New Jersey operated by Sprint), MAE West (Palo Alto, operated by MFS) and LINX (London). Virtually all of the networks that make up the Internet peer at one or more of the public exchange points. Because of the tremendous traffic, serious bottlenecks can occur at these exchange points.

With this in mind, many of the larger providers have established private agreements among themselves to establish private peering — i.e., transfer of traffic via a dedicated, high-speed circuit between two companies’ networks, thereby avoiding the bottlenecks at the public exchange points. Companies will only agree to peer with those companies that they expect will receive as much data as they send. With companies like UUNET and GTE, that is not a problem because both networks will dump about the same amount of traffic onto each other. However, if one company only has web sites (i.e., does not offer dial-up access or direct-connect business access), then that company will tend to dump a lot more traffic on the other networks than the reverse. This imbalance has resulted in certain networks refusing to privately peer with certain other networks.(10)

It is possible to trace the route of one’s packets(11) from one’s own computer to most web sites (tracing to some of the larger ones is blocked). First, connect to your Internet service provider, bring up a DOS prompt and at the DOS prompt type in: “tracert www.[second level domain name (such as “internetlegal”)].[top level domain name (such as “com”)]. From Atlanta it is evident that MindSpring is connected directly at least to “alternet” which is “UUNET.”

F. Initial Domain Naming System.

In 1982, Jon Postel and others developed a new standard for email which they named “simple mail transfer protocol.” As the number of computers connected to the Internet multiplied, it was necessary to develop a new addressing scheme. A group of engineers led by Paul Mockapetris, who was at that time employed by the Information Sciences Institute at the University of Southern California in Marina del Rey (“ISI”), and including Jon Postel, who was at that time and still is employed by ISI, and Craig Partridge, who was at that time employed by BBN, developed what is now referred to as the domain naming system (“DNS”). It was eventually decided that the initial generic top level domain names would be: (12)

(1) “edu” for university sites;

(2) “gov” for government sites;

(3) “com” for company or commercial sites;

(4) “mil” for military sites;

(5) “org” for non-profit organization sites;

(6) “net” for network service providers; and

(7) “int” for international treaty entity sites.

III. Ownership.

From the above, it is clear that almost all of the networks of the Internet as well as the exchanges are owned by private companies just as are most telephone facilities. TCP/IP specifications were developed by government employees. Consequently, any copyrights in those specifications are in the public domain.(13) Assuming the protocols constituted statutory subject matter and met other requirements, the United States could have owned patent rights in these protocols provided the U.S. had filed an application within the required one (1) year period, but apparently did not do so. TCP/IP is therefore available without restriction, although there may be proprietary rights in derivative versions.

IV. FCC Regulations.

The Federal Communications Commission (“FCC”) has the authority to regulate “interstate and foreign commerce in communication by wire and radio.”(14) The state public utility commissions have the right to regulate such communications that are intrastate.(15) Prior to enactment of the Telecommunications Act of 1996, the FCC made a distinction between “basic” and “enhanced” communication services. Basic services were standard voice transmission services. Enhanced services were defined as:

services, offered over a common carrier transmission facilities used in interstate communications, which employ computer processing applications that act on the format, content, code, protocol, or similar aspects of the subscriber’s transmitted information; provide the subscriber additional, different, or restructured information; or involve subscriber interaction with stored information.

Examples of enhanced services are protocol processing, alarm monitoring, voice messaging and electronic publishing as well as the provision of access to data networks such as commercial online services and the Internet.(16) Providers of basic services were considered to be communications common carriers. Common carriers are prohibited from:

Unreasonably denying requested services or from unreasonably discriminating in the terms and conditions of service, and are subject to various other requirements and fees.(17)

Although the Telecommunications Act of 1996 categorizes services as “telecommunications” versus “information,” the FCC has, for the most part, continued to apply the same dichotomy construing what were considered “basic” services as “telecommunications” services and construing what were referred to as “enhanced” services as “information” services. For telecommunications services, other than those provided over the Internet as discussed below, the FCC requires that tariffs be filed. Tariffs are documents provided to the FCC which set forth the terms, rates and conditions under which services will be provided. Telecommunications service providers are required to file tariffs for ordinary telephone services and for the portion of frame relay services which involve transport, but not for the protocol relay or addressing component. Copies of tariffs are available for a fee from ITS, Inc. (http://www.itsi.com).

Using the Internet and encryption software, it is possible to set up a virtual private network that, although in many cases where multiple sites are involved would be significantly less expensive, provides functionality that can, many times, be substituted for a private frame relay network. To this date, the FCC has chosen not to require that tariffs be filed on or to impose universal access charges (which are imposed generally on telecommunications services) either for services of Internet access providers or for transmissions over the Internet backbones.(18)

V. Government Legacy Functions.

A. Initial Structure.

There are four (4) functions essential to the operation of the Internet that continue to be provided under contracts with agencies of the United States government.(19)

(1) The assignment of numerical addresses (Internet Protocol or “IP” numbers) to Internet users. Every computer while connected to the Internet is assigned a unique IP number. Numbers can be assigned dynamically to dial-up users so that any user has a unique IP number only during the time of the connection. Therefore, to provide dial-up access, ISP’s only need to have enough IP numbers to equal the number of users at any one time. Each second level domain name requires a permanent IP address. Without a change of technology, there cannot be more than four (4) billion unique numerical addresses. One-third (1/3) of those have already been assigned. The replacement of the IP protocol with proposed IPv6 as currently configured would allow for a virtually unlimited number of IP addresses.

(2) Management of the system of registering names for Internet users. This includes the system of assigning top-level domains, second-level domains, and so on. This function, combined with “(3)” below, is referred to as the “domain naming system” or “DNS.”

(3) The operation of the root server system. There are thirteen (13) root servers including the “A” root server operated by Network Solutions, Inc. (NSI). The “A” root server contains what is supposed to be the authoritative data base of the top level domain name servers including the servers for the international top level domain names and the servers for each of the country specific domain names. All the other root servers point to the “A” server for this information. The U.S. government plays a role in about half of these root servers. From letters I have seen, the other root servers are operated by volunteers who believe that they were given that authority by Jon Postel and/or his organization, IANA.

(4) Protocol assignment. This involves management of the protocols that are used to operate the Internet.

Initially, ARPA (the name was changed to the “Defense Advanced Research Projects Agency” or “DARPA” in 1984) contracted to have the domain name functions administered by the Stanford Research Institute (SRI). (20) Through a contract with DARPA, in 1987 SRI also took over the assignment of numerical addresses from ISI. ISI continued to oversee the operation of the root server system and the protocol assignments.

B. IANA.

Jon Postel was in charge of the Internet services provided by the Information Sciences Institute. Mr. Postel named his group at ISI the: “Internet Assigned Number Authority” or “IANA.”(21) After the responsibility for the international domain names and IP numbers was transferred to the Stanford Research Institute, IANA retained responsibility, under contracts with DARPA, for the other functions referred to above and later with the National Science Foundation, for managing the .us top level domain and registering other country specific top level domains. Eventually, IANA again assumed responsibility for assigning IP numbers and assigned blocks of Internet protocol numbers to three (3) non-profit organizations, APNIC for the Asia-Pacific region, RIPE NCC for Europe, and ARIN for the western hemisphere and South Africa(22) and also to a number of profit corporations for reassignment including @Home for the cable industry, AT&T and BBN Planet. Each of these five (5) organizations act as registries for the IP numbers they assign.

There has been a lot of misinformation about where IANA’s authority came from, but the reality is that it was always through government contracts.

The IANA home page reads:

The IANA is chartered by the Internet Society (“ISOC”) and the Federal Network Council (“FNN”) to act as the clearinghouse to design and coordinate the use of numerous Internet Protocol parameters. (See, http://www.iana.org.)

This information has been quoted and accepted by the media. None of it is true. As is pointed out in The Domain Name Handbook, supra, at 123, ISOC and FNC didn’t exist in 1988 when IANA was first formed. The authors of The Domain Name Handbook, supra, quote an email they received in response to a questioning of this authority from Anthony Rutkowski, the former president of the Internet Society. Mr. Rutkowski’s letter said in pertinent part:

Just to note – in case you’re writing history here – that although Jon and some others include this rendition, there is no such thing as a charter by either the Internet Society or the FNC. I was running the Society at the time that Jon distributed an e-mail message to the Society Board that was entitled “Charter.” He was told in subsequent messages that this meant nothing. Neither the Society as a non-profit corporation, or the FNC as an interagency committee [of the United States government] are in the business of “chartering.” What Jon prepared was an excerpt of the description of the activity for which he is funded by NSF. It’s an important function – but that is what it is – an NSF funded editor activity.

C. NSF.

In any event by the end of 1989, what had been the ARPANET had been replaced by NSFNet and certain regional networks.(23) In 1991, Congress passed the “High Performance Computing Act” which authorized NSF to provide computing and network infrastructure. At that time, NSF assumed responsibility for the registration of domain names. NSF redelegated the function of registering domain names from SRI International to Government Systems, Inc.(24) Finally, NSF entered into an agreement dated January 21, 1993 transferring domain name registration activities for the international top level domain names to Network Systems, Inc. (NSI).(25)

According to Article 7 of the agreement, NSI was to provide these services through September 30, 1998. So here we are in September of 1998, when I am writing this paper, and it is still not clear who will administer the international top level domain names after September 30. It also isn’t clear who will be responsible for allocating blocks of numerical addresses, managing the root server system and managing the Internet protocol suite in the future.

D. NSI.

NSI is, understandably, fighting hard to try to retain the current top level international commercial names that it administers: .com, .net and .org. Among other arguments, NSI claims that it has ownership rights in at least a portion of the DNS database.(26) The U.S. government would argue that since NSI has been administering these top level domain names under contract with NSF, NSI hasn’t acquired any rights in those top level domain names.(27)

By Amendment 4 to its contract with NSF, NSI was, in September of 1995, permitted to start charging $100 upfront for the first two (2) years and $50 per year thereafter for all second level domain names that it issued and to retain seventy (70%) percent of those funds.(28) Beginning April 1, 1998, NSI was no longer required to remit thirty (30%) percent of its funds as directed by NSF and dropped its fees to $70.00 for the first two (2) years and $35.00 per year thereafter.(29)

NSI has had to deal with a number of lawsuits relating to domain name disputes. NSI issued its first domain name dispute policy, apparently for the purpose of protecting NSI from lawsuits, on July 28, 1995. Revisions were issued on October 23, 1995 and September 9, 1995.(30) The most recent revision is dated February 25, 1998 and is available at http://rs.internic.net/domain-info/nic-rev03.html. This policy requires that any registrant agree to defend, indemnify and hold harmless Network Solutions and its officers, directors, employees and agents for any loss or damage relating to registration of a domain name. Since most web site registrants do not sign this document, much less personally fill out any of the information or even go to the site (this is ordinarily handled by the ISP for the registrant) this indemnity is likely enforceable, if at all, only against a very small percentage of registrants.(31) In the earlier version there was an arbitration clause that any disputes were subject to arbitration in San Diego, California, where NSI’s parent corporation was located. However, that arbitration procedure is no longer included in the latest domain name dispute policy.

The newest policy favors claimants to domain names that have registered their domain name on the principal register of the United States Patent & Trademark Office or the equivalent of any other country.(32) Where the owner of a registered mark provides written notice to a domain name registrant that the registrant’s domain name violates the trademark rights of the complainant, the domain name registrant may send a copy of such notice to NSI. If the registration predates the date the domain name registrant obtained the domain name, NSI may request proof that the registrant also has a registered trademark or service mark that pre-dates the date of the notice. If no proof of prior registration is provided, and assuming no court action is filed within thirty (30) days of NSI’s request for proof of registration, NSI may then put the registrant’s domain name on hold. Just to show how absurd a policy giving priority to registered marks can be, note that although registration in the United States Patent & Trademark Office takes an average of ten (10) months, registration in Tunisia can be completed in a matter of days and doesn’t require proof of use or intent to use the mark in Tunisia or anywhere else. See, http://www.domainprotect.com.

E. Policy Oversight Committee.

Over the years, the Network Working Group appears to have been replaced by the Internet Society (“ISOC”), the Internet Activities Board and other groups in which many internet insiders including Mr. Postel, are prominent. As more and more of the .com and .net second level domain names were taken, it became apparent that additional international top level domain names should be available. There are situations in which second level domain names can be generic such as “flowers,” “schools,” and “bricks” and there can be other situations where more than one company has a legitimate right to a particular mark such as “Delta.” Additionally, having more top level domain names would allow the grouping of web sites by category. Examples would be “.law” and “.med.” Jon Postel recognized this at least as early as May 3, 1996 when he proposed the addition of up to fifty new registries that would have the exclusive right to administer name assignments. He also recommended adding thirty new international top level domains per year for five years so that at the end the fifty new registries would each have exclusive right to administer three new top level domain names.(33)

IANA, the Internet Society (ISOC), the International Trademark Association (INTA) and other organizations elected representatives to the Internet International Ad Hoc Committee (IAHC) which was formed to review Mr. Postel’s proposal as modified by ISOC. There were eleven members elected to the committee. Mr. Postel is not listed as a member. Three of the eleven were attorneys.(34) The Committee issued its “Generic Top Level Domain Memorandum of Understanding” in which it proposed adding seven new generic top level domain names and twenty-eight new registrars who would compete among themselves to register second level domains in the generic top level domains. The committee appointed a “Policy Oversight Committee” to oversee administration of the top level domain names. The POC ultimately decided the additional top level domains should be:

.arts, . firm, .info, .nom, .rec, .shop and .web.(35)

The overall policies were set forth in the POC’s Memorandum of Understanding on the generic top level domain names space of the Internet domain name system (gtld-Mou).(36) The POC also decided that additional domain names could be added “if, in consultation with the PAB and CORE, the POC should later determine, that the interests of the users of the Internet would be best served by the creation of additional gTLDs.”

The question one would ask is what caused the POC to drop from the one hundred fifty domain names initially planned by Mr. Postel to only seven. The Committee was apparently strongly influenced by the difficulties having additional top level domain names would likely create for the owners of trademarks and service marks. The more top level domain names there are, the more opportunity there is for registration of second level domains that infringe existing trademarks and service marks. The counter-argument is that not allowing additional top level domain names to avoid wrongful use of trademarks is like prohibiting the building of additional shopping centers because that makes it more likely that service marks of existing stores will be infringed.

Although a number of criteria, including payment of $10,000, were established for anyone desiring to apply to be a registrar, and there were only certain times when applications have been allowed, more than ninety have been granted to date and it was contemplated that additional registrars will be established in the future.(37) Of course, with severe restrictions on the number of generic top level domain names, it was no longer possible to give exclusive registration rights for any one international top level domain name to any one registrant.

Probably the most controversial aspect of the POC proposal is the proposal to set up a domain name challenge panel (ACP) administered through the World Intellectual Property Organization of the United Nations (WIPO) arbitration and mediation center which is headquartered in Geneva, Switzerland. Anyone registering a second level domain name would be required to agree, as a condition of registration, that any decisions regarding the assignment, registration and use of a particular domain name would be subject to arbitration before the ACP. Then any third party could challenge a domain name holder’s right to use a domain name through this arbitration process. The POC also provided for any applicant registering a domain name to elect, at the time of registering such domain name, whether to be subject to on-line arbitration of all issues (which would include such issues as ultimate rights to use the claimed service marks and damages).(38)

F. NTIA Proposal.

In recent years, there have been individuals that have attempted to introduce additional top level domain names into the Internet root system. These groups and individuals argue that, except for restrictions needed only to avoid interfering with the proper operations of the Internet, the addition of top level domain names should be governed by the market; and whoever first offers a top level domain name and is able to attract sufficient second level domain names to make the use of such domain names financially feasible should be permitted to own and operate their own international top level domain name registries. These groups and individuals have strongly objected to the gTLD-Mou proposals arguing that the proposals would create an authoritative operation answerable to no one other than themselves and which would have no free market incentive to encourage improvements and efficiency. These individuals and groups (the free market parties) relayed their concerns and objections to Congress and the White House. Ira Magaziner, who has headed up various policy initiatives for the Clinton Administration, was assigned the responsibility for putting together a task force to deal with the issues. The National Telecommunications and Information Administration of the United States Department of Commerce headed by Mr. Magaziner came out with a preliminary proposal entitled the “Green Paper” which was published in the Federal Register on February 20, 1998 in which recommendations were made.(39) Among other things, in the “Green Paper” NTIA had proposed the formation of a non-profit corporation to be fairly representative of a variety of interested communities to take over the legacy functions; but, to avoid delay, proposed to go ahead and add five additional international top level domain names before the new non-profit corporation was formed. After receiving extensive comments, NTIA issued a second paper known as the “White Paper” on June 5, 1998, in which NTIA decided to leave the addition of any new international top level domain names to the new proposed non-profit organization and essentially urged all interested groups to get together and come up with solutions that address the needs and concerns of all interested parties subject to certain overall principles.(40) The principles were that the non-profit corporation was to be established in the United States, would assure stable, undisrupted, operation of the Internet, would be representative of all the various interests associated with the Internet, would operate in an open manner, would promote competition and would come up with balanced solutions related to the trademark issues.

As an indication of the determination of the Internet insiders with regard to the MoU-POC proposal, in January of 1998, just before the Green Paper was to come out, Jon Postel, who operates the root name server located at ISI, sent emails to the operators of the other root name servers telling them to point their servers to the ISI server bypassing NSI’s “A” root server. Six of the operators complied with this request. Mr. Postel announced that this was just a test of the server system but the timing would certainly indicate that it was a threat. The White House apparently pressured Mr. Postel into discontinuing the “test.”(41)

G. IFWP.

After the NTIA in the “White Paper” had urged all interested parties to work together on a plan, a number of trade associations representing diverse Internet interests put together a working group to attempt to reach a consensus on the structure for the proposed non-profit corporation. A committee, referred to as the Steering Committee for the International Forum on the White Paper (IFWP), was formed. Four meetings were held. The first meeting took place in Reston, Virginia on July 1-2, 1998, the second in Geneva, Switzerland on July 24-25, 1998, the third in Singapore on August 11-13, 1998 and the fourth in Buenos Aires, Argentina on August 20-21, 1998. (42) No resolution has been reached by these parties to date. Consequently, it is possible that the NSF contract with NSI, that is due to expire on September 30, 1998, may have to be continued and IANA will continue to administer the functions that it oversees for some additional time.

1 The writer is currently Co-Chair of the Subcommittee on Policies for Managing Generic Top Level Domains of the Special Committee on Trademarks and the Internet of the Intellectual Property Law Section of the American Bar Association. The views expressed in this paper are those of the writer alone.

2 Katie Hafner and Matthew Lyon, Where Wizards Stay Up Late, Chapter 1 (1996).

3 Where Wizards Stay Up Late , id. at 40-42. As stated, the original purpose of the ARPANET was to allow communication and the sharing of resources between research computers. The media has reported, and it has been repeated extensively, that ARPANET was originally set up to allow military communications to survive a nuclear strike. The development of packet data technology at Rand Corporation, which was eventually useful in setting up the ARPANET, was done for this purpose, but that was never the purpose of ARPANET. Where Wizards Stay Up Late, supra, 9-10.

4 Where Wizards Stay Up Late, supra, at 102.

5 Where Wizards Stay up Late, supra, at 141.

6 Where Wizards Stay Up Late, supra, at 144.

7 Where Wizards Stay Up Late , supra, at 145.

8 Where Wizards Stay Up Late, supra, at 245 and 249. See, also, Ellen Rony and Peter Rony, The Domain Name Handbook, 1998 at 91.

9 Where Wizards Stay Up Late, supra, at 226.

10 Kate Gerwig, Service Providers Still In Peering Dither, InternetWeek, 8/31/98.

11 A packet is a set of data organized in a specific way for transmission such as over the Internet. See, e.g., Harry Newton, Newton’s Telecom Dictionary, Flatiron Publishing (1998).

12 Where Wizards Stay Up Late, supra, at 252-253.

13 See 17 U.S.C. §105.

14 47 U.S.C. §151.

15 See, e.g., O.C.G.A. §46-2-20.

16 See, Kevin Werbach, Digital Tornado, The Internet and Telecommunications Policy, March 1997, Opp. Working Paper No. 29 available at:  http://www.fcc.gov/Bureaus/OPP/working_papers/oppwp29pdf.html.

17 See, Kevin Werbach, Digital Tornado, The Internet and Telecommunications Policy, supra.

18 See, e.g., The Federal Communications Commission Report To Congress released April 10, 1998 entitled “The Matter of Federal-State Joint Board On Universal Service.” (http://www.fcc.gov/Bureaus/Common_Carrier/Reports/fcc98067.html) Note that the United States Court of Appeals for the 8th Circuit recently held that FCC rules not allowing local telephone companies to assess access charges on internet service providers is a proper exercise of the FCC’s jurisdiction. See, Southwestern Bell Company, Bell Telephone Company, et al. v. Federal Communications Commission (U.S. Ct. App.). (http://www.wulaw.wustl.edu/8th.cir/Opinions/980819/972618.P8)

19 See, National Telecommunications and Information Administration of the United States Department of Commerce (NTIA) so-called “White Paper” entitled Management of the Internet Domain Name System dated June 5, 1998 (http://www.ntia.doc.gov/ntiahome/domainname/6_5_98dns.htm)

20 The Domain Name Handbook, supra, at 115.

21 National Telecommunications and Information Administration “White Paper,” supra.

22 The Domain Name Handbook, supra, at 138 and 123. See, also, the NTIA White Paper, supra.

23 See Where Wizards Stay Up Late, supra, at 256.

24 The Domain Name Handbook, supra, at 126 and 127.

25 http://rs.internic.net/nsf/agreement/agreement.html

26 The Domain Name Handbook, supra, at 171.

27 The original database was, of course, transferred from Government Systems, Inc. to NSI at the direction of NSF. Under the circumstances applicable here, it is unlikely that there are any enforceable copyrights in the additions to the database made by NSI. See, Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340 (1991). Anyone should have the right to copy the database to the extent it is openly accessible. Whether NSI would be required to turn over any confidential portions of the database would depend on the interpretation of the NSF-NSI contract which is beyond the scope of this paper. Copyright issues for this presentation are being addressed in other materials being provided with this reference manual. For other articles about copyright law, see our law firm web site at http://www.internetlegal.com.

28 http://rs.internic.net/nsf/agreement/amendment4.html

29 See the Internic Registration and Renewal (re-registration) fees: Fact Sheet (http://rs.internic.net/fees/facts.html)

30 The Domain Name Handbook, supra, at 142.

31 Of course NSI would probably argue that the ISP is acting as an agent and, acting on behalf of its customer, has agreed to the indemnification provision by submitting the application to NSI. For the enforceability of clickwrap and similar agreements, see the portion of the paper provided by this author on Electronic Commerce relating to Online Contracting included with these seminar materials.

33 The Domain Name Handbook, supra, at 522.

34 The Domain Name Handbook, supra, at 524.

35 See the gltd-Mou Request for Comments Results – Last Update March 16, 1998 (http://www.gtld-mou.org/docs/rfc-results.htm#97-02).

36 http://www.gtld-mou.org/gTLD-MoU.html

37 It would seem that having an unlimited number of registrars competing with each other and registering the same domain names would create conflicts and disagreements about who registered a particular domain name first; however, individuals working on the issue say that with available software, this should not be a problem.

38 See the Memorandum of Understanding for the Internet Council of Registrars (CORE-Mou) a copy of which is available at http://www.gtld-mou.org/docs/core-mou.htm.

39 (http://www.ntia.doc.gov/ntiahome/domainname/dnsdrft.htm)

40 See http://www.ntia.doc.gov/nitahome/domainname/6_5_98dns.htm.

41 Rajiv Chandrasekaran, Internet Reconfiguration Concerns Federal Officials, The Washington Post, 1/31/98.

42 See http://www.geneva.ifwp.org/

The information above is provided for general educational purposes and not as legal advice. Laws in areas in which we practice change continually and also vary from jurisdiction to jurisdiction. Therefore no visitor to our site should rely on any of the articles provided for legal advice, but should always consult their own attorney regarding legal matters.

© 1998, Rob Hassett, Atlanta, Georgia. All Rights Reserved.

Recent Developments in Internet Law

Rob Hassett and Suellen W. Bergman

Hassett Cohen Goldstein & Port, LLP

990 Hammond Drive, Suite 990 Atlanta, GA 30328

(770) 393-0990

http://www.internetlegal.com

 

ACKNOWLEDGEMENTS

The writers wish to thank Robert Port, a partner in the above law firm, and Lori Brill, an associate in the above law firm, for their help in preparing these materials.

I.       Introduction

Over the past year, courts, Congress, and state legislatures have dealt with a number of different issues concerning the Internet, including:

1.         The enforceability of agreements entered into over the Internet;

2.         Spam;

3.         Under what circumstances is there liability for copying?

4.         How far will the courts go to restrict the use of marks as domain names, metatags and other uses on the Internet?

5.         What privacy rules apply?

6.         What is a Web site operator’s liability for a Web site which involves activity that is legitimate in some jurisdictions, but illegal in others?

These and other recent developments are discussed in this paper.

II.      What constitutes an enforceable agreement entered into over the Internet?

Agreements entered into over the Internet generally take one of two forms, either an exchange of  e-mail or clickwrap. Clickwrap agreements are agreements formed by a purchaser manifesting assent to the terms of an agreement online by pointing and clicking a mouse. An agreement based on an exchange of e-mails relating to subject matter which does not require a signed writing to be enforceable has been held to be effective. See, e.g., CompuServe, Inc. v. Richard S. Patterson, 89 F.3d 1257 (6th Cir. 1996). The controversies regarding the enforceability of agreements entered into over the Internet involve the enforceability of clickwrap agreements and whether agreements entered into over the Internet constitute signed writings.

A.        Clickwrap Agreements

The authors are not aware of any cases to date that directly address the issue of whether clickwrap agreements are enforceable. There is one case that implicitly holds that they are enforceable. A number of cases deal with whether shrinkwrap agreements (which we believe provide a useful legal analogy) are enforceable. The most important issue addressed by courts today regarding the enforceability of shrinkwrap agreements is whether or not shrinkwrap agreements are pre-empted by copyright law.

1.         The case that implicitly held that clickwrap licenses are enforceable is Hotmail Corp. v. Van Money Pie, Inc., (N.D. Cal. 1998) 47 U.S.P.Q. 2d (BNA) 1020 (1998); 1998 U.S. Dist. Lexis 10729 (April 16, 1998). In that case, the United States District Court for the Northern District of California granted the plaintiff a preliminary injunction in a case alleging that the defendants breached the terms of a service contract for using the plaintiff’s e-mail service. Without discussing the issue, the Court in that case implicitly held that the defendants were obligated to the terms of service on the Hotmail Web site. Users of that service agreed to those terms by clicking the “I agree” button.

2.         In ProCD, Inc., v. Zeidenberg, 86 F.3rd 1447 (7th Cir. 1996), ProCD developed and sold copies of a CD ROM containing a database of telephone numbers. The CD ROM box informed the consumers there was a shrinkwrap license inside the box. The shrinkwrap license provided that the purchaser was only receiving a license and the purchaser could not make copies of the product. Zeidenberg copied the database onto his own Web site and then provided access to the database via his Web site to customers for a fee. The Court rejected the holding of Vault Corp. v. Quaid Software Ltd., 847 F.2d 255 (5th Cir. 1988), that shrinkwrap licenses are pre-empted by copyright law, and held that the ProCD shrinkwrap license was enforceable.(1) The Court thus provided a way for database developers to protect their databases (by contract) even though copyright law would probably not protect the database here. (2)

a.         Several courts have followed the ProCD decision: Microstar v. Formgen, Inc., 942 F. Supp. 1312 (S.D. Cal. 1996) (copying from a computer game); Hill v. Gateway 2000, Inc., 105 F.3rd 1147 (7th Cir.), cert. denied, 522 U.S. 808, 118 S.Ct. 47, 139 L.Ed.2d 13 (1997) (shrinkwrap license sent with a Gateway computer); Brower v. Gateway 2000, Inc., 246 A.D.2d 246, 676 N.Y.S.2d 569, 37 U.C.C. Rep. Serv. 2d (CBC) 54 (N.Y. App. Div. 1st Dep’t 1998) (allowed Gateway 2000 to require that any disputes be resolved by arbitration in Chicago, Illinois); and Mortenson Co., Inc. v. Timberline Software Corp., 93 Wash. App. 819, 831, 970 P.2d 803, 809 (1999) (upheld a shrinkwrap license agreement, included in the software, which was fairly standard and contained an “accept-or-return” provision).(3)

b.         Note that Section 112 of the Uniform Computer Information Transactions Act (UCITA), discussed infra, would modify ProCD somewhat because UCITA provides that where a mass-market purchaser licensee does not have an opportunity to review a mass-market license or a copy of it before becoming obligated to pay and does not agree, to the license after having the opportunity to review it, the licensee is entitled to return the product and (1) is entitled to reimbursement of any reasonable expenses incurred in complying with the licensor’s instructions for return or destruction of the computer information or, in the absence of instructions, incurred for return postage or similar reasonable expense in returning it; and, in some circumstances, (2) is entitled to compensation for any reasonable and foreseeable costs of restoring the licensee’s system. See UCITA Section 112.

A case which tangentially addressed the shrinkwrap issue is Step-Saver Sys. v. Wyse Tech. and The Software Link, 939 F.2d 91 (3rd Cir. 1991), where the Court applied the “battle of the forms” rules and determined that the parties’ agreement was complete when the goods were ordered via telephone coupled with the purchase order. The Court held that the shrinkwrap license was sent after the fact and thus had no effect. The Software Link’s shrinkwrap license was also held unenforceable for the same reason in Arizona Retail Sys., Inc. v. The Software Link, 831 F. Supp. 759 (D. Ariz. 1993).

3.       Generally, it appeared that the copyright pre-emption barrier raised in Vault Corp., supra, had been buried by ProCD and its progeny. However, in a case involving claims relating to the pitching of a marketing concept (which did not involve any kind of online agreement but could have repercussions in the online context), the United States District Court for the Western District of Michigan held that the claim was pre-empted by copyright law. See Wrench, LLC v. Taco Bell Corp., 51 F. Supp. 2d 840 (W.D. Mich. 1999), 51 U.S.P.Q.2d (BNA) 1238. The Court denied the claim of a company that had pitched the Chihuahua concept to Taco Bell and claimed Taco Bell used the concept without paying for it. The Court held that any implied contract was pre-empted by copyright law. The Court distinguished ProCD on the somewhat nebulous grounds that the ProCD agreement was in effect at the time of purchase (i.e. before use of the product) whereas the Taco Bell agreement was not supposed to take effect unless Taco Bell started using the Chihuahua concept (i.e. after use of the concept). Note that use or copying of a product (i.e. a copyrighted item) is the same action which triggers liability under copyright law. This case is in line with an earlier Louisiana case regarding shrinkwrap licenses: Vault Corp., supra.

B.      Signed Writings

Both clickwrap agreements and e-mail exchanges may cover transactions where signed writings are required under the applicable statute of frauds. A number of states now have some kind of a digital signature act. Most of these acts require that, to satisfy any statute of frauds, the electronic signature must be:

1.       Unique to the person using it,

2.       Capable of verification, and

3.       Under the sole control of the person using it.

See, e.g., Georgia Electronic and Signatures Act at O.C.G.A. §10-12-3 et seq. as originally enacted; the Utah Digital Signatures Act, Utah Code Ann. §46-3-101, et seq. (Supp. 1996). Before the enactment of O.C.G.A. §10-12-3 et seq., an argument could be made in Georgia that anything intended to be a signature would constitute a signature. See, e.g., Troutt v. Nash AMC-Jeep, Inc., 157 Ga. App. 399, 278 S.E.2d 54 (1981), which held that the printing of a company name at the bottom of a form constituted a signature, permitting a car dealer to meet certain state law requirements of providing a signed form. The latest developments in this area are discussed below.

1.       The newest version of Georgia’s statute, (4) Electronic Records and Signatures, which provides for broad acceptance of electronic signatures, reads, in pertinent part, as follows:

(a)        Records and signatures shall not be denied legal effect or validity solely on the grounds that they are electronic.

(b)        In any legal proceeding, an electronic record or electronic signature shall not be inadmissible as evidence solely on the basis that it is electronic.

(c)        When a rule of law requires a writing, an electronic record satisfies that rule of law.

(d)       When a rule of law requires a signature, an electronic signature satisfies that rule of law.

(e)        When a rule of law requires an original record or signature, an electronic record or electronic signature shall satisfy such rule of law.

(f)        Nothing in this Code section shall prevent a party from contesting an electronic record or signature on the basis of fraud.

O.C.G.A. §10-12-4 provides further as follows:

The term “electronic signature” is defined as “a signature created, transmitted, received, or stored by electronic means and includes but is not limited to a secure electronic signature.”(5) O.C.G.A. §10-12-3. The term “record” is defined as “information created, transmitted, received, or stored either in human perceivable form or in a form that is retrievable in human perceivable form.” O.C.G.A. §10-12-3.

2.       The proposed Uniform Electronic Transactions Act (UETA), which provides that “an electronic record or signature may not be denied legal effect or enforceability solely because it is in electronic form” and that “if a law requires a record to be in writing, an electronic record satisfies the law”(6) has been approved by the National Conference of Commissioners on Uniform State Laws, and the Conference has voted to present the Act to states for adoption. (7)

The Electronic Transactions Act has been passed in California. California’s Governor signed the Uniform Electronic Transactions Act on September 16, 1999, and it was chaptered (Chapter No. 428) by the Secretary of State on the same date. See CA S.B. 820.

3.       The Uniform Computer Information Transactions Act (former proposed UCC Article 2B). The legal rules for computer information transactions which was to be promulgated by the National Conference of Commissioners on Uniform State Laws (8) as Article 2B of the Uniform Commercial Code, instead is being proposed as the Uniform Computer Information Transactions Act (UCITA).(9) The Act is the first general commercial statute to provide comprehensive procedures and rules for computer software licensing. Most of those rules would also be appropriate for a broad range of transactions outside UCITA’s scope, and it is expected that they will form the model for several future articles of the UCC as they did for the Uniform Electronic Transactions Act (UETA), which was approved at the same time.(10) The provisions include:

an express recognition of electronic records as the equivalent of writings, rules for attribution of electronically generated messages, methods for establishing authentication, rules for allocating losses caused by electronic errors, and rules for determining when electronic messages are deemed to be effective. A particularly noteworthy provision recognizes the enforceability of agreements made by the interaction of “electronic agents,” even if no human was directly involved in either or both sides of the “negotiation.” (11)

Software publishers and computer manufacturers strongly support UCITA, but it is as strongly opposed by a wide range of groups. UCITA is controversial because:

UCITA represents a movement toward licensing of information in its many forms and away from the sale of copies as traditionally understood under copyright law. UCITA would enforce the broad [consumer] use of “shrink-wrap” and computer “click-on” licenses (called “mass-market licenses” in UCITA). By licensing rather than selling something, a vendor can wield more control of the downstream use of the product. Placing new constraints on the use of information in mass-market transactions can, in turn, constrain the use of information for important public purposes such as democratic speech, education, scientific research, and cultural exchange. Many believe that UCITA fails to appreciate the strong public interest in prohibiting new restrictions on information exchange.

The scope of UCITA is extremely broad. “Computer information,” under UCITA, includes everything from copyrighted expression, such as stories, computer programs, images, music and Web pages; to other traditional forms of intellectual property such as patents, trade secrets, and trademarks; to newer digital creations such as online databases and interactive games. Although the statute claims to be limited to information in electronic form, it allows other transactions to “opt-in” to being governed by UCITA.

Many legal community commentators are of the opinion that UCITA (or something like it) is not necessary or, at least, it is premature. This view is based on the opinion that existing common law and copyright law are developing appropriately to handle the new types of information-based transactions emerging in the information economy.

The American Law Institute (ALI), consumer advocacy groups, libraries, and the Federal Trade Commission have continued to criticize and/or oppose the UCITA proposal and prior UCC 2B drafts, yet their concerns have not been addressed. Instead, NCCUSL intends to push the UCITA proposal as quickly as possible to state legislatures.

A Quick Look at the Uniform Computer Information Transactions Act (UCITA), American Association of Law Libraries: Washington Affairs, July 15, 1999.(12)

4.         Ballas v. Tedesco, 41 F.Supp. 2d 531 (D.N.J. 1999). This case addresses the issue of whether an exchange of e-mails can satisfy the requirement that assignments of copyrights are not effective unless they are in writing and signed by the transferor. See, Copyright Act §201(d). In this case, Tedesco wanted to produce a CD of dance music for Ballas. Ballas would pay Tedesco a fee for the musical arrangements and production of the CD, and Ballas would have the exclusive right to manufacture copies of the CD for sale. Negotiations, via e-mail, were unsuccessful, and the parties did not agree on terms of the arrangement. The parties agreed that the music content copyright belonged to the Defendant. The Court enjoined the Plaintiff from making or selling the music on the CD because the Court found that there was no valid assignment of the copyright since there was no written assignment.

III.    Spam (13)

A.        Spam cases

1.         Hartford House, Ltd. d/b/a/ Blue Mountain Arts v. Microsoft Corp., CV 778550, Sup. Ct. Cal. Santa Clara County, 1998. Blue Mountain creates and sends electronic greeting cards. In this lawsuit, Blue Mountain charged that (1) Microsoft has a competing electronic greeting card Internet site and (2) Microsoft distributed a trial version of Internet Explorer which includes an e-mail filter that identifies Blue Mountain’s cards as spam and sends them into a junk mail folder instead of sending them to the intended recipient. On December 17, 1998, Judge Robert Baines ordered Microsoft to provide Blue Mountain with the necessary information to enable Blue Mountain to alter its e-mail notification messages and greeting cards to ensure that they pass through Microsoft’s anti-spam filtering tool in the beta version of Internet Explorer 5.0. (14)

2.         Intel v. Hamidi, Superior Court of California, County of Sacramento, Judge John R. Lewis, April, 1999. Ken Hamidi was dismissed from Intel in 1995. On six occasions between 1996 and 1998, he sent e-mail messages to over 30,000 Intel employees, which detailed his opinion of the company’s abusive and discriminatory employment practices. In April, 1999, Judge Lewis granted summary judgment to Intel, finding that Hamidi’s messages trespassed on Intel’s proprietary computer system and caused harm. This decision has been criticized (15) because (1) although there was arguably no state action,(16) Judge Lewis did not engage in any First Amendment analysis and (2) given the serious purpose of Hamidi’s messages and the minimal harm they caused to Intel’s computers, Hamidi’s free speech rights should prevail over Intel’s property rights in a fair balancing test.

3.         The Tenth Circuit, in U.S. West v. FCC, 182 F.3d 1224 (10th Cir. 1999), held that U.S. West could not be blocked by an FCC rule from using information obtained from customers regarding who the customers called, and other similar data, for marketing to those individuals because such prohibition was “a violation of the First Amendment.” The Court reasoned that such use constituted commercial speech, applied the First Amendment commercial speech analysis, and held that the proposed FCC rule was unconstitutional. The test (17) was as follows:

First, determine whether the commercial speech concerns lawful activity and is not misleading. If so, the speech can only be restricted if:

(1)        the government has a substantial state interest in regulating the speech;

(2)        the regulation directly and materially advances that interest; and

(3)        the regulation is no more extensive than necessary to serve the governmental interests.

Surprisingly, the Court found that the rule was not narrowly tailored because it did not do such things as allow phone customers to opt in or opt out (assuming that there is a serious desire by telephone company customers to have their personal calls tracked and used for marketing purposes). This indicates that some anti-spam statutes may violate free speech if they completely prohibit spam without considering other alternatives.

This case is troubling because:

(1)        it allows telephone companies that track customer calls to use that information to market to those customers, and

(2)        this analysis could support a First Amendment right to send spam.

As in other spam cases, U.S. West involves a “captive,” as opposed to a “voluntary,” audience. (18)

To date, the cases that have held spam to be illegal involved claims of Internet Service Providers and Intel,(19) that spam is a form of trespass. This analysis of spam as a trespass is not as vulnerable to a First Amendment attack as a state or federal statute prohibiting spam. See, e.g., CompuServe, Inc. v. Cyber Promotions, Inc., 962 F. Supp. 1015 (S.D. Ohio 1997) (holding that a private company’s motion seeking a court to enjoin “spam trespass” did not constitute state action subject to a First Amendment attack).(20)

B.        Federal Legislation

A proposed federal statute regarding unsolicited bulk e-mail was introduced in the House on May 5, 1999: Internet Freedom Act, 106 H.R. 1686. (21) This Act, in proposed Section 104, entitled “Protection from Fraudulent Unsolicited E-Mail,” would amend 18 U.S.C. § 1030 such that, inter alia, it would be a violation of the Act to “intentionally and without authorization initiate the transmission of a bulk unsolicited electronic mail message to a protected computer with knowledge that such message falsifies an Internet domain,(22) header information, date or time stamp, originating e-mail address or other identifier” or to sell or distribute a computer program which (a) “is designed or produced primarily for the purpose of concealing the source or routing information of bulk unsolicited electronic mail messages (23) in a manner prohibited by” the Act, (b) “has only limited commercially significant purpose or use other than to conceal such source or routing information,” or (c) “is marketed by the violator or another person acting in concert with the violator and with the violator’s knowledge for use in concealing the source or routing information of such messages.” The Act provides for the following potential damages for various offenses: injunctive relief and other equitable relief, actual monetary losses, statutory damages of $15,000 per violation or an amount of up to $10 per message per violation, whichever is greater; reasonable attorneys’ fees, and other litigation costs.

C.        State Legislation

Some states have passed laws regarding unsolicited e-mail.

1.         Washington State: Wash. Rev. Code § 19.190.020 (1999), entitled “Unsolicited or Misleading Electronic Mail — Prohibition,” provides as follows:

(1)        No person, corporation, partnership, or association may initiate the transmission of a commercial electronic mail message from a computer located in Washington or to an electronic mail address that the sender knows, or has reason to know, is held by a Washington resident that:

(a)        Uses a third party’s Internet domain name without permission of the third party, or otherwise misrepresents any information in identifying the point of origin or the transmission path of a commercial electronic mail message; or

(b)        Contains false or misleading information in the subject line.

(2)        For purposes of this section, a person, corporation, partnership, or association knows that the intended recipient of a commercial electronic mail message is a Washington resident if that information is available, upon request, from the registrant of the Internet domain name contained in the recipient’s electronic mail address.

2.         Nevada’s statute focuses on spam which contains advertisements. Nev. Rev. Stat. 41.730, entitled “Liability of Persons Who Transmit Items of Electronic Mail That Include Advertisements,” provides:

1.         Except as otherwise provided in Nev. Rev. Stat. 41.735, (24) if a person transmits or causes to be transmitted to a recipient an item of electronic mail (25) that includes an advertisement, the person is liable to the recipient for civil damages unless:

(a)        The person has a preexisting business or personal relationship with the recipient;

(b)        The recipient has expressly consented to receive the item of electronic mail from the person; or

(c)        The advertisement is readily identifiable as promotional, or contains a statement providing that it is an advertisement, and clearly and conspicuously provides:

(1)        The legal name, complete street address and electronic mail address of the person transmitting the electronic mail; and

(2)        A notice that the recipient may decline to receive additional electronic mail that includes an advertisement from the person transmitting the electronic mail and the procedures for declining such electronic mail.

2.         If a person is liable to a recipient pursuant to subsection 1, the recipient may recover from the person:

(a)        Actual damages or damages of $10 per item of electronic mail received, whichever is greater; and

(b)        Attorney’s fees and costs.

3.         In addition to any other recovery that is allowed pursuant to subsection 2, the recipient may apply to the district court of the county in which the recipient resides for an order enjoining the person from transmitting to the recipient any other item of electronic mail that includes an advertisement.

3.         California has also passed a law dealing with unsolicited bulk e-mail (which also applies to unsolicited faxes). This California Statute requires that the sender of unsolicited advertisements advise the e-mail recipient that the e-mail is an advertisement by placing the characters “ADV:” first in the subject line and also requires that the sender provide the recipient a return address or a toll-free number where the recipient can request that the sender refrain from sending additional unsolicited e-mail. See Cal. Business & Professions Code §17538.4. (Division 7, Part 3, Chapter 1) (Deering 1999), entitled “Unsolicited fax or e-mail.”(26)

IV.     Copyright

Several recent Internet related cases and statutes involve copyright issues, including the rights to sound recordings, distribution and derivative rights, and copyright term.

A.        Legislation

The Digital Millennium Copyright Act of 1998 (105 P.L. 304; 112 Stat. 2860)

1.         Exempts Internet service providers from liability for copyright infringement under certain circumstances;

2.         Makes it illegal to circumvent technology used to prevent copyright infringement(27) and, inter alia (this provision is to take effect two (2) years from October 28, 1998);

3.         Expands the rights of owners of sound recordings to restrict performance (or in some cases receive set royalties for) of their sound recordings from what was covered by the Digital Sound Recording Act of 1995 (28) to any sound recordings provided over the Internet whether or not it is via subscription or interactive (this provision is effective as of the date of enactment).

B.        RIAA v. Diamond Multimedia Sys., Inc., 29 F. Supp. 2d 624 (C.D. Cal. 1998) aff’d, 180 F.3d 1072 (9th Cir. 1999), 51 U.S.P.Q.2d (BNA) 1115.

The Court of Appeals for the Ninth Circuit affirmed the denial of a preliminary injunction finding that Diamond Multimedia, the maker of Rio,(29) had not violated the Audio Home Recording Act of 1992 (30) with the Rio because the Rio could not make copies except from a hard drive. The Court found that such copying was not covered by the Act. However, on August 4, 1999, Diamond Multimedia and the RIAA announced that they entered into a settlement agreement. RIAA’s general counsel and senior executive vice president, Cary Sherman, stated that this “announcement makes clear that the future of the digital music marketplace will be created in the marketplace itself, enabled by initiatives like SDMI [Secure Digital Music Initiative].”(31) While the authors have not been able to obtain details of the settlement reached between RIAA and Diamond Multimedia, one can infer from what has been published that the terms probably include a requirement that Diamond incorporate technology which prevents serial copying.

C. Tasini v. New York Times Co., 1999 U.S. App. LEXIS 23360 (2d Cir. 1999).

A federal district court in New York held that making publication information accessible on Lexis-Nexis and other similar data bases “constitutes reproduction and distribution of freelance contributions as part of that particular collective work.” Tasini v. The New York Times Co., 972 F.Supp. 804 (S.D.N.Y. 1997), 43 U.S.P.Q.2D (BNA) 1801. The District Court held that the publishers were protected by a privilege afforded to publishers of “collective works” under Section 201(c) of the Copyright Act, but the Second Circuit reversed this decision in Tasini v. New York Times Co., 1999 U.S. App. LEXIS 23360 (2d Cir. 1999). The Second Circuit concluded that “the Publishers’ licensing of Authors’ works to UMI for inclusion in these databases is not within the Section 201(c) revision privilege.” Id. at *22. The Court continued:

The relevant inquiry under Section 201(c), is . . . whether the republication or redistribution of the copyrighted piece is as part of a collective work that constitutes a “revision” of the previous collective work, or even a “later collective work in the same series.” If the republication is a “new anthology” or a different collective work, it is not within the privilege. H.R. Rep. No. 94-1476, at 122-23 (1976), reprinted in 1976 U.S.C.A.A.N. 5659, 5738. Because NYTO is for present purposes at best a new anthology of innumerable editions of the Times, and at worst a new anthology of innumerable articles from these editions, it cannot be said to be a “revision” of any (or all) particular editions or to be a “later collective work in the same series.”

Id. at *22-23. Accord Ryan v. Carl Corp., 23 F. Supp. 2d 1146, 1150 (N.D. Cal. 1998), 48 U.S.P.Q.2D (BNA) 1626 (commenting that “calling the reproduction of a single article a “revision” of a collected work, however, is more strained than even a flexible interpretation can withstand” and construing Section 201(c) of the Copyright Act in the authors’ favor).

D.        Challenging the constitutionality of Sonny Bono Copyright Term Extension Act of 1998 (CTEA).(32)

The Sonny Bono Copyright Term Extension Act of 1998 has been criticized as copyright overprotection, rather than copyright extension. This Act is important to the Internet because it reduces the benefits of those Internet sites that provide digital copies of public domain works.

Some have criticized the CTEA because it offers an extension of the term of copyrights for an author or creator without any reciprocal requirement of the author or creator. Also, the CTEA delays works from entering the public domain, without any corresponding benefit to society. One such critic of the CTEA, Lawrence Lessig, the Berkman Professor of Law at Harvard Law School, has filed a lawsuit on behalf of Eldritch Press,(33) a non-profit organization that posts literary works on the Internet when they have entered the public domain.(34)

Article I, Section 8 of the United States Constitution states that Congress may “promote the Progress of Science and useful arts, by securing for limited times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries” (emphasis added). In 1790, this limited time period of copyright was twenty-eight years. Subsequently, Congress enacted a series of extensions, which provide for copyright terms of up to seventy-five years. These extensions retroactively extended the copyright for works which were written many years ago that would otherwise soon enter the public domain.(35) The Sonny Bono Copyright Term Extension Act of 1998 has again retroactively extended the copyright terms; this extension is challenged in the Eldritch lawsuit. The plaintiffs argue that (1) the retroactive extension in the Sonny Bono Copyright Extension Act violates the constitutional “limited times” requirement for constitutional exclusive rights to “writings and discoveries” and (2) the retroactive and prospective extensions violate the First Amendment because they suppress speech without promoting any respective governmental interests. The Sonny Bono Copyright Extension Act has also been criticized by some as merely a vehicle which Disney (which lobbied for the Act) will benefit from, because Mickey Mouse would have entered the public domain in 2004. Under the Sonny Bono Act, however, Mickey will remain Disney’s copyright until 2023.(36)

V.      Domain Names and Marks

Domain names give an entity an Internet identity and enable the public to locate an entity on the Internet.

A.        Case law Registration of a competitor’s mark as a domain name (hijacking) was held to be legal in Juno Online Servs., L.P. v. Juno Lighting, Inc., 979 F.Supp. 684 (N.D. Ill. 1997), 44 U.S.P.Q.2D (BNA) 1913.

B.        Playboy Enters., Inc. v. Welles, 7 F.Supp.2d 1098 (S.D. Ca. 1998), 47 U.S.P.Q.2D (BNA) 1186, aff’d, 1998 U.S. App. LEXIS 27739 (9th Cir. 1998). A former playmate was permitted to state her association with Playboy (PEI)(37) on her own Web site. The heading of the defendant’s Web site is “Terri Welles–Playmate of the Year 1981,” and title of the link page is “Terri Welles–Playboy Playmate of the Year 1981.” Each of the pages uses “PMOY ’81” as a repeating watermark in the background. According to defendant, eleven of the fifteen free Web pages include a disclaimer at the bottom of the pages which indicates that the Web site is not endorsed by Playboy. Id. at 1100. Playboy moved for a preliminary injunction which would enjoin defendant from (1) using the trademarked term “Playmate of the Year” in the title of the home page and the link page; (2) from using the watermark “PMOY ’81” in the background; and (3) from using the trademarked terms “Playboy’ and ‘Playmate” in the meta-tagging of defendant’s site. The Court denied a preliminary injunction because the trademarks that defendant uses, and the manner in which she uses them, describe her and identify her. Therefore the Court held that the defendant has made a “fair use” of these marks(38) and her site was not confusingly similar to Playboy’s site.

C.        Playboy Enters., Inc. v. Netscape Communications Corp., 55 F. Supp. 2d 1070 (C.D. Ca. 1999). This case involves the sale of online banner ads keyed to specific search terms: “playboy” and “playmate.” The Court ruled that the terms “playboy” and “playmate” are generic and that Playboy has no monopoly on those words in all forms. Consequently, the Court denied Playboy’s request for a preliminary injunction against Excite, Inc. and Netscape Communications Corporation finding that the sale of those search keywords to third-party advertisers which operate adult entertainment sites does not constitute trademark infringement or dilution.

D. Avery Dennison Corp. v. Sumpton, 1999
U.S. App. LEXIS 19954 (9th Cir. 1999) 51 U.S.P.Q.2D (BNA) 1801. This was an appeal of a case in which an entity which maintained domain registrations for individual names that included among other surnames, “Avery.net” and “Dennison.net” was held not to have diluted the “Avery Dennison” mark. The Ninth Circuit reversed the District Court’s holding that there was dilution. The Ninth Circuit held that:

1.         The Avery Dennison mark was not famous because it was not “truly prominent and renowned” so that even marks “with such powerful consumer associations and even non-competing users can impinge on their value.” Avery, 1999 U.S. App. LEXIS 19954, *13. The Court pointed out that there were many registrations of marks and uses of the marks “Avery” and “Dennison” by others, and this factor weighs against those being famous marks.

2.         The Court also said that although “an intent to arbitrage” constituted a commercial use, an intent to “capitalize on the surname status of ‘Avery’ and ‘Dennison’ did not constitute a commercial use of a mark.” Id. at *30.

E.        Anti-Cybersquatting Consumer Protection Act

The United States Senate has passed a proposed act, entitled the Anti-Cybersquatting Consumer Protection Act (S. 1255), which would:

1.         Allow the bringing of an in rem action(39) against the domain name that had been registered in violation of the Act; and

2.         Permit recovery for cybersquatting, i.e. allow trademark holders to obtain civil damages from those who register domain name identifiers which are identical or similar to their mark: the trademark holder can recover damages of at least $1,000.00, but not more than $100,000.000 per domain name identifier.

F.         Ringling Bros.-Barnum & Bailey Combined Shows v. Utah Div. of Travel Dev., 170 F.3d 449 (4th Cir. 1999), 50 U.S.P.Q.2d (BNA) 1065, held that Ringling Brothers could not prevent Utah from using “The Greatest Snow on Earth” as a slogan for Utah’s winter sports attractions because the Federal Anti-Dilution law was held to require a showing of “actual economic harm” to the famous marks’ economic value by lessening its former selling power as an advertising agent for its goods or services. Proof of this harm should be demonstrated by surveys and showing actual loss.

G.        The First Circuit, in I.P. Lund Trading A.P.S. v. Kohler Co., 163 F.3d 27, 49 U.S.P.Q.2d (BNA) 1225 (1st Cir. 1998), specifically rejected the “lessening of demand for the product” test that had been applied by the Fourth Circuit in the Ringling Brothers case.

H.        ICANN

ICANN is the new non-profit body responsible for domain name system management, IP address allocation, and related functions. ICANN was established last year to (a) phase out the government’s involvement in the domain name system and (b) to end the monopoly held by Network Solutions Inc. (Nasdaq: NSOL), by opening up the registration of such popular domains as “.com” and “.net” to additional companies. In the past year:

1.         An Internet tax ICANN sought to impose was rejected. ICANN had funding problems and sought to impose a charge on all new Internet domain names payable to ICANN. A Congressional committee started an investigation and ICANN backed down on this.

2.         Open meetings were initiated. ICANN was originally holding closed-door meetings. Criticisms erupted and ICANN appears to have changed its procedures and now holds open meetings.

3.         Criticism by Ralph Nadar’s organization:

Ralph Nader, a consumer rights advocate, challenges how ICANN’s power is controlled and proposes “that the group’s authority should be based on a multilateral government charter that clearly defines and limits the organization’s authority.” He has previously criticized the “beleaguered organization for catering to corporate interests and overextending its authority.”(40)

a.         Nader argues that the right to have an Internet domain name should be considered on par with the right to have a street address, a phone number, or a name.

b.         Nader wants ICANN’s internal documents and budget available to the public.

c.         Nader invites public comment to his thirteen point proposal(41) at mailto:ralph@essential.

4.         An additional controversy exists regarding the registration of domain names. A number of entrepreneurs have also tried to change the organization of the domain naming systems by allowing for the private ownership of new top level domain names. Their proposal is that private companies that create a top level domain name and are able to obtain market acceptance of it should own the rights to register and run the registry of those domain names. Although the White House at one time appeared to favor this approach, ICANN has, to date, rejected any such proposal.

5.         The U.S.P.T.O. weighs in. The “Green Paper” and the “White Paper” were drafted under Ira Magaziner’s direction when he was in the White House. Mr. Magaziner appeared to be somewhat sympathetic to the proposed market-oriented approach for adding top level domain names. Becky Burr,(42) at the Department of Commerce, now appears to be in charge of policies regarding these issues and seems opposed to the marketing approach of adding top level domain names.

The U.S.P.T.O., as of May 18, 1999, allows the registration of second level domain names stating on its Web site at http://www.uspto.gov/web/offices/tac/domain/tmdomain.htm:

An Internet domain name that is used to identify and distinguish the goods and/or services of one person, from the goods of and/or services of others, and to indicate the source of the goods and/or services may be registered as a trademark in the U.S.P.T.O.

On the other hand, the U.S.P.T.O. is hostile to the registration of top level domain names stating in its policy dated September 29, 1999 in Guide No. 2-99 available at http://www.uspto.gov/web/offices/tac/notices/guide299.htm:

If a mark is composed solely of a TLD for “domain name registry services” (e.g., the services currently provided by Network Solutions, Inc. of registering .com domain names), registration should be refused under Trademark Act §§1, 2, 3 and 45, 15 U.S.C. §§1051, 1052, 1053 and 1127, on the ground that it the TLD would not be perceived as a mark. The examining attorney should include evidence from the NEXIS® database, the Internet, or other sources to show that the proposed mark is currently used as a TLD or is under consideration as a new TLD.

If the TLD merely describes the subject or user of the domain space, registration should be refused under Trademark Act §2(e)(1), 15 U.S.C. §2(e)(1), on the ground that the TLD is merely descriptive of the registry services.

The U.S.P.T.O. has also rejected applications to register proposed top level domain names for services other than just “domain name registry services.” The writers are unaware of the U.S.P.T.O. granting any registrations of proposed top level domain names to date regardless of the services with which those proposed domain names are associated.

VI.     Privacy

The latest developments concerning privacy on the Internet relate to the passage of the Children’s Online Privacy Protection Act of 1998 and the effect of the European Privacy Directive.

A.        Legislation

The Children’s Online Privacy Protection Act of 1998 (COPPA), 64 Fed. Reg. 22750 (April 27, 1999), forbids the collection and distribution of minors’ personal information(43) without parental consent and restricts distribution and use of that information. This Act is intended to provide protection to the individually identifiable data of children as collected by Internet Service Providers or Web site operators. The Act is supposed to be implemented by FTC rules which should be in place between eighteen and thirty months from COPPA’s enactment. The FTC has not yet issued any final rules, but interim rules were proposed on April 20, 1999:

Of particular importance is the COPPA requirement that, with certain exceptions, Web sites obtain “verifiable parental consent” before collecting, using, or disclosing personal information from children. Section 312.5 of the proposed rule sets forth this requirement along with the following performance standard:

An operator must make reasonable efforts to obtain verifiable parental consent, taking into consideration available technology. Any method to obtain verifiable consent must be reasonably calculated, in light of available technology, to ensure that the person providing consent is the child’s parent. (64 Fed. Reg. 22756)

In its discussion of this section, the Commission identified a number of methods an operator might use to obtain verifiable parental consent, including a print-and-send form signed by the parent and mailed or faxed to the Web site; a credit-card transaction initiated by the parent; a call made by the parent to a toll-free number; or an e-mail accompanied by the parent’s valid digital signature. The Commission also solicited comment on whether there are other e-mail based mechanisms that could provide sufficient assurance that the person providing consent is the child’s parent. (64 Fed. Reg. 22756, 22762) (44)

B.        European Union Privacy Directive

The European Union (EU), in its European Union Privacy Directive,(45) has granted broad rights to individuals about whom personal information is collected and stored in databases. This EU position, based on the idea that privacy is a fundamental human right, is more rigorous than the United States’ position, which does not provide as extensive access to individuals to review this kind of information and has relatively few restrictions on the use of such personal information.(46) This conflict between the EU position and the US position has threatened international electronic commerce.(47) Therefore, the US Department of Commerce negotiated with EU representatives and proposed safe harbor principles for American companies to use in determining whether they comply with EU data protection laws.(48) The “safe harbor” arrangement is expected to be finalized in the fall of 1999. (49)

Major companies are now requiring sites in which they advertise to meet these standards and the proposed safe harbor provision. For example, IBM’s policy(50) on personal information states that it will inform the consumer how it will use the personal information collected:

At IBM, we intend to give you as much control as possible over your personal information. In general, you can visit IBM on the Web without telling us who you are or revealing any information about yourself. There are times, however, when we may need information from you, such as your name and address. It is our intent to let you know before we collect personal information from you on the Internet.

If you choose to give us personal information via the Internet that we or our business partners may need — to correspond with you, process an order or provide you with a subscription, for example – it is our intent to let you know how we will use such information. If you tell us that you do not wish to have this information used as a basis for further contact with you, we will respect your wishes. We do keep track of the domains from which people visit us. We analyze this data for trends and statistics, and then we discard it.

VII.        First Amendment: Child Online Protection Act

The Child Online Protection Act was held unconstitutional in ACLU v. Reno, 1998 U.S. District Lexis 18546 (E.D. Pa. 1998) and ACLU v. Reno, 31 F.Supp. 2d 473 (E.D. Pa. 1999), but there have not been any decisions from the appellate level yet.

VIII.      Jurisdictional Issues

A.        There have also been some interesting recent cases relating to jurisdiction. First, according to the Internet Newsletter, August 1999, a New York trial court has held that a gambling site in Antigua that would not allow gambling on the site if anyone gave an address in a state that prohibited gambling but did not take any other further steps to verify the address’ accuracy constituted a violation of New York State’s prohibitions on gambling and the Federal Wire Act, the Travel Act, and the Interstate Transportation of Wagering Paraphernalia Act. People v. World Interactive Gaming Corp., N.Y. Sup. Ct., N.Y. Co. (July 24, 1999).

B.        Coastal Video Communications Corp. v. Staywell Corp., 1999 U.S. Dist. LEXIS 11827 (E.D. Va. 1999). In a copyright case where one company alleged that its employee handbook had been infringed by another company, the District Court held that whether there was long-arm statute jurisdiction depended on whether the defendant had actually sold its publication, not just attempted to sell its publication, in Virginia. The Court also said that even if such copies were sold in Virginia, that would not be enough to grant specific jurisdiction in that case because the declaratory judgment action that had been filed does not “arise from the sale of the defendant’s publication” but rather from its very existence. Perhaps the lesson from this case, if you desire to get jurisdiction, is to file an infringement action in a copyright case instead of a declaratory judgment.

C.        Where a Virginia resident sued out of state defendants for posting allegedly defamatory material (one defendant posted the material on servers in Virginia via “AOL” and the other defendant posted the material on servers outside Virginia but was held by the Court to be doing business in Virginia from its Web site), a District Court for the Eastern District of Virginia held that there was a tort in the State of Virginia, and there were sufficient minimum contacts to allow for jurisdiction. Bochan v. LaFontaine, 1999 U.S. Dist. LEXIS 8253 (E.D. Va. 1999).

D.        In a similar case, Melvin v. Doe, Cir. Ct. of Loudoun County, Civil No. 21942 (June 24, 1999), a Virginia Court held that where both the plaintiff and the defendant were Pennsylvania residents, even though a tort may have occurred in Virginia by defamatory material being placed on the AOL server in Virginia, there were not sufficient minimum contacts to meet the jurisdiction requirements for personal jurisdiction.

E.         In Mink v. AAAA Dev., 1999 U.S. App. LEXIS 22783 (5th Cir. 1999), the Fifth Circuit articulated a structure for determining when a court can assume jurisdiction of a company with a presence in cyberspace.

1.         The Fifth Circuit followed the sliding scale in Zippos Mfg. Co. v. Zippo Dot Com, 952 F. Supp. 1119, 1124 (W.D. Pa. 1997), setting out three levels of Internet business. (51)

a.         First, companies which merely advertise or post information about their business on the Internet with “passive” Web sites cannot be sued out of state simply because they maintain the Web site. In Mink, the company’s Web site “provides users with a printable mail-in order form, AAAA’s toll-free telephone number, a mailing address, and an electronic mail (“e-mail”) address, [and] orders are not taken through AAAA’s website [sic]. This does not classify the website [sic] as anything more than a passive advertisement.” Mink at *7.

b.         The second category consists of companies whose Web site allows a user to exchange information with a host computer. Citing Zippos, the Court reasoned that “the exercise of jurisdiction is determined by the level of interactivity.” Mink at *7 – *8.

c.         The companies which enter into contracts with out-of-state residents that involve the “knowing and repeated transmission of computer files over the Internet,” can be sued in the home state of the out of state residents. Mink at *8 -*9.

IX.     Conclusion

We are now at the point where there are judicial precedents and/or proposed statutes resolving many previously troubling Internet issues. Future cases are likely to focus more on reconciling the conflicts between intellectual property rights and/or privacy rights, on one hand, and free speech rights, on the other hand.

END NOTES

(1) In Vault Corp. v. Quaid Software Ltd., 847 F.2d 255 (5th Cir. 1988), the Fifth Circuit, applying Louisiana law, held that the shrinkwrap license was unenforceable. In this case, the Plaintiff, Vault Corporation, developed software for Vault Corp.’s software developer customers to embed in their software to prevent their end user customers from using the software on more than one computer. When the Vault Corporation sold its software, it included a shrinkwrap license which was expressly authorized by a Louisiana statute and prohibited reverse engineering of the software. The defendant, Quaid, purchased the software and reversed engineered it. The Fifth Circuit held that the shrinkwrap license and the related statute were unenforceable because they were “pre-empted” by copyright law. The Court’s holding implies that if pre-emption does not apply, then the shrinkwrap license is enforceable. Most courts that have decided the issue have held that agreements prohibiting reverse engineering and disclosure of confidential information are not pre-empted by the Copyright Act because they involve an agreement between private consenting parties, and therefore are different from copyright which is imposed by statute. See, e.g., Computer Associates v. Altai, 982 F.2d 693 (2nd Cir. 1992).

(2) See, e.g., Feist Publications, Inc. v. Rural Telephone Company Service, 499 U.S. 340, 111 S. Ct. 1282, 113 L.Ed. 2d 358 (1991). For additional materials on copyright law, see the writers’ law firm Web site at http://www.internetlegal.com. There is some concern among commentators that to allow unlimited use of shrinkwrap and clickwrap licenses to protect material not otherwise protected by copyright law could vitiate the copyright fair use doctrine.

(3) This case also dealt with the enforceability of a limitations of remedies clause contained in a shrinkwrap license.

(4) See O.C.G.A. §10-12-2.

(5) A “secure electronic signature” is defined as “an electronic or digital method executed or adopted by a party with the intent to be bound by or to authenticate a record, which is unique to the person using it, is capable of verification, is under the sole control of the person using it, and is linked to data in such a manner that if the data are changed the electronic signature is invalidated.” O.C.G.A. §10-12-3.

(6) The Act provides, in Section 106, Legal Recognition of Electronic Records, Electronic Signatures, and Electronic Contracts

(a)        A record or signature may not be denied legal effect or enforceability solely because it is in electronic form.

(b)        A contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation.

(c)        If a law requires a record to be in writing, or provides consequences if it is not, an electronic record satisfies the law.

(d)       If a law requires a signature, or provides consequences in the absence of a signature, the law is satisfied with respect to an electronic record if the electronic record includes an electronic signature.

See UETA Sections 201, 301, and 401(a) (1998 Annual Meeting Draft); Uncitral Model Articles 5, 6, and 7.

(7) A copy of the proposed Act is available online at www.law.upenn.edu/library/ulc/ulc.htm

(8) The National Conference of Commissioners on Uniform State Laws (NCCUSL) and the American Law Institute (ALI) are responsible for overseeing updates to the Uniform Commercial Code. In 1995, a committee was formed to draft a separate UCC article to specifically address software licensing and electronic commerce. Various versions have been proposed and debated. The goal is to propose a version that most, if not all, of the state legislatures will adopt.

(9) UCITA was approved by the National Conference of Commissioners on Uniform State Laws (NCCUSL) at its annual meeting in Denver at the end of July, 1999. Foster, Ed, UCITA Author Does Some Moonlighting for Money, Courtesy of Microsoft, InfoWorld: The Gripe Line, Oct. 11, 1999.

(10) Graff, George L., Controversial Computer Act Offers Major Innovations: Proposed Uniform Statute for The Information Age Is Approved, Computer Law Strategist, Aug. 1999, Vol. XVI, No. 4.

(11) Id.

(12) See also http://www.ll.georgetown.edu/allwash/UCITA2html

(13) Spam is the name given for unsolicited e-mail messages which flood the Internet. Spam generally consists of commercial advertising (sometimes for adult oriented Web sites or get-rich-quick schemes).

(14) A copy of this Order is attached as Appendix A.

(15) See William M. McSwain, The Long Arm of Cyber-Reach, 112 Harv. L. Rev. ___ (Issue 7, May, 1999).

(16) See, CompuServe, Inc. v. Cyber Promotions, Inc., 962 F.Supp. 1015 (S.D. Ohio 1997) in which the court held that enjoining the sending of spam to CompuServe’s customers was based on a trespass action that didn’t involve First Amendment considerations.

(17) See Central Hudson Gas & Elec. Corp. v. Public Serv. Comm’n of N.Y., 447 U.S. 557, 562-563, 65 L.Ed.2d 341, 100 S.Ct. 2343 (1980).

(18) Cf. Sable Communications v. FCC, 492 U.S. 115, 127-128, 109 S.Ct. 2829, 2837, 106 L.Ed.2d 93 (1989) (there is no captive audience problem where the listener of dial-a-porn must take affirmative steps to receive the communication).

(19) See Intel v. Hamidi, supra.

(20) In similar cases, the First Amendment issue was not raised. See, e.g., America Online v. IMS, 24 F. Supp. 2d 548 (E.D. Va. 1998); America Online v. Prime Data Sys., Inc., 1998 U.S. Dist. LEXIS 20226 (E.D. Va. 1998); America Online v. LCGM, Inc., 46 F. Supp. 2d 444 (E.D. Va 1998).

(21) The text is attached as Appendix B.

(22) Because this language is written broadly enough to prevent noncommercial anonymous bulk e-mailings, it arguably violates the First Amendment. See, ACLU of Georgia v. Miller, 977 F.Supp. 1228 (N.D. Ga. 1997).

(23) The Act defines the term “unsolicited electronic mail message” as “any substantially identical electronic mail message other than electronic mail initiated by any person to others with whom such person has a prior relationship, including prior business relationship, or electronic mail sent by a source to recipients where such recipients, or their designees, have at any time affirmatively requested to receive communications from that source.”

(24) Nev. Rev. Stat. 41.735 provides immunity for persons who provide users with access to a network and applies to items of electronic mail obtained voluntarily.

(25) Nev. Rev. Stat. 41.715 defines “electronic mail” as a message, a file or other information that is transmitted through a local, regional or global network, regardless of whether the message, file or other information is:

1. Viewed;

2. Stored for retrieval at a later time;

3. Printed onto paper or other similar material; or

4. Filtered or screened by a computer program that is designed or intended to filter or screen items of electronic mail.

(26) Cal. Business & Professions Code §17538.4 provides as follows:

(a) No person or entity conducting business in this state shall facsimile (fax) or cause to be faxed, or electronically mail (e-mail) or cause to be e-mailed, documents consisting of unsolicited advertising material for the lease, sale, rental, gift offer, or other disposition of any realty, goods, services, or extension of credit unless:

(1) In the case of a fax, that person or entity establishes a toll-free telephone number that a recipient of the unsolicited faxed documents may call to notify the sender not to fax the recipient any further unsolicited documents.

(2) In the case of e-mail, that person or entity establishes a toll-free telephone number or valid sender operated return e-mail address that the recipient of the unsolicited documents may call or e-mail to notify the sender not to e-mail any further unsolicited documents.

(b) All unsolicited faxed or e-mailed documents subject to this section shall include a statement informing the recipient of the toll-free telephone number that the recipient may call, or a valid return address to which the recipient may write or e-mail, as the case may be, notifying the sender not to fax or e-mail the recipient any further unsolicited documents to the fax number, or numbers, or e-mail address, or addresses, specified by the recipient.

In the case of faxed material, the statement shall be in at least nine-point type. In the case of e-mail, the statement shall be the first text in the body of the message and shall be of the same size as the majority of the text of the message.

(c) Upon notification by a recipient of his or her request not to receive any further unsolicited faxed or e-mailed documents, no person or entity conducting business in this state shall fax or cause to be faxed or e-mail or cause to be e-mailed any unsolicited documents to that recipient.

(d) In the case of e-mail, this section shall apply when the unsolicited e-mailed documents are delivered to a California resident via an electronic mail service provider’s service or equipment located in this state. For these purposes “electronic mail service provider” means any business or organization qualified to do business in this state that provides individuals, corporations, or other entities the ability to send or receive electronic mail through equipment located in this state and that is an intermediary in sending or receiving electronic mail.

(e) As used in this section, “unsolicited e-mailed documents” means any e-mailed document or documents consisting of advertising material for the lease, sale, rental, gift offer, or other disposition of any realty, goods, services, or extension of credit that meet both of the following requirements:

(1) The documents are addressed to a recipient with whom the initiator does not have an existing business or personal relationship.

(2) The documents are not sent at the request of, or with the express consent of, the recipient.

(f) As used in this section, “fax” or “cause to be faxed” or ” e-mail” or “cause to be e-mailed” does not include or refer to the transmission of any documents by a telecommunications utility or Internet service provider to the extent that the telecommunications utility or Internet service provider merely carries that transmission over its network.

(g) In the case of e-mail that consists of unsolicited advertising material for the lease, sale, rental, gift offer, or other disposition of any realty, goods, services, or extension of credit, the subject line of each and every message shall include “ADV:” as the first four characters. If these messages contain information that consists of unsolicited advertising material for the lease, sale, rental, gift offer, or other disposition of any realty, goods, services, or extension of credit, that may only be viewed, purchased, rented, leased, or held in possession by an individual 18 years of age and older, the subject line of each and every message shall include “ADV:ADLT” as the first eight characters.

(h) An employer who is the registered owner of more than one e-mail address may notify the person or entity conducting business in this state e-mailing or causing to be e-mailed, documents consisting of unsolicited advertising material for the lease, sale, rental, gift offer, or other disposition of any realty, goods, services, or extension of credit of the desire to cease e-mailing on behalf of all of the employees who may use employer-provided and employer-controlled e-mail addresses.

(i) This section, or any part of this section, shall become inoperative on and after the date that federal law is enacted that prohibits or otherwise regulates the transmission of unsolicited advertising by electronic mail (e-mail).

(27) See Digital Millenium Copyright Act, Sec. 1201. Circumvention of copyright protection systems.

(28) Digital Performance Right in Sound Recordings Act of 1995 (Public Law 104-39).

(29) The Rio portable music player is a digital audio recording device. The Rio is a small device (roughly the size of an audio cassette) with headphones that allows a user to download MP3 audio files from a computer and to listen to them elsewhere.

(30) See 17 U.S.C. §1001 et seq. (P.L. 102-563, at 4, 106 Stat. 4248).

(31) Discord Surrounding Diamond Multimedia’s Rio Player is Ended Through Settlement Agreement, The Intellectual Property Strategist, Sept. 1999, Volume 1, Number 12, at 4.

(32) See P.L. 105-298, 112 Stat. 2827.

(33) Eric Eldred founded Eldritch Press in late 1995, and initially, Eldritch Press posted works of American literature by authors such as Nathaniel Hawthorne and Henry James. Now, Eldritch Press posts new works the moment they enter the public domain. Some of the works Eldritch Press posts are out of print or are not included in library collections, and therefore they are not obtainable by the public in any other way. See How Long is Too Long? Recent Congressional Copyright Giveaway Claimed Unconstitutional at http://eldred.ne.mediaone.net/pr-1999-01-12.txt.

(34) See Eldred v. Reno, United States District Court for the District of Columbia, Case No. 1:99CV00065 JLG (filed January 11, 1999). Visit this Web site to view the pleadings in this case: http://cyber.law.harvard.edu/eldredvreno/legaldocs.html.

(35) See http://www.kingkong.demon.co.uk/ccer/ccer.htm, a site that documents all renewals of 1923 book copyrights, representing works that the Copyright Term Extension Act keeps from the public domain.

(36) Slotek, Jim, M-I-C . . . © you real soon . . . k-e-y . . ., Toronto Sun Times, Nov. 1, 1998; see also Naughton, John, Mickey Mouse Saved for Disney? Phew. What a Narrow Squeak, Guardian Unlimited, May 2, 1999.

(37) As found by the Court, Playboy Enterprises (PEI):

owns federally registered trademarks for the terms Playboy, Playmate, Playmate of the Month, and Playmate of the Year. The term Playmate of the Year is sometimes abbreviated “PMOY.” PEI does not have a federally registered trademark in the abbreviation “PMOY,” although PEI argues that “PMOY” is worthy of trademark protection because it is a well-known abbreviation for the trademark Playmate of the Year.

Playboy Enterprises, 7 F.Supp.2d 1098, 1100.

(38) The Court also found that, with respect to the meta tags, there is no trademark infringement where defendant has used Playboy’s trademarks in good faith to index the content of her Web site.

(39) This statute would allow a court to order the cancellation or forfeiture of the domain name or the transfer of the name to the owner of the trademark. It will make it possible for plaintiffs to go after domain names as a group rather than being forced to sue each of the registrants individually. See Porsche Cars North America, Inc. v. porsch.com, 51 F. Supp. 2d 707 (E.D. Va. 1999), 51 U.S.P.Q.2d (BNA)1461, in which the Court rejected Porsche’s “in rem” claim to grab control of domain names incorporating versions of the “Porsche” name to avoid having to individually sue hundreds of registrants that had registered those domain names.

(40) Mack, Jennifer, Nader Proposes Limits to ICANN, ZDNet News, Sept. 27, 1999.

(41) A framework for ICANN and DNS Management

Initial Proposals (comments welcome)

version 1.02 September 25, 1999

1. ICANN’s authority should be based upon a multilateral government charter. That Charter should define and limit ICANN’s authority.

2. The charter should be based upon a limited purpose sui generis agreement among countries that express interest in working together, and that agree that ICANN’s role should be limited to tasks essential to maintaining an efficient and reliable DNS management, and that ICANN will not be used as an instrument to promote policies relating to conduct or content on the Internet. (Additional multilateral institutions may be desired to address electronic commerce issues, but ICANN itself should not become the foundation for a vast Internet governance institution. See http://www.cptech.org/ecom/cpt-wcpo.html)

3. ICANN should not use its power over domain registration policy to exclude persons from the use of a domain on issues that are not germane to managing the DNS system of mapping IP addresses into domain names. The right to have a domain on the Internet should be considered the same as the right to have a street address, a telephone number or a person’s name.

4. ICANN should identify a membership and elect its board of directors from its membership before it makes additional policy decisions (in those areas appropriate for action by ICANN).

5. Membership should be open to anyone who uses the Internet. There should be no fee associated with membership or voting rights.

6. The records of ICANN should be open to the public. The public should have rights to documents as, similar to rights provided in the US Freedom of Information Act.

7. The meetings of ICANN should be open to the public.

8. The public should be given an annual opportunity to review and comment on the ICANN budget.

9. The budget of ICANN should be subject to review by the countries that provide the ICANN charter. Fees associated with domain registration should only be spent on activities essential to the management of the DNS system.

10. National governments should be permitted to exercise discretion over policies relating to the use of country top level domains (.fr, .uk, .us, etc.).

11. For generic top level domains (.com, .org, .net, and new gTLDs), the domain space should be declared a public resource. The registrar or registries perform services on behalf of the users of the domains, and will not own the domain space. It should be possible to replace firms engaged in registration services and DNS management, without risking the stability of the Internet.

12. On matters of public interest (in the narrow areas where ICANN will operate), such as policies regarding the use of trademarks or the privacy of domain registration information, ICANN should make recommendations to the sui generis multinational body created to manage ICANN, and the multinational body should accept, reject or modify the recommendations, after giving the public a fully adequate opportunity to review and comment on the proposals.

13. On the issue of trademarks, the Charter should explicitly protect the public’s rights to parody, criticism and free speech. For example, domain names like GM-sucks.com, which would not be confused with GM.com, should be permitted.

(42) Becky Burr is the Associate Administrator of the National Telecommunication and Information Administration, Office of International Affairs.

(43) The Act defines “personal information” to include an individual’s first and last name, home and other physical address, e-mail address, social security number, and telephone number. 1999 S. 809; 106 S. 809.

(44) See Benjamin I. Berman, Acting Secretary of the Federal Trade Commission, Federal Register Notice announcing Public Workshop on Proposed Regulations Implementing the Children’s Online Privacy Protection Act, Supplementary Information, June 23, 1999, 16 C.F.R. Part 312, Children’s Online Privacy Protection Rule at http://www.ftc.gov/os/1999/9906/kidsprivacy.htm.

(45) For the official text of the European Union Privacy Directive, see Official Journal of the European Communities of 23 November 1995 No L. 281 p. 31. For an unofficial version, visit http://www.cdt.org/privacy/eudirective/EU_Directive_.html.

(46) See, e.g., Mosceyunas, Anne K., On-Line Privacy: The Push and Pull of Self-Regulation and Law, Computer Law Section Newsletter, State Bar of Georgia, July, August, September, 1999, pp. 13-15; Cranman, Kevin A., Internet and Electronic Communication Privacy Issues: An Overview and Legislative Update, 14th Annual Computer Law Institute, Program Materials 1999, Part 10.

(47) Winn, Jane K., Digital Signatures, Smart Cards, and Electronic Payment Systems, ICLE Fourteenth Annual Computer Law Institute, Sept. 24, 1999, p. 22.

(48) See Joint Report on Data Protection Dialogue to the EU/US Summit, June 21, 1999, which is attached as Appendix C.

(49) Id.

(50) See http://www.ibm.com/privacy/.

(51) For further analysis, see Koppel, Nathan, Cyber-Ad Jurisdiction Isn’t Automatic, Texas Lawyer, Sept. 27, 1999.

The information above is provided for general educational purposes and not as legal advice. Laws in areas in which we practice change continually and also vary from jurisdiction to jurisdiction. Therefore no visitor to our site should rely on any of the articles provided for legal advice, but should always consult their own attorney regarding legal matters.

© 1999, Rob Hassett, Atlanta, Georgia. All Right Reserved.

Cybersquatting: The New Age of URLs and Their Impact on Trademarks

By Rob Hassett and Suellen Bergman

Hassett Cohen Goldstein & Port, LLP
990 Hammond Drive, Suite 990
Atlanta, GA 30328
(770) 393-0990
http://www.internetlegal.com

I. Introduction

The Internet is a source of frequent disputes regarding the use of trademarks and service marks as domain names. This paper addresses the cases and statutes relating to these issues.

II. Infringement and Dilution Decisions

The following is a sample of Internet-related cases concerning trademark infringement and trademark dilution.1 These cases first address trademark uses on the Internet which are clearly prohibited, then cases that are closer questions, and finally uses of another’s trademark that are clearly legal.

A.  Domain Names, Metatags or Marks in a Site Which Could Confuse the Public

1. Courts usually prohibit trademark uses where consumers are likely to be confused because two marks are similar and used in the same channels of trade. See Playboy Enter. v. Calvin Designer Label, 985 F. Supp. 1218 (N.D. Cal. 1997).

2. Even when marks are not used in the same channels of trade, courts may restrict the use of similar marks in the Internet arena. “[W]ith respect to Internet service, even services that are not identical [but which do use similar trademarks] are capable of confusing the public.”2 See GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1207 (9th Cir. 2000) (finding that Disney’s “Go Network” logo infringed the plaintiff’s “GoTo” Web site logo, and that even if Disney limited its search portal to the entertainment and leisure areas, Disney’s logo could still be confused with plaintiff’s “GoTo” site because both Web sites feature a search engine).3

B. Dilution of Famous Marks (Federal Anti-dilution Act enacted in 1996)

Where a mark has become “famous” it is entitled to protection not only from “confusion” but also from tarnishment and blurring. For example, it is not likely that customers using the adult site “Adults ‘R’ US” thought that the site was operated by or associated with “Toys ‘R’ US.” As discussed below, the use of that domain name was nevertheless illegal.

1. Toys “R” US, Inc. v. Adults “R” US, 1996 U.S. Dist. LEXIS 17090, 40 U.S.P.Q.2d (BNA) 1836 (N.D. Cal. 1996). The Court awarded a preliminary injunction to Toys “R” Us, finding that its marks are famous and distinctive and, thus, eligible for protection from dilution under 15 U.S.C. § 1125. The Court also enjoined the defendants from using “Adults ‘R’ Us” because it tarnishes the “‘R’ Us” family of marks by “associating them with a line of sexual products that are inconsistent with the image Toys ‘R’ Us has striven to maintain for itself.” 1996 U.S. Dist. LEXIS 17090 at *7.

2. Similarly, in Mattel Inc. v. Internet Dimensions Inc., et al., 2000 U.S. Dist. LEXIS 9747, 55 U.S.P.Q.2d (BNA) 1620 (S.D.N.Y. 2000), the Court granted an injunction against the defendant barring further use of Mattel’s trademark “Barbie” and ordered that the domain name barbiesplaypen.com, which the defendant had used for pornographic photos, be transferred to Mattel.4

3. Ringling Bros.-Barnum & Bailey Combined Shows v. Utah Div. of Travel Dev., 170 F.3d 449, 50 U.S.P.Q.2d (BNA) 1065 (4th Cir. 1999), held that Ringling Brothers could not prevent the state of Utah from using “The Greatest Snow on Earth” as a slogan for Utah’s winter sports attractions. The Court determined that the Federal Anti-dilution Act required a showing of “actual economic harm” to the famous marks’ value by lessening its selling power as an advertising agent for its goods or services.5 Proof of this harm should be demonstrated by conducting surveys and by showing actual loss, but was not shown in this case.

C. Cybersquatting: The First Cybersquatting Cases (Registering Domain Names With the Sole Intent to Resell Them)

1. Panavision, Int’l, L.P. v. Toeppen, 945 F. Supp. 1296, 40 U.S.P.Q.2d (BNA) 1908 (C.D. Cal. 1996). The Court found that defendant’s registration of a domain name, which was identical to the plaintiff’s trademarks, in order to sell the domain name to the trademark owner constituted trademark dilution.

2. Accord Intermatic, Inc. v. Toeppen, 947 F. Supp. 1227, 41 U.S.P.Q.2d (BNA) 1223 (N.D. Ill. 1996), aff’d, (9th Cir. 1998). The plan to resell the domain name was determined to be “commercial use” which is required to constitute dilution.

D. Hijacking (Registering of Competitor’s Domain Name)

1. Until recently, registration of a competitor’s mark as a domain name (hijacking) was legal: see Juno Online Servs., L.P. v. Juno Lighting, Inc., 979 F. Supp. 684 (N.D. Ill. 1997), 44 U.S.P.Q.2D (BNA) 1913. See also HQM Ltd. and Hatfield Inc. v. William B. Hatfield, 71 F. Supp. 2d 500 (D. Md. 1999) (holding that the registering a Web site with the “.com” designation and activating it for e-mail does not, by itself, constitute commercial use). Hijacking with “bad faith intent to profit” is now illegal under the recently enacted Anticybersquatting Act, discussed below.6

2. The Barcelona City Council in Spain filed a complaint with the World Intellectual Property Organization (WIPO)7 against a tourism company which had registered Barcelona.com. The tourism company claimed that this was a case of “reverse hijacking.” The WIPO panel rejected this claim and awarded the Barcelona.com domain name to the City Council. The panel decided that the City Council had “better rights” to the name than the tourism company because Internet users looking for information about Barcelona would expect to reach an official representative or agency of the city of Barcelona. Furthermore, the WIPO panel determined that the tourism company was taking advantage of the public’s confusion and was therefore guilty of bad faith.8 This decision not only puts into question the rights of those who own geographic domain names, but also has been the subject of much criticism.9 The tourism company plans to challenge this decision by filing a new action in a United States court.10 Contra Kur-und Verkehrsverein St. Moritz v. StMoritz.com, where the complainant, an official organization of the town of St. Moritz did not obtain the domain name stmoritz.com.11 The respondent used the domain name to present information about St. Moritz and Switzerland, and, therefore the WIPO arbitrator found that the respondent lacked bad faith and may have a right or legitimate interest with respect to the name.12

E.  Deep Linking Which Creates Confusion

One of the Internet’s most useful features is the ability to directly connect from one Web site to another. A user makes this connection by clicking on an icon or words, called a “hyperlink” or “link.” Linking is not only an essential aspect of the Internet, but it is beneficial to users because it enables them to quickly find information on topics of interest. Likewise, it benefits Web site owners by increasing visits or traffic to their Web site, and therefore Web site operators sometimes encourage links to their site. For example, some Web sites encourage linking if the link is not confusing or misleading, and have policies which permit linking in certain circumstances: www.gateway.com and www.bellatlantic.com.

There are some instances, however, where the link is constructed in a manner that confuses or misleads the user by implying that the linked Web sites have an affiliation, such as endorsement or sponsorship. Those instances give rise to legal disputes.

1. Ticketmaster Corp. v. Tickets.com, Inc., 2000 U.S. Dist. LEXIS 4553, 54 U.S.P.Q.2d (BNA) 1344, (C.D. Ca. 2000). Tickets.com operates a Web site which provides information about sporting and entertainment events. Tickets.com’s Web site linked a user directly to the Ticketmaster Web page where a user can order tickets to the posted events. This kind of connection, where the link directs the user to an interior page of another Web site and bypasses the linked-to Web site’s home page, is known as “deep linking.” In Ticketmaster, the Court held that linking to another Web site does not in itself constitute a violation of the Copyright Act. The Court reasoned that the linking function does not actually involve copying material from the copyright owner’s Web site because the user is “automatically transferred to the particular genuine Web page of the original author.” Ticketmaster, 2000 U.S. Dist. LEXIS 4553 at *6. Therefore, the Court dismissed Ticketmaster’s copyright infringement claim. Id. at *4.

However, the Court denied defendant’s motion to dismiss Ticketmaster’s claims of unfair competition and trademark infringement because of plaintiff’s allegations that Tickets.com falsely implied an association with Ticketmaster through deep linking. Thus, this decision suggests that where linking causes a likelihood of confusion as to the source or sponsorship of a Web site or of goods or services offered on a Web site, the linking can constitute unfair competition. Deep linking can cause problems for the linked-to Web site if its advertisers pay on the “basis of the number of ‘hits’ on the home page, [because the advertiser] will not pay for deep-linked reference to the interior home page. Further, the allegation is made that bypassing the home page enables the customer to avoid the terms and conditions, which are not available to him on the [deep linked] events page.”13

2. Ticketmaster Corp. v. Microsoft, Inc., CV 97-3055 RAP (C.D. Cal. filed April 28, 1997). Ticketmaster filed a similar lawsuit against the Microsoft Corporation, claiming that Seattle Sidewalk, Microsoft’s online entertainment guide, illegally linked to its Web site.14 The parties settled this case in March 2000.

F. Registering the Domain Name That is a Mark (Not Necessarily the Mark of a Competitor)

Registering a domain name with “intent to profit” would now be illegal under the Anticybersquatting Act (which created a new §43(d) of the Lanham Act, 15 U.S.C. §1125(d)). Before the Anticybersquatting Act was enacted, registering a domain name — without more — would not constitute either “use in commerce” or “commercial use,” which was required under the Lanham Act to establish a violation. See National Westminster Bank PLC v. Purge I.T., et al., WIPO Case No. D2000-0636 (transferring natwestsucks.com to the trademark owner where there was bad faith evidence of attempting to “ransom” the domain name, even though the domain name had never been used).

G. Registering a Domain Name That is a Common Word or Mark

Cello Holding v. Lawrence-Dahl Companies, 89 F.Supp. 2d 464, 54 U.S.P.Q.2d 1645 (S.D.N.Y. 2000) (summary judgment denied to Plaintiff because many companies use “cello” as a mark and it is a common word).

H. Using Mark to Criticize a Product or Service (Rather Than to Actually Sell Products or Services)

Disenchanted consumers vent frustrations about a given company on the Internet, frequently on a “sucks site” which targets particular companies. The most well-known such forums are Starbucked, Aolsucks, and noamazon.com.15 If such a site uses a company’s trademark for noncommercial criticism, it runs afoul of trademark law if it confuses or tricks consumers into believing that the site is sponsored or affiliated with the company.16 On the other hand, parody is legal if the parody is sufficiently distinguishable from the original to be recognizable as a parody (i.e. the parodist will likely lose a case if he is using the parody to promote a product related to the original) and where there is a meaningful connection between the subject of the parody and the ultimate message.17

1. In Bally Total Fitness Holding Corp. v. Faber, 29 F. Supp.2d 1161, 50 U.S.P.Q. 2d (BNA) 1840 (C.D. Cal. 1998), the defendant used Bally’s trademark in a Web site entitled “Bally sucks,”18 which criticized the service at Bally’s fitness centers. The District Court dismissed Bally’s suit because the defendant’s use of Bally’s mark did not create a likelihood of confusion or otherwise constitute trademark infringement or dilution.

2. While it should be obvious to an Internet user that a “sucks” domain name is not the company’s official Web site and that the company has not sponsored that Web site, some recent cases have nevertheless ordered that “sucks” domains be transferred to the trademark owner. However, in some of those cases, the requisite bad faith evidence was present. For example, Wal-MartCanadaSucks.com and WalMartPuertoRicoSucks.com were transferred to Wal-Mart Stores, Inc. in an ICANN arbitration (discussed infra) decision.19 While the registrar of those sites contends that he used those sites to solicit consumer complaints about Wal-Mart, the arbitrator noted that at one point he “demanded ‘consulting fees’ from Wal-Mart in return for having alerted the company to the availability of several other domain names based on its moniker.”20

3. In People for the Ethical Treatment of Animals, Inc. v. Doughney, CA No. 99-1336-A, E.D. Va., June 12, 2000, the animal rights organization was awarded the domain name peta.org, which was registered by the defendant for the fictional organization People Eating Tasty Animals. The Court rejected defendant’s parody and trademark misuse defense stating that no parody existed (since an Internet user would not know that he was not at PETA’s official Web site until after using PETA’s mark to access the Web site and “a parody exists when two antithetical ideas appear at the same time”).21

4. A complaint has been filed against several domain names which purport to protest Guinness Beer: Guinness-Sucks.com, Guinness-Beer-Sucks.com, Guinness-Beer-Really-Sucks.com, Guinness-Beer-Really-Really-Sucks.com, and variations of the above addresses without the hyphens.22

5. Verizon Communications attempted to preempt a “sucks” parody site and itself registered “verizonsucks.com”23 as well as fifty-six other self-critical names.24 Nevertheless, Web publisher 2600.com registered “verizonreallysucks.com” and promptly received a cease and desist letter.25 Consequently, 2600.com responded by registering the name “VerizonShouldSpendMoreTimeFixingItsNetworkAndLessMoneyOnLawyers.com.”26 Verizon stated that it’s goal was to act against approximately two hundred genuine cybersquatters who had registered Verizon related names with the hope of selling them, so Verizon’s legal department sent warning letters to everyone, including 2600.com.27 Verizon’s spokesperson Larry Plumb said that 2600.com was the one exception and “once we saw it met the standards of fair use, we decided not to pursue it. We’re out to defend our brand against confusion and dilution, not squelch free speech.”28

I. Use of Mark to Communicate or Describe Truth About a Site

Playboy Enters., Inc. v. Welles, 7 F.Supp.2d 1098, 47 U.S.P.Q.2D (BNA) 1186, (S.D. Ca. 1998), aff’d, 1998 U.S. App. LEXIS 27739 (9th Cir. 1998). A former playmate was permitted to state her association with Playboy Enterprises, Inc. (PEI) 29 on her own Web site. The heading of the defendant’s Web site is “Terri Welles–Playmate of the Year 1981,” and the title of the link page is “Terri Welles–Playboy Playmate of the Year 1981.” Each page uses “PMOY ’81” as a repeating watermark in the background. According to defendant, eleven of the fifteen free Web pages include a disclaimer at the bottom of the page which indicates that the Web site is not endorsed by Playboy. Id. at 1100. Playboy moved for a preliminary injunction which would enjoin the defendant (1) from using the trademarked term “Playmate of the Year” in the title of the home page and the link page; (2) from using the watermark “PMOY ’81” in the background; and (3) from using the trademarked terms “Playboy” and “Playmate” in the meta-tagging 30 of defendant’s site. The Court denied a preliminary injunction because the trademarks that defendant uses, and the manner in which she uses them, describe her and identify her. Therefore, the Court held that the defendant has made a “fair use” of these marks 31 and her site is not confusingly similar to Playboy’s site.

Later, the Court granted the defendant’s motion for summary judgment, holding that the use of the words “playboy” and “playmate” in the text portion of her Web site was a fair use of Playboy’s trademarks because they fairly described and identified the defendant.32 The Court noted that Playboy failed to introduce compelling evidence of actual consumer confusion.33 Compare N.V.E. v. Hoffmann-La Roche, CA No. 99-5858 (D.N.J. 1999) (WHW) (the District Court enjoined metatagging where the metatag misdirected searchers to a competing Web site).34

J. Other Uses of a Mark (Linking Searches on Search Engines to Banner Ads)

Playboy Enters., Inc. v. Netscape Communications Corp., 55 F. Supp. 2d 1070 (C.D. Ca. 1999) aff’d without opinion, 1999 U.S. App. LEXIS 30215 (9th Cir. 1999). This case involves the sale of online banner ads keyed to the specific search terms: “playboy” and “playmate.” The Court ruled that the terms “playboy” and “playmate” are generic and that Playboy has no monopoly on these words in all forms. Consequently, the Court denied Playboy’s request for a preliminary injunction against Excite, Inc. and Netscape. The Court held that the sale of banner ads which keyed “playboy” and “playmate” to third-party advertisers which operate adult entertainment sites does not constitute trademark infringement or dilution. On September 14, 2000, the District Court granted the defendants’ motion for summary judgment. Playboy Enters., 2000 U.S. Dist. LEXIS 13418 (C.D. Cal. 2000).

K. Registering of Common Surnames

1. Avery Dennison Corp. v. Sumpton, 189 F.3d 868, 51 U.S.P.Q.2D (BNA) 1801 (9th Cir. 1999). This was an appeal by the defendant, an entity that maintained domain registrations for individual names. The defendant had registered many surnames, including “Avery.net” and “Dennison.net.” Avery Dennison Corporation claimed these registrations diluted the “Avery Dennison” mark. The Ninth Circuit reversed the District Court’s holding that there was dilution. The Ninth Circuit held that:

a. The Avery Dennison mark was not famous because it was not “truly prominent and renowned” so that even marks “with such powerful consumer associations and even non-competing users can impinge on their value.” Avery, 189 F.3d 868, 875. The Court noted that there were many registrations of marks and uses of the marks “Avery” and “Dennison” by others, and this factor weighs against those being famous marks.

b. The Court also said that although “an intent to arbitrage” constituted a commercial use, an intent to “capitalize on the surname status of ‘Avery’ and ‘Dennison’ did not constitute a commercial use of a mark.” Id. at 880.

2. Other domain name decisions have favored the “smaller” party. See, e.g., Hasbro, Inc. v. Clue Computing, Inc., 66 F. Supp. 2d 117, 52 U.S.P.Q.2D (BNA) 1402 (D. Mass. 1999) [holding that ownership of a well-known trademark (the mark “clue” for a board game) does not automatically entitle a party to a domain name (“clue.com” which Clue Computing registered)].35

L. Generic and Descriptive

The Federal Circuit held that the slogan “Best Beer in America” was incapable of registration as a trademark because of its highly laudatory and descriptive nature. In re Boston Beer Co. Ltd. Partnership, 198 F.3d 1370, 53 U.S.P.Q. 1056 (Fed. Cir. 1999).36 But see Etoys.com v. etoy.com, Los Angeles Superior Court, preliminary injunction issued Nov. 29, 1999.37

III. Cybersquatting

A. The Anticybersquatting Consumer Protection Act

On November 29, 1999, President Clinton signed the Omnibus Appropriations Act (H.R. 3194). This Act includes the Intellectual Property and Communications Omnibus Reform Act of 1999 (S. 1948), which incorporates, inter alia, the Anticybersquatting Consumer Protection Act, 15 U.S. C. § 1125(d), attached hereto as Exhibit A. The Act amends Section 43 of the Lanham Act to add a subsection (d), and focuses on domain name registrants who acquire a domain name containing a trademark “with a bad-faith intent to profit” from the use of such mark. In particular, the amendment authorizes a private cause of action by the owner of a mark against anyone who, with a bad-faith intent to profit, registers, traffics in, or uses a domain name that:

is identical or confusingly similar to a mark that is distinctive at the time of registration of the domain name, is identical or confusingly similar to or dilutive of a famous mark that is famous at the time of registration of the domain name, or is a trademark, word, or name protected by reason of section 18 U.S.C. § 706,38 or 36 U.S.C. § 220506.39

The statute, at 15 U.S.C. §1125(d)(I)(B), provides a non-exhaustive list of nine factors a court may consider in determining “bad faith.”40 These factors are suggestive of the factual circumstances the courts should consider in determining whether the alleged infringing domain name, and the acts of the holder of the allegedly infringing domain name, encroach upon the range of rights granted to a trademark holder. Thus, a court is to consider evidence of whether the domain name holder has property rights in the mark; whether the site is commercial or non-commercial in nature; whether there is evidence that the domain name harms the good will of the registered mark; whether the domain name holder (who has not used or intended to use the domain name) has offered to sell the domain name to the holder of the mark; and whether the domain name holder has a pattern of registering multiple domains which the holder knew were the marks of others.

In addition, the Anticybersquatting Consumer Protection Act:41

1. Allows parties to bring an in rem action42 against any owner of a domain name that has been registered in violation of the Act and,

2. Permits obtaining injunctive relief and damages from those who, “with bad faith intent to profit,”43 register domain name identifiers which are identical or similar to a trademark; in lieu of actual damages, the trademark holder can recover damages of at least $1,000.00, but not more than $100,000 per domain name identifier. The court can order that the defendant transfer the domain name to a successful plaintiff. See, e.g., Lozano Enter. v. La Opinion Publ’g Co., 1997 U.S. Dist. LEXIS 20372, 44 U.S.P.Q.2d (BNA) 1764 (C.D. Cal. 1997).

3. Registering a domain name with “intent to profit” would now be illegal under the Anticybersquatting Act (which created a new §43(d) of the Lanham Act, 15 U.S.C. §1125(d)). Previously, registering a domain name without more would not constitute either “use in commerce” or “commercial use” as was previously required under the Lanham Act to establish a violation.

B. Multiple Defendants (In Rem Proceedings)

The Anticybersquatting Act, infra, allows a court to order the cancellation or forfeiture of a domain name or the transfer of a name to the owner of the trademark. It is now possible for plaintiffs to pursue domain names as a group rather than being forced to sue each of the registrants individually.

1. In Porsche Cars North America, Inc. v. porsche.com, 51 F. Supp. 2d 707, 51 U.S.P.Q.2d (BNA) 1461 (E.D. Va. 1999), the Court rejected Porsche’s in rem claim to grab control of domain names incorporating versions of the “Porsche” name. The in rem action was an effort to avoid having to individually sue hundreds of registrants who had registered those domain names. However, on June 9, 2000, the Fourth Circuit Court of Appeals vacated and remanded this decision since the District Court did not consider the effect of the Anticybersquatting Act. See Porsche Cars North America, Inc. v. allporsche.com, et al., 2000 U.S. App. LEXIS 12843, 55 U.S.P.Q.2d (BNA) 1158 (4th Cir. 2000).

2. Bad faith is required for a plaintiff to use the in rem provisions of the Anticybersquatting Act. See Harrods Ltd. v. Sixty Internet Domain Names, 2000 U.S. Dist LEXIS 11911 (E.D. Va. 2000).

C. Validity of the Anticybersquatting Act

Victims of cybersquatting are taking advantage of this new Act, which has been upheld on appeal. Sporty’s Farm LLC v. Sportsman’s Market Inc., 202 F.3d 489 (2d Cir. 2000) (the Court held that the defendant’s use of sports.com was indistinguishable from the “Sport’s” trademark, that Sporty’s Farm acted with a bad faith intent to profit because it had not made use of the “sporty’s” mark before registering it as a domain name, and it planned to use the Web site to directly compete with Sportsman).44 

IV. ICANN (Internet Corporation for Assigned Names and Numbers)

A. Proposed Addition Of New Top Level Domain Names

ICANN is the non-profit body responsible for domain name system management, IP address allocation, and related functions. ICANN was established last year to (a) phase out the government’s involvement in the domain name system and (b) to end the monopoly held by Network Solutions Inc. (Nasdaq: NSOL), by opening up the registration of such popular domains as “.com,” “.org,” and “.net” to additional companies. Although the database for the generic Top Level Domains (gTLD) is still managed (a “registry” function) by Network Solutions, Inc. (NSI), the domains may be “registered” by many different entities including www.register.com and www.aol.com. ICANN is now considering additional generic TLDs to .com, .net and .org for commercial uses. For example, ICANN is considering suggestions to add “.travel,” “.banc,” “.museum,” “.union, and “.xxx” or “.sex.”45 Various groups have suggested other gTLDs: The Free Software Foundation asked ICANN to approve “.gnu” domains dedicated to open-source projects and programming; NetNumber, an Internet telephone and communications company suggested “.tel,” and VRx Network Services may suggest the domains “.faq,” “.list,” “.prices,” and “.gallery.”46 At its July 16, 2000, meeting in Yokohama, Japan, the ICANN Board of Directors adopted a policy for the introduction of new Internet gTLDs.47 “ICANN president Ester Dyson said the group is considering adding between three and twenty new top-level domains, although she refused to refused to elaborate further.”48 After a period of public comment, these proposals will be evaluated and ICANN will select a limited number of proposals for negotiations toward agreements between ICANN and the TLD sponsors and operators. ICANN’s goal is to complete negotiations for appropriate agreements by December 31, 2000.49 In mid-August, ICANN posted the Detailed New TLD Registry Application Form, instructions for filling out the application, and a statement of criteria for the Board’s eventual decision. ICANN began accepting applications on September 5, 2000. The remainder of the schedule is as follows:

October 2, 2000 Deadline for ICANN’s receipt of completed applications (including all supporting materials and application fees) and amendments to applications.

October 5, 2000 Portions of these applications deemed appropriate for publication for purposes of public comment or otherwise will be posted on ICANN’s web site.

October 19, 2000 Close of period for public comments on proposals.

Mid-November50 2000 After approval by the Board, ICANN will announce selections for negotiations toward entry of agreements with registry sponsors and operators.

December 31, 2000 Target date for completion of negotiations.

In order to apply, applicants must not only submit an application in accordance with ICANN’s guidelines (which are available on ICANN’s Web site51) but also pay a non-refundable fee of $50,000.00. As of August 2, 2000, twenty-nine groups expressed interest in starting up new top level domains (i.e. suggesting a new gTLD and operating a registry for the suggested gTLD).52 Critics complain that the fee “is too high a barrier to entry for noncommercial groups or poor international companies to hurdle.”53 Also, there are questions about whether the selection process will be fair, i.e. those corporate and industrial applicants with connections to ICANN members will have their gTLD selected, but an individual who suggested the same gTLD and also paid a non-refundable $50,000.00 fee will not be selected; such questions about the fairness of the gTLD selection process could result in litigation against ICANN.

B. ICANN Uniform Domain Name Dispute Resolution Policy

1. Background

On October 24, 1999, ICANN adopted a uniform domain name dispute resolution policy which is binding on all accredited registrars; this policy incorporates by reference the Rules for Uniform Domain Name Dispute Resolution Policy (UDRP).54 The policy and the rules provide a method to contest the propriety of existing domain name registrations. In order to be entitled to obtain transfer of a domain name from a prior registrant, a complainant must establish that:

(1) the domain name(s) is/are identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and

(2) the domain name holder has no rights or legitimate interests with respect to the domain name(s) that is/are the subject of the complaint; and

(3) the domain name(s) has/have been registered and is/are being used in bad faith.55

The Dispute Resolution policy is popular due to its relatively low cost and the speed with which parties obtain results (within 45 days).56 By the spring of this year, seventy-four percent of the decided cases favored existing trademark holders.57 However, courts are not bound by the administrative proceedings of an ICANN panel. See Weber-Stephen Prods. v. Armitage Hardware and Bldg. Supply, 2000 U.S. Dist LEXIS 6335, 54 U.S.P.Q.2d (BNA) 1766, (N.D. Ill. 2000). This ruling is significant because of the volume of proceedings before the dispute resolution panel: as of May 9, 2000, there were 518 pending cases.58

2. Recent Decisions Under ICANN’s Uniform Domain Name Dispute Resolution Policy59 and Court Cases

a. Trademarks

i. In one of the first cases of trademark cybersquatting, President and Fellows of Harvard College v. Rhys, D. Mass., No. 99CV12489RCL, (filed Dec. 6, 1999, Judge Reginald Lindsey), Harvard sued domain name owners, and seeks to prevent Web Productions, a company which has registered sixty-five domain names relating to Harvard and Radcliffe, from using Harvard’s trademarks.60

ii. Frequently, the trademark owner is able to obtain the rights to the domain name that contains the mark.

(a) Dell Computer Corp. won the rights to nine addresses, including dellwireless.net, dellpocketpc.net, dellpalm.com, and dellpalm.net.61

(b) Chase Manhattan Corp. announced that it was acquiring the British investment bank Robert Fleming Holdings, Ltd. The same day Chase made this announcement, Entertainment Charlotte registered seven addresses with variations on the combined names, such as chasefleming.org and chase-flemings.net. An arbitrator awarded these addresses to Chase Manhattan Corp.62

(c) Yahoo! Inc. has been successful in two cybersquatting cases. In one case, a WIPO panel ruled that an individual must give up four addresses to Yahoo: yahoofree.com, yahoofree.net, yahooemail.net, and yahoochat.net.63 In another case, several companies which together had registered thirty-six domain names had to return all those names to Yahoo. See Yahoo! Inc. and GeoCities v. Data Art Corp., et al., WIPO Case No. D2000-0587.

(d) AT&T won the domain names attmexico.com and att-latinamerica.com; the WIPO arbitrator “found that ‘the letters ATT are a fundamental feature of the complainant’s marks’ and concluded that the two domain names were registered in bad faith.”64 AT&T also won transfer of the domain name “ATT2000.com” in AT&T Corp. v. Tala Alamuddin, WIPO Case No. V2000-0249, where the arbitrator noted that the acronym “ATT” was internationally recognized.65

(e) A cybersquatter must give up the domain name www.e-ikea.com because it was confusingly similar to the trademark of IKEA, the world’s largest furniture retailer, and it was registered in bad faith.66

(f) Cybersquatters frequently register more than one variation of a domain name that contains a trademark. Nevertheless, successful trademark owners obtain the rights to all those domain name variations. In Telia AB v. Ewaldsson, WIPO Case No. D2000-0599, the panel awarded 243 domain names to complainant Telia.

(g) Offering to ransom the domain name to the trademark holder is evidence of bad faith which the arbitrators consider in awarding a domain name to the trademark holder. See Christies, Inc. v. Ola Ljungberg, WIPO Case No. DNU2000-0002, where the cybersquatter offered to sell christies.nu to Christies, Inc., the auction house, for $120,000.00.

(h) The largest crackdown on cybersquatting: Three Olympic governing bodies (the International Olympic Committee, the United States Olympic Committee, and the Salt Lake Organizing Committee for the Olympic Winter Games of 2002) filed a suit in the United States District Court of Virginia seeking a court ruling to shut down over 1,800 Web sites which are allegedly profiting from official Olympic trademarks [all the sites contain the trademark names “Olympics,” “Olympic,” “Olympiad,” their derivation in Spanish or French, or their misspelling (such as “2004Olimpics.com”)].67 The United States Olympic Committee has already won the right to two domain names in a recent arbitration proceeding. See United States Olympic Comm. (USOC) v. Tri B-U-N Eco. Project, WIPO Case No. D2000-0435 (awarding the domain names usaolympiconlinestore.com and olympiconlinestore.com to the USOC).

iii. Mixed Success

Some trademark owners are not successful. This is frequently because of an inability to show bad faith on the part of the registrant. For example, Reuters won the right to five addresses (wwwreuters.com, ruters.com, reters.com, reuers.com, and reutersnews.com) registered by Global Net 2000, Inc., which “used the Reuters mark to drive visitors to its Web site by forwarding” visitors to its own site.68 However, Reuters did not win the transfer of one address, ereuters.com. The arbitrator found that, although the domain name is confusingly similar to the complainant’s (Reuters) trademark and the respondent has no rights or legitimate interests in the domain name, the arbitrator noted that ereuters.com was used for non-profit discussions regarding improvements in Asian maid services and thus was not registered in bad faith.69

iv. Unsuccessful Trademark Owners

(a) Fuji Publishing, a Web developer, won the right to use the domain name Fuji.com in creating e-commerce Web sites for wineries and cigar companies. The photographic materials company Fuji Photo Film Company of Japan and its U.S. subsidiary claimed that it should own the Fuji.com domain name. They did not succeed because they did not meet the UDRP requirement that the current holder of a disputed domain name has no legitimate claim to the address since Fuji Publishing used the domain name to sell its own services, not confuse consumers or trade off Fuji Photo Film’s name.70

(b) Augusta National, Inc., the golf country club which hosts the Master’s tournament has a trademark on “Masters” and tried to obtain the name Masters.com from Bancrost & Masters, a computer services company. Not only was Augusta National unsuccessful in its attempt to obtain the domain name, but now faces a cancellation proceeding for its federally registered “Masters” trademark.71

(c) EasyJet Airline Company lost its cybersquatting claim over the name easy-jet.com because the arbitration panel found that the registrant, who sells printer cartridge refills, lacked bad faith.72

b. Celebrities and Famous Names

i. Brad Pitt has also filed suit against the owners of “bradpitt.com,” who initially tried to sell the domain name to Pitt for as much as $50,000.00,73 and the owners of “bradpitt.net,” a commercial cite and fan club outlet which sells merchandise featuring Brad Pitt.74

ii. Frequently, the celebrity (or the celebrity’s estate) wins the right to the domain name bearing his or her name. See www.rosaparks.com,75 www. Jimihendrix.com,76 and jthrotull.com and jethro-tull.com.77 The reason is that the arbitrators treat the name of a famous or widely known person as constituting an unregistered trademark or service mark sufficient for the UDRP paragraph 4(a)(i). See, e.g., Julia Fiona Roberts v. Russell Boyd, WIPO Case No. D2000-0219.

iii. Nevertheless, the celebrity is not guaranteed to win the rights to a domain name bearing his famous name.

(a) If the complainant is world famous under a name that utilizes common words, the celebrity may not win the rights to a domain name bearing his or her name. See Gordon Sumner, p/k/a Sting v. Michael Urvan, WIPO Case No. D2000-0596 (the famous musician “Sting” did not win sting.com)

(b) Singer and actress Madonna has filed a complaint to own the domain name madonna.com. The current owner of that domain name, Dan Parisi (who owns the adult Web site whitehouse.com), is arguing that “Madonna” is a common word in the English language; however a spokesperson for Madonna said that Madonna has trademarked the word “Madonna.”78

V. Miscellaneous

A. One court has addressed the question of whether a domain name constitutes property: In Network Solutions, Inc. v. Umbro Int’l, Inc., 259 Va. 759, 529 S.E.2d 80, 2000 VA Lexis 75 (2000), there was a judgment against the domain name registrant, but the creditor was unable to have the domain name seized and sold to satisfy the judgment. The Virginia Supreme Court found that the rights inherent in the domain name contract cannot be seized under Virginia’s statutory garnishment procedure because the domain name holder has no separate intellectual property right in the domain name. The only rights in a domain name are the rights under the domain name contract, which means a creditor could file a lien against a domain, but may be unable to sell it. Thus, this case limits the rights of one who holds a domain and could be construed to limit the value of a domain name.79

B. The freedom to create links has become an issue where courts have enjoined entities from linking due to contributory infringement. See Intellectual Reserve, Inc. v. Utah Lighthouse Ministry, Inc., 75 F. Supp. 2d 1290, 53 U.S.P.Q.2d (BNA) 1425 (C.D. Utah 1999).80

C. Cybersquatting

1. “Typosquatting” – cybersquatting by misspelling a famous name or trademark.81

a. Bargain Bid v. Ubid, et al., 2000 U.S. Dist. LEXIS 3021 (E.D.N.Y. 2000) (the United States District Court, Eastern District of New York, enjoined defendants (1) from using the Bargain Bid and Barginbid marks and (2) from indicating that the defendants’ services were sponsored, affiliated, or approved by Bargain Bid, where the defendants registered the domain name “barginbid.com” to allegedly divert consumers from the Bargain Bid’s Web site by using the common misspelling of “bargain.”)82

b. Nevertheless, the Bargain Bid case did not deter an alleged cybersquatter from registering www.phillipmorris.com, which is similar to Philip Morris, Inc.’s corporate name, but spelled with an additional “l.” Currently, the Web site www.phillipmorris.com is registered to the “Phillip Morris Club” and states that it is “dedicated to linking all of the guys named Phillip Morris together” and that it is not affiliated with the Philip Morris Tobacco Company.83 However, the page contains a link to an anti-tobacco site, ButtOut.net,84 and previously, www.phillipmorris.com automatically redirected visitors to ButtOut.net. Philip Morris, Inc. is not adopting a wait-and-see attitude; in mid-June, 2000, Philip Morris filed a trademark lawsuit in the U. S. District Court of the Eastern District of Virginia.85

c. Likewise, when a domain name “wholesaler” registered many domain names consisting of the “misspelling of famous marks or personalities in the hope of diverting Internet traffic to his sites,” WIPO arbitrators ruled that he must give up his registered misspellings of the Wall Street Journal – www.wallstreetjounal.com and www.wallstreetjournel.com – to the Wall Street Journal.86

d. See also Microsoft Corp. v. Microsof.com aka Tarek Ahment, WIPO Case No. D2000-0548 (awarding microsof.com to Microsoft Corporation).

e. The typosquatting problem has caused concern for the Treasury Department’s Office of the Comptroller of the Currency, the agency that oversees the operation of U.S. financial institutions.87 This agency issued an alert to banks, advising that the banks be careful in selecting domain names and suggesting that banks may want to consider purchasing similarly spelled domain names to prevent customer confusion and to preclude bank customers from mistakenly transmitting confidential information to those other similar Web sites.

D. State Legislation

Hollywood is a land of famous people, so it is no surprise that California has enacted its own Anticybersquatting law. This legislation prohibits the registration, in bad faith,88 of domain names that are identical or confusingly similar to the real names of other people, living or deceased. The rationale behind this law is that it will provide a “higher level of protection against Internet fraud and will make it easier for consumers to navigate the Internet by reducing the number of fraudulently registered names.” In addition, the California law closes a gap in recently enacted federal law by including protections for names that are not trademarked and for the names of promising newcomers who may not meet federal “sufficiently famous” standards but whose names might be pirated. It also offers protection for the heirs of celebrities. . . . The bill passed without a dissenting vote in the Legislature.89

Several prominent trade organizations supported this bill: SAG (Screen Actors Guild), the Motion Picture Producers Association of America, and the RIAA (Recording Industry Association of America).90 However, the California law may be challenged as an unlawful expansion of federal trademark law.91

E. Remedies

1. The most common remedy a successful complainant obtains through the arbitration process is transfer of the domain name. See. e.g., Heel Quik!, Inc. v. Goldman, NAF FA92527, available at http://www.arb-forum.org/sitemap/index.html

2. In unusual cases where there is “malicious, fraudulent, deliberate, or willful” trademark infringement under Section 35(a) of the Lanham Act, litigants have opted to take a cybersquatter to court and obtain attorney fees. In E-Stamp Corp. v. Lahoti, Case No. 00-9287 (C.D. Cal. 2000), the Court noted that the cybersquatter defendant, who had registered estamps.com and slight variations thereof, attacked Plaintiff’s mark when Plaintiff’s company was particularly vulnerable and awarded the Plaintiff $305,615.20 in attorney fees.92

VI. Conclusion

Generally, trademark owners obtain domain names containing or confusingly similar to their marks in the arbitration proceedings. Since WIPO began arbitrating Internet domain cases last year, it has received more than one thousand such cases and has completed over half of them.93

In conclusion, the Anticybersquatting Act and ICANN’s Uniform Dispute Resolution Proceeding have tremendously expanded the rights of common law trademarks and registered trademarks to preclude others from usurping those rights by registering domain names with the mark or confusingly similar to the mark.  

Criteria for Assessing TLD Proposals

ICANN expects to receive many applications to sponsor or operate new top-level domains (TLDs). In this year’s application program, it is likely that only a few of these will be selected by the ICANN Board for negotiations toward registry sponsor and operator agreements. To the extent possible, as this process continues ICANN will provide additional guidance on the likely number of TLDs to be included.

The ICANN staff is responsible for gathering information about submitted applications, evaluating the applications and associated information, and making recommendations to the Board based on the applications, associated information, and evaluations. In its evaluations, the ICANN staff currently intends to consider at least the factors described below. Applicants are invited to be creative and to explain the value of their proposals in the context of these and any other relevant factors.

1. The need to maintain the Internet’s stability.

ICANN’s first priority is to preserve the stability of the Internet, including the domain-name system (DNS). Proposals should demonstrate specific and well-thought-out plans, backed by ample, firmly committed resources, to operate in a manner that preserves the Internet’s continuing stability. The introduction of the proposed TLD should not disrupt current operations, nor should it create alternate root systems, which threaten the existence of a globally unique public name space. Security and reliability of the DNS are important aspects of stability, and proposals should set forth comprehensive strategies to assure both.

ICANN will undertake a wide-ranging assessment of a proposal’s treatment of stability issues. Among the significant aspects of stability ICANN will review are:

a. The prospects for the continued and unimpaired operation of the TLD in the manner proposed by the registry operator or sponsor throughout the period for which the delegation is agreed;

b. Provisions to minimize unscheduled outages of registry or registration systems due to technical failures or malicious activity of others;

c. Provisions to ensure consistent compliance with technical requirements in operation of the TLD;

d. Effects of the new TLD on the operation and performance of the DNS in general and the root-server system in particular;

e. Measures to promote rapid correction of any technical difficulties that occur (whether or not due to the TLD’s operation), such as availability of accurate, consistent, and helpful Whois information;

f. The protection of domain-name holders from the effects of registry or registration-system failure, such as procedures for rapid restoration of services from escrowed data in the event of a system outage or failure; and

g. Provisions for orderly and reliable assignment of domain names during the initial period of the TLD’s operation.

2. The extent to which selection of the proposal would lead to an effective “proof of concept” concerning the introduction of top-level domains in the future.

Recent experience in the introduction of new TLDs is limited in some respects. The current program of establishing new TLDs is intended to allow the Internet community to evaluate possible additions and enhancements to the DNS and possible methods of implementing them. Stated differently, the current program is intended to serve as a “proof of concept” for ways in which the DNS might evolve in the longer term.

Proposals should be chosen so as to promote effective evaluation of:

the feasibility and utility of different types of new TLDs,

the effectiveness of different procedures for launching new TLDs,

different policies under which the TLDs can be administered in the longer term,

different operational models for the registry and registrar functions,

different business and economic models under which TLDs can be operated;

the market demand for different types of TLDs and DNS services; and

different institutional structures for the formulation of registration and operation policies within the TLD.

This factor will be best served by applications that clearly articulate what concept or proposition the proposal would test, how the results of that test should be evaluated, and how the results of the evaluation would assist in the long-range management of the DNS.

3. The enhancement of competition for registration services.

As noted in the White Paper, market mechanisms that support competition and consumer choice should, where possible, drive the management of the DNS. One of ICANN’s core principles is the encouragement of competition at both the registry and registrar levels. Though the market will be the ultimate arbiter of competitive merit, the limited number of new TLDs to be introduced at this time makes it appropriate to make a preliminary evaluation of competitive merit for the “proof of concept.”

A proposal’s contributions to enhancement of competition can take various forms, depending on the specifics of the proposal. Depending on the characteristics of the TLD proposed, the nature and degree of competition involved may vary. Proposals will be evaluated to determine whether they are responsive to the general goal of enhancing competition for registration services.

Some examples of competitive issues that may be considered in evaluating proposals are:

a. What prospects do the proposed TLD and registry have for effectively competing with other TLDs and registries (either pre-existing or introduced at the same time)? Are the proposed pricing and service levels likely to be competitive with other TLDs and operators having significant market shares? If effective marketing is necessary to make the TLD competitive, does the proposal adequately provide for that marketing? If the proposal is for an unrestricted TLD, are any features proposed to maximize the prospect that the TLD will be attractive to consumers as an alternative to .com?

b. Is the proposal particularly attractive to a significant sub-market in which it can compete effectively? Are distinctive services being proposed that will meet the needs of those not being served adequately by existing services?

c. Is there any significant competitive concern that the proposed TLD is likely to lead to lock-in of domain-name holders, so that inter-TLD competition is constrained? To the extent there is a concern about constrained competition, what measures are proposed or available to ensure competitive operation of the TLD (periodic rebidding of registry, etc.)?

d. What effect would the proposal have on registrar-level competition? Does the proposal restrict the ability of accredited registrars to offer registration services within the TLD on competitive terms? What mechanism is proposed for selecting registrars?

e. If accredited registrars are not permitted to offer registration services within the TLD on a competitive basis, are there other, effective mechanisms for providing competitive choices to domain-name holders seeking to register within the TLD?

f. Would the proposal advance competitive frontiers by introducing an innovative use of the DNS?

g. Would restrictions proposed for a restricted TLD impair (either in principle or in implementation) competition among potential registrants?

4. The enhancement of the utility of the DNS.

One motivation often cited for introducing new TLDs is that doing so might increase the utility of the DNS. Under this view, the appropriateness of adding new TLDs should be evaluated based on whether addition of the new TLDs: would sensibly add to the existing DNS hierarchy and would not create or add to confusion of Internet users in locating the Internet resources they seek.

At least the following considerations will be considered in this regard:

a. If the TLD is intended for a particular use or purpose, does the TLD label suggest that use? Is this true for a large portion of Internet users globally (i.e. in different languages)?

 b. Is the proposed TLD semantically “far” from existing TLDs, so that confusion is avoided? (For example, TLD labels suggesting similar meanings might be more easily confused.) Is it phonetically distinct from existing TLDs? Meanings and pronunciations in different languages may be relevant to these inquiries.

c. Does the proposed TLD avoid names reserved by RFCs (or documents that are nearly RFCs), notably “.local” (from the HTTP State Management draft) and those names listed in RFC 2606.

d. In the case of a restricted TLD, is the restriction one that will assist users in remembering or locating domain names within the TLD? (E.g., users might conclude that “ford.car” is associated with the automobile company, not the modeling agency.)

5. The extent to which the proposal would meet previously unmet types of needs.

The DNS should meet a diversity of needs. Close examination will be given to whether submitted proposals exhibit a well-conceived plan, backed by sufficient resources, to meet presently unmet needs of the Internet community.

6. The extent to which the proposal would enhance the diversity of the DNS and of registration services generally.

One goal of introducing new TLDs should be to enhance the diversity of the DNS and the manner in which registration services are provided. In examining submitted proposals, consideration will be given to the diversity the proposal would add to the DNS. Among the diversity of proposals sought, ICANN hopes to receive proposals for fully open top level domains, restricted and chartered domains with limited scope, noncommercial domains, and personal domains. Diversity in business models and of geographic locations are also advantageous. (Note that this criterion must be judged based on the whole group of selected proposals, rather than any single proposal.)

7. The evaluation of delegation of policy-formulation functions for special-purpose TLDs to appropriate organizations.

As noted in the ICANN-staff-prepared document entitled “ICANN Yokohama Meeting Topic: Introduction of New Top-Level Domains,” the DNS is a hierarchical system that facilitates delegation of policy-formulation authority for particular TLDs. In the context of unsponsored TLDs, this can appropriately be accomplished for many operational matters by giving the registry operator flexibility in the registry contract. For restricted TLDs, some have suggested a “sponsorship” model, in which policy-formulation responsibility for the TLD would be delegated to a sponsoring organization that allows participation of the affected segments of the relevant communities. Proposals will be analyzed to determine whether they offer the opportunity for meaningful, real-world evaluation of various structures for appropriate delegation of policy-formulation responsibilities, as well as evaluation of various allocations of policy-formulation responsibilities between ICANN and sponsoring organizations.

8. Appropriate protections of rights of others in connection with the operation of the TLD.

In introducing new TLDs, care should be taken to ensure that the rights of third parties are appropriately protected. Examples of matters to be examined in this regard include:

a. Does the proposal have a well-thought-out plan for allocation of names during the start-up phase of the TLD in a way that protects the legitimate interests of significant stakeholders, including existing domain-name holders, businesses with legally protected names, and others with which conflict is likely?

b. Does the proposal provide for a reasonably accessible and efficient mechanism for resolving domain-name disputes?

c. Has the proponent considered intellectual property interests or otherwise designed protections for third-party interests?

d. Does the proposal make adequate provision for Whois service that strikes an appropriate balance between providing information to the public regarding domain-name registrations in a convenient manner and offering mechanisms to preserve personal privacy?

e. Does the proposal incorporate policies that are likely to discourage abusive registration practices?

9. The completeness of the proposals submitted and the extent to which they demonstrate realistic business, financial, technical, and operational plans and sound analysis of market needs.

The ICANN staff intends to place significant emphasis on the completeness of the proposals and the extent to which they demonstrate that the applicant has a thorough understanding of what is involved, has carefully thought through all relevant issues, has realistically assessed the business, financial, technical, operational, and marketing requirements for implementing the proposal, has procured firm commitments for all necessary resources, and has formulated sound business and technical plans for executing the proposal. Applicants are strongly encouraged to retain well-qualified professional assistance (e.g., technical, engineering, financial, legal, marketing, and management professionals, as appropriate) in formulating their proposals. Proposals that are presented in a clear, substantive, detailed, and specific manner will be preferred.

Comments concerning the layout, construction and functionality of this site should be sent to webmaster@icann.org.

(c) 2000 The Internet Corporation for Assigned Names and Numbers

All rights reserved.

 TLD Application Process FAQs

We add/revise material on this page frequently. If you have visited here before, please reload/refresh this page. (Please note that in some cases the questions in the following FAQs have been edited to generalize them or otherwise to provide information of greater general interest.)

FAQ #1: What is the process for obtaining information about how to apply to sponsor or operate a new TLD?

ICANN will make various information for applicants available on its web site. The information can be accessed through the web page at <http://www.icann.org/tlds/tld-application-process.htm>. This information will include various explanatory materials as well as application forms.

If you have a question before 3 October 2000 about the TLD application process that, after carefully reviewing the posted materials, you feel has not yet been answered, you may submit that question by e-mail to tld-applications@icann.org. To help provide all applicants with equitable access to information about the process as they prepare their applications, it is ICANN’s practice to respond to questions about applications during the application period only when they are submitted in writing. Please do not attempt to get additional information by calling or visiting our offices.

We will periodically review the questions submitted and, if a response is appropriate, we will post the question (or an edited version of it, if we feel that would be more informative) along with our responses on this web page. Please watch this web page to see any response to your question. We will not be replying separately to e-mail inquiries.

We may also create and publish other FAQs on this page as we become aware of points that should be clarified.

Please note that any question that you submit to tld-applications@icann.org is subject to being published verbatim on this web page. If you do not wish to publish an idea you have to the world, you should not include it in your question.

IMPORTANT NOTE: Those seeking information about the possibility of registering domain names within an existing or to-be-created TLD should direct their questions to icann@icann.org. Questions of this character should not be sent to the tld-applications mailbox.

FAQ #2: My TLD concept is complicated, and I feel I need to meet with ICANN to explain it. How do I do that?

After the close of the application period on 2 October 2000, ICANN staff will be evaluating all of the applications received. This process will involve not only reviewing what has been submitted, but also consulting with technical, financial, business, and legal experts and gathering additional information that may be pertinent to the application.

As needed, after the application period is concluded the ICANN staff may gather additional information by sending applicants e-mails asking for the information, by conducting telephone or in-person interviews with applicants, by attending (possibly with ICANN-retained experts) presentations by applicants or their experts, or by other means. These inquiries will be initiated by the ICANN staff; if you feel a presentation to ICANN is necessary to properly present your proposal you should suggest that in your written application.

FAQ #3:  (A) I represent a fairly large ISP & newly forming open source registrars’ group that is also interested in possibly creating a new TLD. How do I know what TLD is being spoken for? The US$ 50,000 application fee is not a problem, but I don’t want to waste it on a TLD that already has been dealt with or is being processed.

(B) Recently I’m drawing an Chinese DNS standard and require information about DNS, especially TLDs. As I know, ICANN issued new TLDs recently during the meeting in Yokohama, and I want to know what are these new TLDs.

In Yokohama, the ICANN Board adopted a policy that will allow the introduction of new TLDs, which will probably become operational next year. However, no particular TLDs were approved in Yokohama. The TLDs that are presently in effect are described in the “Present Structure of the Domain-Name System” section of the “Introduction of New Top-Level Domains” document published in advance of the Yokohama meeting.

FAQ #4: Will the date I submit my application matter if multiple candidates apply for the same name(s)? Do applicants who submit their applications earlier get priority with everything else equal?

You must submit your complete application to ICANN by the 2 October 2000 deadline. If you do so, the date on which you submit your application will not affect the selection process. In other words, the date you apply makes no difference (as long as you get your application in on time).

FAQ #5: Is it correct to assume that new TLDs to be considered by ICANN may utilize non-ASCII characters in both the name of the TLD and in name components (“labels”) hierarchically below it?

No. Domain names are used as identifiers in a variety of protocols and applications that conform to them. These protocols expect the identifiers they use to conform to a very narrow definition, which has been established in the Internet for over 25 years. Use of names that do not conform to the narrowest of the rules and conventions is known to cause operability and interoperability problems. The format is described in several places, most importantly section 3 of RFC 1034 and section 2.1 of RFC 1123 (both full Internet Standards).

Specifically, applications expect domain names that are composed only of the letters A to Z (interpreted in a case-independent fashion), digits, hyphens, and the period, all coded according to the rules of the “ASCII” character set (the “basic version” character coding specified in ISO 646). The period is used only to separate name components (called “labels” in the DNS). Labels may not start or end with a hyphen or be more than 63 characters in length; top-level domain names (i.e. the rightmost label in a name) may not start with a digit.

At this time, ICANN will only establish top-level domains having names that comply with the above format. Registries will be expected similarly to follow that format for the names they register.

The Internationalized Domain Name (IDN) Working Group of the Internet Engineering Task Force (IETF) is charged with specifying the requirements for internationalized access to domain names and a standards track protocol and encodings, based on those requirements, which will adequately respond to applications restrictions. When IDN’s work is complete, the above name-formation requirements might be modified.

See FAQ #9 and FAQ #36 for related information.

FAQ #6: Will applications submitted after 2 October 2000 (around December or early next year) be considered?

The current activity (in calling for proposals to sponsor or operate new TLDs) is part of a “proof of concept” program in which various ideas for new TLDs will be tested in actual practice. The plan is to introduce a limited number of new TLDs in a measured and responsible manner and then to evaluate how the introduction fared.

To be included in this proof-of-concept program, applications must be received by 2 October 2000. Based on evaluation of how things proceed, next steps will be decided, and later applications might then be accepted.

FAQ #7: How can I arrange for ICANN to send me a hard copy of the application form?

You can’t. Applications will consist primarily of comprehensive technical, business, and policy proposals prepared by or for the applicant. There will also be various forms to be submitted, which are scheduled to be available on the ICANN web site on 15 August 2000. Once these are available, you should print them, fill them out, and submit them as part of your overall application.

FAQ #8: In some jurisdictions, it is a long process to authorize a not-for-profit application for which the temporary applicant is an ordinary corporation with the intent to convert it to a not-for-profit corp? Such an authorization may be conditional upon the conversion prior to fully implementing the registry.

The appropriate course in this situation depends on whether the to-be-formed not-for-profit corporation is proposed to be a sponsoring organization (the usual case), the registry operator, or both.

A proposed sponsoring organization need not actually be formed at the time that the application is made. The application for a sponsored TLD can be made by those proposing to form the sponsoring organization. Of course, formation must be complete before the organization enters a TLD sponsorship agreement with ICANN. Ordinarily, ICANN’s decision to delegate to a sponsoring organization will be made based partly on the characteristics of the proposed organization, and that organization should be the one that will serve as the sponsoring organization throughout the period of the requested delegation.

In contrast, the registry operator’s proposal should be submitted by an existing organization. As with sponsoring organizations, ICANN’s decision to delegate to a registry operator will be made based partly on the characteristics of the operator. The proposed operator should be the one that is proposed for the entire period of the requested delegation.

See FAQ #12 for related information.

FAQ #9: If a restricted TLD were to be the subject of an application, would ICANN accept a TLD name in ASCII letters which are conversions from another symbolic system to Roman letters?

A TLD name must conform to format requirements summarized in FAQ #5. Provided it does, it can be a transliteration having meaning in another symbolic system. For example, .san (transliterated from Japanese) would acceptable as the name of a TLD for personal-use domain names.

FAQ #10: Will there at any time be the opportunity to secure an extended window to lodge an application or the possibility of securing some sort of option over the right to lodge an application? The very short time frame within which to lodge applications is short.

The current application process is part of a “proof of concept” program that is intended to involve introduction of only a limited number of new TLDs. In recognition of the limited recent experience in introducing new TLDs, the program is meant to allow the Internet community to evaluate possible additions and enhancements to the DNS and possible methods of implementing them. After these initial introductions, decisions can be made about evolution of the DNS (including new TLDs) based on the experience gained. While it would not be appropriate to prejudge those decisions, they may involve seeking additional applications in the future.

FAQ #11: One might think that all applicants must be not-for-profit organizations. Is this understanding correct?

No. Depending on the type of TLD being proposed (sponsored or unsponsored), the applicant will be either a sponsoring organization or a registry operator. For discussions of the role of each, see the Sponsored and Unsponsored TLDs section of the New TLD Application Process Overview document and criteria 7 in the Criteria for Assessing TLD Proposals document. Each organization should have characteristics (not-for-profit, for-profit, etc.) appropriate to its role within the overall context of the proposal.

FAQ #12: Can multiple organizations make an application to sponsor a TLD?

Yes, in the situation where the sponsoring organization is not yet formed. See, for example, item A1 on the Sponsored TLD Application Transmittal Form and Instruction I9.2. In all other situations, there should be only a single applicant. For related information, see FAQ #8.

FAQ #13: I have the question about paying the US$50,000 fee. If the application is not granted, is ICANN giving the US$50,000 back?

No. The fee is only an application fee, in exchange for which ICANN will review your application. ICANN will keep your fee even if it does not grant your application. There is only one situation in which your application fee might be returned. If you claim your application contains confidential information and ICANN disagrees, ICANN will delete the information before reviewing your application on the merits. In this situation, you will be offered the opportunity to withdraw the application and obtain a refund of the US$50,000 application fee. See section I of the Statement of Requested Confidential Treatment of Materials Submitted for details.

FAQ #14: If the application is granted by ICANN, is ICANN keeping the fee?

Yes. Applications will be granted only after review and evaluation by ICANN. The fee is designed to defray ICANN’s costs associated with processing and evaluating the applications, and follow-up.

Please note that ICANN recovers its costs of operation from domain-name and IP-address registries and registrars. Those preparing Registry Operator Proposals should factor their share (if the application is accepted) of ICANN’s cost-recovery needs into their business model.

FAQ #15: Why is the application fee so high? Aren’t you going to prevent non-profit TLD registry proposals by requiring such a steep application fee?

As a small non-profit organization, ICANN must conduct its activities so they are essentially self-funding, on the principle of cost-recovery. For example, the accreditation process for .com, .net, and .org registrars is funded through application and accreditation fees paid by those registrars. Likewise, the new-TLD-application process must be self-funding. This process will include very intensive review and analysis of applications on many levels (including technical, financial, legal, etc.). The application fee was set at a level intended to cover all of ICANN’s costs related to the process. It would not be justifiable to require existing registries and registrars to subsidize the process.

In establishing the fee, ICANN’s Board was concerned that the application fee might discourage some applications for special-purpose restricted TLDs. However, a multi-tiered fee structure would mean that some applicants would subsidize the application-review costs of others. This would be particularly unfair because of difficulties in distinguishing between for-profit and non-profit proposals in the global context. Accordingly, a single, cost-recovery-based application fee has been adopted for this year’s new-TLD-application process.

FAQ #16: ICANN states clearly its intention to create competition among gTLD registries as it did with registrars. Will ICANN grant an application for a new registry for an existing gTLD like .com, .net, or .org?

No. The current program involves the evaluation of applications to sponsor or operate “new TLDs,” not existing ones. As stated in the New TLD Application Process Overview document, “The adopted policy calls for submission of proposals to sponsor or operate new TLDs by interested persons and organizations.” There is no intent to upset arrangements for existing TLDs through this program.

FAQ #17: My group is dissatisfied with the operation of the two-letter ccTLD that has been assigned to our country. We would like to apply to operate a registry for that ccTLD. Should we submit an application under the New TLD program?

No. The New TLD Application Process involves establishing new TLDs, not changing the delegation of existing ones. Applications in the New TLD program should not seek TLD strings that match alpha-2 codes on the ISO 3166-1 list. See FAQ #21 and FAQ #24 for related information.

FAQ #18: If we go through all the effort to apply for a top level domain, who owns it? What could potentially happen to change ownership?

Top-level domains are established for the benefit of the Internet community. Their operation is delegated to particular organizations based on a showing that doing so is in the best interests of the Internet community. An operator does not “own” a top-level domain. As noted in RFC 1591 (written by Jon Postel in 1994 and entitled “Domain Name System Structure and Delegation”): “Concerns about ‘rights’ and ‘ownership’ of domains are inappropriate. It is appropriate to be concerned about ‘responsibilities’ and ‘service’ to the community.”

It is anticipated that TLD registry agreements will provide that, if a registry operator fails to meet its service obligations, the agreement may be terminated. In their proposals, sponsoring organizations and registry operators should state the term they are suggesting and explain why they believe that term would best serve the interest of the Internet community. See, for example, item D13.2.10 of the Registry Operator’s Proposal.

FAQ #19: Is the non-refundable US$ 50,000 application fee per TLD or per idea? In other words, if I apply for multiple TLD strings is that one or many applications?

It is US $50,000 per application. Section VIII of the New TLD Application Instructions discusses the circumstances in which a single application can propose multiple TLD strings.

FAQ #20: I am planning to submit an application to ICANN for a new TLD. I would like to submit my application in writing. What address should I send my application to?

This information is provided in item I22 of the New TLD Application Instructions. Persons considering submitting an application are urged to carefully review that document as well as the instructions stated in the applications. Failure to follow all of the instructions can lead to denial of your application.

FAQ #21: Will an application which accidentally proposes a TLD that is an alpha-3 code on the ISO-3166-1 list fail?

As stated in FAQ #17, applications in the New TLD program should not seek TLD strings that match alpha-2 codes on the ISO 3166-1 list. There is no similar, automatic disqualification on alpha-3 codes on the ISO 3166-1 list.

See FAQ #24 for a follow-up question.

FAQ #22: What is the procedure in the event of duplicate submission of a domain name by different parties? Which party would get preference? Would the fee be non-refundable for the party that is not selected?

Applications to sponsor or operate a TLD will be evaluated according to the Criteria for Assessing TLD Proposals, under which all aspects of the proposal (operational, financial, technical, etc.) will be considered. The particular TLD string requested is only one of many factors in the evaluation. Clearly, the same TLD cannot be established for both proposals; differences between the applications would be considered according to the criteria. The fee paid by a non-selected applicant would not be refundable.

FAQ #23: Will two (or more) parties that apply for a TLD in related fields or that propose identical plans be asked to negotiate to present a joint proposal?

Although it is possible that negotiations toward a joint proposal would be urged depending on the circumstances, applicants should not assume that ICANN will request or require such negotiations. Applicants should consider discussing their proposals with other interested members of the community before submitting them.

FAQ #24: FAQ #21 states that there is no “automatic disqualification” of applications proposing TLD labels that are alpha-3 codes on ISO 3166-1 list. Is this the correct even if a ccTLD has been established for the corresponding alpha-2 code on the ISO 3166-1 list?

Yes, it is correct that there is no automatic disqualification. Please take note, however, of consideration 4(b) in the Criteria for Assessing TLD Proposals, which states:

b. Is the proposed TLD semantically “far” from existing TLDs, so that confusion is avoided? (For example, TLD labels suggesting similar meanings might be more easily confused.) Is it phonetically distinct from existing TLDs?

Meanings and pronunciations in different languages may be relevant to these inquiries. In this context, “existing TLDs” includes ccTLDs that have been established.

FAQ #25: We are an established not-for-profit institute that wishes to sponsor a chartered TLD. However, we feel that the eventual formation of an international sponsoring organization would be best for this chartered TLD. We would therefore like to propose our institute as the sponsoring organization pro tem, with a well-defined schedule for the establishment of the international sponsoring organization (as negotiated with ICANN). Would such a proposal be acceptable to ICANN?

Assuming that a proposal qualifies in other respects, the fact that the proposed sponsoring organization has not yet been formed should not disqualify the proposal. As noted in section 1(c)(i) of the New TLD Application Process Overview, “Where the proposed sponsoring organization has not yet been formed, the submission may be made by the organizers of that organization.” Thus, it would be appropriate to have a proposal under which your not-for-profit institute would propose to establish the international sponsoring organization. If you wish your proposal to be evaluated based on the appropriateness of the to-be-formed international organization (rather than the institute) as sponsor, we recommend that your proposal include plans to form the organization before completion of any contract negotiations with ICANN. The proposed organization could be affiliated initially with your institute, with a spin-off scheduled for a later time.

In submitting your application, you should check the box in item A1 of the Sponsored TLD Application Transmittal Form next to “Organization(s) or person(s) proposing to form the sponsoring organization (check this item only if the sponsoring organization has not yet been formed).” Section I of the Sponsoring Organization’s Proposal should be completed to give the information for the sponsoring organization that is proposed (i.e. the one to be formed).

FAQ #26: Will existing ICANN-accredited registrars for .com, .net, and .org be able to act as registrars in the new TLDs?

The type of channels used for registrations in a TLD is only one of many factors that will be considered in determining whether to select a proposal for negotiations toward possible establishment of a TLD. For a discussion of some relevant factors that may pertain to the considerations raised by your question, see Criteria for Assessing TLD Proposals, and particularly “the enhancement of competition for registration services” (factor 3).

FAQ #27: Can the floppy diskette requirement be expanded to allow softcopy submission on CD?

Yes, it can. Thanks for the great suggestion! We have already changed the documents to make this change.

FAQ #28: Can you provide any estimate on the timing for the “proof of concept” phase for new TLDs, and when the next opportunity to propose TLDs after this initial phase will be?

There is not yet any date that has been scheduled for a “next round,” and at present we have no predictions as to the schedule. In the current round of applications, applicants are requested to describe the value of their proposals as proofs of concept. Item E30 of the Description of TLD Policies requests suggestions for how the results of the introduction being proposed should be evaluated. Once a decision is made on the evaluation procedure to be used for TLDs introduced in the current round, the timing of future steps should become clearer.

FAQ #29: We would like to provide an Executive Summary of our TLD proposal (perhaps 1 to 3 pages in length) that describes the motivation and overall goals of the TLD. Where should such a summary be placed in the application? Perhaps as a cover letter?

We suggest that you attach it to your Description of TLD Policies. Before item E1 on your description, you should type in a statement such as “An Executive Summary of this proposal is attached.”

Materials that you wish ICANN to consider in support of your application should be included in the body of your application materials (i.e. your transmittal form, the Sponsoring Organization’s Proposal, the Registry Operator’s Proposal, the Description of TLD Policies, the fitness disclosures, or the Statement of Requested Confidential Treatment) or as a referenced attachment, not in an unreferenced, separate cover letter.

FAQ #30: Item (c) under factor 8 of the Criteria for Assessing TLD Proposals states that when evaluating proposals ICANN will examine: “c. Has the proponent considered intellectual property interests or otherwise designed protections for third-party interests?” What types of intellectual-property protections should be included?

Applicants should propose measures they believe are appropriate to protect intellectual property and other third-party interests. The types of protections that are appropriate will depend, to some extent, on the nature of the TLD and other circumstances. Applicants should anticipate that one of the topics of public comments on their proposals will be the appropriateness of the protections they propose. In preparing their proposals, applicants may wish to consult the materials prepared by the ICANN DNSO Intellectual Property Constituency (IPC) and posted on the IPC website. These are the views of the IPC only.

FAQ #31: What TLDs are already established?

Presently, there are seven traditional “generic” TLDs (.com, .edu, .gov, .int, .mil, .net, and .org), nearly 250 two-character “country-code” TLDs, and one infrastructure TLD (.arpa). For a more detailed description of the present TLDs, see the detailed topic paper on TLDs prepared in advance of the ICANN Yokohama meeting.

FAQ #32: I’m investigating the possibility of two companies (parent companies) with complimentary capabilities forming a jointly held company (joint venture) to operate a new non-sponsored TLD registry. The joint venture would not have any operational experience and history. Am I correct in assuming that the Registry Operator’s Proposal should describe the data and history for the two parent companies? Also, will ICANN consider the application if the joint venture is not yet established when the application is sent?

A Registry Operator’s Proposal must be submitted by a proposed registry operator that is in existence (i.e. has already been formed) at the time the proposal is signed and submitted. Note that the proposed registry operator should be an organization, such as a corporation, having the ability to enter legally binding contracts.

The Registry Operator’s Proposal should describe the capabilities of the entity proposed actually to serve as registry operator. In the circumstances you describe, that could be done by describing the data and history of the parent companies and by providing documentation that the parent companies are firmly committed to transferring their relevant operational units to the newly formed entity.

FAQ #33: How do I pay the application fee?

When they were first posted, the instructions required that the non-refundable application fee be paid by check. That is still the payment method we prefer that you use. However, for the convenience of those that may have difficulty in obtaining a check drawn on a United States bank, we have decided to permit payment by wire transfer. In either case, because your application will only be considered once we are satisfied you have fully paid the application fee, it is vital that you follow the payment instructions exactly:

If you choose to pay by check, with your application you must send a check, drawn on a United States bank and payable to the Internet Corporation for Assigned Names and Numbers (ICANN), in the amount of 50,000 United States dollars. If you choose to pay by wire transfer, you must arrange for the wire transfer to be sent to ICANN at the following account:

Internet Corporation for Assigned Names and Numbers

Account number 09141-04900

Routing indicator 121000358

Bank of America Branch 0914

4754 Admiralty Way

Marina del Rey, CA 90292 USA

Telephone +1/310/247-2080

We must receive wire transfers at least five business days before we receive your application and you must include a wire transfer receipt or other document identifying the wire transfer with your application.

FAQ #34: Where can I obtain a list of the parties that previously submitted a letter of interest and brief proposal to operate/sponsor a new gTLD?

For a list of expressions of interest received in the period leading up to the ICANN meeting in Yokohama, click here.

FAQ #35: Can I propose to act as both the registry operator also a registrar?

Applicants should describe the marketing channels they are proposing. See item D13.2.4 of the Registry Operator’s Proposal. A proposal to act as both registry operator and registrar is not forbidden, though that feature may affect how your proposal is evaluated. In formulating recommendations for the ICANN Board, the ICANN staff currently intends to consider at least the factors stated in the Criteria for Assessing TLD Proposals, including factor 3: “The enhancement of competition for registration services.”

FAQ #36: In your response to FAQ #5, regarding the use of non-ASCII characters in a TLD string, you stated, “top-level domain names… may not start with a digit.” Having conducted research into this specific area, we have proven (just by the adoption of simple policies that can be applied at the registry level) that it is possible to operate a TLD with a digit as the first character while maintaining the stable operation of the DNS, and we believe that a proposal of this sort “might increase the utility of the DNS.” Can the no-beginning-digit statement of FAQ #5 be relaxed?

Not at this time. It is important to Internet stability that DNS names conform to the relatively narrow format rules and conventions stated in the RFCs because, among other things, application developers have relied on those format rules and conventions in designing, implementing, and testing software that handles DNS names. Although the statements in RFC 1034 and section 2.1 of RFC 1123 (cited in the response to FAQ #5) might, standing alone, be subject to differing interpretations, subsequent RFCs have interpreted those RFCs to prohibit TLD labels starting with digits. See RFC 2396, pages 13-14 (August 1998); RFC 1738, page 6 (December 1994). At least one of these RFCs has been available to software developers for over five years.

If the no-first-digit requirement for TLD labels is to be relaxed, it should be done through the IETF, which developed the documents articulating the requirement.

Comments concerning the layout, construction and functionality of this site should be sent to webmaster@icann.org.

(c) 2000 The Internet Corporation for Assigned Names and Numbers.

All rights reserved.

________________________

1 The term “trademarks” refers to trademarks and service marks.

2 Disney’s Settlement Ends Suit Asserting Trademark Violation, Wall Street Journal Interactive Edition, May 26, 2000. Disney agreed to pay $21.5 million to settle this lawsuit.

3 Disney’s Settlement Ends Suit Asserting Trademark Violation, Wall Street Journal Interactive Edition, May 26, 2000. Disney agreed to pay $21.5 million to settle this lawsuit. /

4 See Steven Bonisteel, Mattel Whips “Barbie” Porn-Site Operator In Court, Newsbytes, July 19, 2000.

5 Compare I.P. Lund Trading A.P.S. v. Kohler Co., 163 F.3d 27, 49 U.S.P.Q.2d (BNA) 1225 (1st Cir. 1998) (specifically rejecting the “lessening of demand for the product” test applied by the Fourth Circuit in the Ringling Brothers case).

6 Note that the Hatfield case, which held that there was no liability, occurred prior to the enactment of the Anticybersquatting Act.

7 WIPO is an approved domain name dispute arbitration organization. See also Reuters, WIPO Launches “Squat Fight,” Wired News, July 10, 2000; Adam Creed, Australian Gov’t Asks WIPO To Rid World of Cybersquatters, Newsbytes, June 22, 2000.

8 See Excelentisimo Ayuntamiento de Barcelona v. Barceloa.com Inc., WIPO Case No. D2000-0505.

9 Louise Ferguson, Geographic Domains on Shaky Ground, The Industry Standard, Aug. 11, 2000.

10 Id.

11 WIPO Case No. D2000-0617.

12 Id. Another interesting aspect of this case is that the respondent did not file a response to the complaint. Nevertheless, the WIPO arbitrator viewed the Web site at issue and found bad faith lacking, as well as the Web site owner’s potential for legitimate interest.

13 Copyright Not Infringed by Hyperlink to Interior Pages, The Internet Newsletter, Mar. 2000.

14 Brenda Sandburg, Copyright Not Violated by Hypertext Link, The Recorder, Mar. 31, 2000.

15 Oscar S. Cisneros, Legal Tips for Your “Sucks” Site, Wired News, Aug. 14, 2000.

16 Id.

17 Criag Bicknell, Idealab F*cks With F*ckedCompany, Wired News, Sept. 27, 2000.

18 See www.comupix.com/ballysucks/index.htm.

19 Steven Bonisteel, Wal-Mark Sucks Names Away From Domain Claim Jumper, Newsbytes, Aug 1, 2000.

20 John Partridge, “Cybergripers” Lose Rights, The Globe and Mail, Aug. 19, 2000. Now Wal-Mart has itself registered over two hundred anti-Wal-Mart names in the hopes of preventing critical and parody sites. See also, David Streitfeld, Making Bad Names For Themselves, Washington Post, Sept. 8, 2000.

21 Federal Court Orders Peta.org Name Delivered to Animal Rights Group, IP L. Weekly, July 25, 2000. See also Sonja Barisic, Owner of PETA Parody Web Site Ordered to Relinquish Address, Associated Press, July 21, 2000.

22 Steven Bonisteel, Guinness “Sucks” Domain Disputes Come to a Head, Newsbytes, Aug 28, 2000.

23 Gwendolyn Mariano and Evan Hansen, Parody Site Sucked Into Cybersquatting Squabbles, CNETNews.com, Aug. 24, 2000.

24 David Streitfeld, Making Bad Names For Themselves, Washington Post, Sept. 8, 2000.

25 Oscar S. Cisneros, Mattel: Don’t Play With Barbie, Wired News, July 27, 2000.

26 Gwendolyn Mariano and Evan Hansen, Parody Site Sucked Into Cybersquatting Squabbles, CNETNews.com, Aug. 24, 2000.

27 David Streitfeld, Making Bad Names For Themselves, Washington Post, Sept. 8, 2000.

28 Id.

29 As found by the Court, Playboy Enterprises (PEI):

owns federally registered trademarks for the terms Playboy, Playmate, Playmate of the Month, and Playmate of the Year. The term Playmate of the Year is sometimes abbreviated “PMOY.” PEI does not have a federally registered trademark in the abbreviation “PMOY,” although PEI argues that “PMOY” is worthy of trademark protection because it is a well-known abbreviation for the trademark Playmate of the Year.

 Playboy Enters., 7 F.Supp.2d at 1100.

30 A “metatag” is a hidden word or label in a Web page which often includes keywords to draw the attention of Internet search engines to that Web page. See Kaplan, Carl S., Former Playboy Model Wins Rights to Use Keywords, Cyber Law Journal, Dec. 17, 1999.

31 The Court also found that, with respect to the metatags, there is no trademark infringement where defendant uses Playboy’s trademarks in good faith to index the content of her Web site.

32 See Former Playboy Model Wins Right to Use Keywords, Cyber Law Journal, Dec. 17, 1999, (wysiwyg://66//http://www.nytimes.com/library/tech/99/12/cyber/cyberlaw/17law.html); Playboy Enters., Inc. v. Welles, Case No. 98-CV-0413-K, Judge Judith Keep (S.D. Cal. Dec. 1, 1999) (http://www.terriwelles.com/order_01.htm).

33 Id.

34 See Slind-Flor, Victoria, False Signs on the I-Highway, Nat’l L.J., Jan 5, 2000.

35 See Kaplan, Carl S., Judges Pick David Over Goliath in Domain Name Suits, Cyber Law Journal, Sept. 17, 1999.

36 See also Groner, Jonathan, Court Rejects Trademark for “Best Beer in America,” Legal Times, Dec. 13, 1999.

37 Kettmann, Steve, E-Riots Threaten Etoys.com, Wired News, Dec. 15, 1999; Mirapaul, Matthew, Etoys Lawsuit is No Fun for Artist Group, New York Times, Dec. 9, 1999. See also Priority of Parties’ Use of Marks on Web Pages Too Close to Call, E-Commerce Law Weekly, Dec. 14, 1999, pp. 219-220. The parties ultimately settled Etoys.com v. etoy.com.

38 18 U.S.C. § 706 provides for criminal for fraudulent or unauthorized use or display of the Red Cross of the American National Red Cross.

39 36 U.S.C. § 220506 provides for civil penalties for unauthorized use of the names, marks or symbols of United States Olympic Committee, the International Olympic Committee, the International Paralympic Committee, the Pan-American Sports Organization.

40 These factors are as follows:

(I) the trademark or other intellectual property rights of the person, if any, in the domain name;
(II) the extent to which the domain name consists of the legal name of the person or a name that is otherwise commonly used to identify that person;
(III) the person’s prior use, if any, of the domain name in connection with the bona fide offering of any goods or services;
(IV) the person’s bona fide noncommercial or fair use of the mark in a site accessible under the domain name;
(V) the person’s intent to divert consumers from the mark owner’s online location to a site accessible under the domain name that could harm the goodwill represented by the mark, either for commercial gain or with the intent to tarnish or disparage the mark, by creating a likelihood of confusion as to the source, sponsorship, affiliation, or endorsement of the site;
(VI) the person’s offer to transfer, sell, or otherwise assign the domain name to the mark owner or any third party for financial gain without having used, or having an intent to use, the domain name in the bona fide offering of any goods or services, or the person’s prior conduct indicating a pattern of such conduct;
(VII) the person’s provision of material and misleading false contact information when applying for the registration of the domain name, the person’s intentional failure to maintain accurate contact information, or the person’s prior conduct indicating a pattern of such conduct;
(VIII) the person’s registration or acquisition of multiple domain names which the person knows are identical or confusingly similar to marks of others that are distinctive at the time of registration of such domain names, or dilutive of famous marks of others that are famous at the time of registration of such domain names, without regard to the goods or services of the parties; and
(IX) the extent to which the mark incorporated in the person’s domain name registration is or is not distinctive and famous within the meaning of subsection (c)(1) of section 43.

See also Jeffrey K. Riffer, Anticybersquatting Consumer Protection Act Targets “Bad Faith” Domain Name Holders, Nat’l L.J., Jan 7, 2000.

41 See Jeff Riffer, New Federal Law on Cybersquatting Signed, The Internet Newsletter, Dec. 1999, pp. 1-2.

42 The Act also authorizes an in rem action against the domain name; the remedies in such an in rem action are limited to the forfeiture or cancellation of the domain name, or transfer of the domain name to the mark’s owner. The in rem action is available if the holder of the domain name is not subject to personal jurisdiction in a federal civil action, or cannot be found. The venue for the in rem action is the district in which the domain name registrar, domain name registry, or other authority that registered or assigned the domain name is located. See Porsche Cars North America, Inc. v. porsch.com, 51 F. Supp. 2d 707 (E. D. Va. 1999). See also Caesars World, Inc. v. Caesars-Palace.com, 2000 U.S. Dist. LEXIS 2671, 54 U.S.P.Q.2d (BNA) 1121 (E.D. Va. 2000); Lucent Technologies, Inc., v. Lucentsucks.com, 95 F. Supp. 2d 528, 54 U.S.P.Q.2d (BNA) 1653 (E.D. Va. 2000).

43 See the list of non-exhaustive factors, supra.

44 See, e.g., Morrison & Foerster LLP v. Wick, 94 F. Supp. 2d 1125 (D. Co. 2000); Shields v. Zuccarini, 89 F. Supp. 2d 634 (E.D. Pa. 2000) (holding that Zuccarini, an admitted Internet domain name “wholesaler,” violated the Act by registering five variations of plaintiff’s mark); Spear, Leeds & Kellogg v. Rosado, 2000 U.S. Dist LEXIS 3732 (S.D. N.Y. 2000); Virtual Works, Inc. v. Network Solutions, Inc., 106 F. Supp. 2d 845, 54 U.S.P.Q.2d (BNA) 1126 (E.D. Va. 2000). But see Cello Holding v. Lawrence-Dahl Companies, 89 F. Supp. 2d 464 (S.D.N.Y. 2000) (denying summary judgment to Cello Holdings Company, whose uses their trademark “Cello” to sell audio equipment because “cello” is a common noun and a jury would need to determine whether defendant acted in bad faith by registering cello.com and attempting to sell it to several companies which use the word “cello” in connection with their business).

45 See Associated Press, Web Body to Review Domain Proposals, CNETNews.com, Aug. 3, 2000; Aaron Pressman, New Top-Level Domains in Sight, The Industry Standard, July 17, 2000 David McGuire, ICANN Moves Forwards On Domains, Governance, Newsbytes, July 16, 2000; Aaron Pressman, New Domains at Last, The Industry Standard, June 26, 2000 (“Despite some opposition from big business, it looks like Web sites will soon have more names from which to choose. How does ‘.sucks’ sound?”); Ronna Abramson, ICANN’s Plan for Name-Calling, The Industry Standard, June 15, 2000.

46 Declan McCullagh, Free Geeks Want Good Gnus, Wired News, July 12, 2000.

47 See http://www.icann.org/general/faq1.htm: FAQ on new generic top level domains (Posted September 13, 1999)

Q: When will ICANN create new generic top level domains, such as .arts, .shop, .store, .news, .sex, etc.?

A: ICANN and its constituent organizations have recently begun the process of considering whether, how, and when to add new generic top-level domains (gTLDs) to the domain name system. In recent years, a number of plans have been proposed to create new gTLDs, such as .firm, .store, .law, and .arts., and some companies have even taken orders for them. ICANN, which administers the domain name system, has not yet made a decision for or against the addition of new generic top-level domains. The ICANN process provides for the development of consensus-based policies (such as policies concerning new names) in an open, transparent and bottom-up manner in which interested individuals have an opportunity to participate and comment.

There are many arguments both for and against new gTLDs: for example, those in favor argue that new gTLDs are technically easy to create, will help relieve perceived scarcities in existing name spaces, and are consistent with a general push towards consumer choice and diversity of options; those opposed point to greater possibilities for consumer confusion, the risk of increased trademark infringement, cybersquatting and cyberpiracy.

ICANN’s Domain Name Supporting Organization (DNSO) has primary responsibility for making a recommendation on new gTLDs to the ICANN Board. On May 27, 1999, the ICANN Board of Directors referred to the DNSO a set of recommendations on new gTLDs submitted by the World Intellectual Property Organization; the DNSO’s provisional Names Council responded by creating a Working Group to review the issue. Any individual interested in participating in the DNSO’s Working Group on the creation of new gTLDs should visit http:// www. dnso.org/listdnso.html.

48 Ben Charny, ICANN Domain Name Race Is On, ZDNewsNet, Sept. 6, 2000.

49 See New TLD Application Process Overview at http://www.icann.org/tlds/application-process-03aug00.htm.

50 ICANN plans for this to be during or shortly after ICANN annual meeting.

51 ICANN’s Criteria for Assessing TLD Proposals and TLD Application Process FAQs are attached.

52 Oscar S. Cisnerso, Is .biz the .com of the Future?, Wired News, Aug 2, 2000.

53 Graham Lea, ICANN Adds Domains Names, Stores Up Troubles, theregister.co.uk, July 18, 2000.

54 Information about this policy is available at http://www.icann.org/udrp/udrp.htm

55 The policy sets forth several factors to consider as evidence of registration and use in bad faith, including facts which indicate that the registrant

(1) had registered the domain “primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of documented out-of-pocket costs directly related to the domain name;”

(2) has “registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name,” provided that the registrant has “engaged in a pattern of such conduct;”

(3) has registered the domain name “primarily for the purpose of disrupting the business of a competitor;” or

(4) by using the domain name, intentionally attempted to attract, for commercial gain, Internet users to its site or other online location, “by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the registrant’s site or location of a product or service on its site or location.

56 See generally, John Caher, New Domain Arbitration Rules Get Results, N.Y.L.J., Mar. 14, 2000.

57 Jeri Clausing, In New Forum for Domain Name Disputes, Trademark Holders Dominate, New York Times, May 19, 2000. WIPO, one of the authorized arbitration organizations, has a slightly higher percentage of rulings that favor the trademark holder, with roughly eighty percent of the completed cases resulting in the transfer of the domain name. See Almar Latour, U.N. Court Rules in Favor of Telia on Domain Names, Wall Street J., Aug. 14, 2000.

58 Victoria Slind-Flor, Court Curbs Power of ICANN, Nat’l L. J., May 18, 2000.

59 One Web site, the Domain Name Law Reports (found at www.dnlr.com), offers fully summarized ICANN case law on-line.

60 Harvard University was also sued in a preemptive move by “notHarvard.com, which packages online classes with products that might appeal to students.” Patrick Healy, notHarvard Takes Harvard to Court, The Boston Globe, July 28, 2000. Harvard then counter sued notHarvard.com. Oscar S. Cisneros, Harvard Fights ‘Not’ Knockoff, Wired News, Aug. 1, 2000. However, notHarvard recently changed its name to Powered.com and is asking a Texas court to enter a consent decree wherein the parties would agree to dismiss both suits and Powered.com would transfer the domain name notHarvard.com to the school. Katie Dean, NotHarvard.com not NotHarvard.com, Wired News, Sept. 19, 2000.

61 Associated Press, Arbitrator Sides With Dell In Cybersquatting Dispute, The Wall Street J. Interactive Edition, Aug. 22, 2000. Some question whether the trademark owners “deserve” these URLs, suggesting that there are no reasons why Dell shouldn’t sell all its products through it’s main Web site: dell.com. See Kieren McCarthy, The Sick World of Knowledge Behind Cybersquatting, www.theregister.co.uk, August 15, 2000.

62 Id.

63 Elif Kaban, Cybersquatters Ordered to Give Up 40 Web Sites to Yahoo, Reuters, Aug. 14, 2000.

64 Associated Press, Yahoo!, AT&T, Microsoft Win Cybersquatting Cases, mercurycenter.com, Aug. 1, 2000.

65 Ritchenya A. Shepgherd, Counsels’ Domain-Name Pains, Nat’l L.J., Aug. 30, 2000.

66 Reuters, IKEA Wins Eviction of Cybersquatter From Web Site, N.Y. Times, Aug. 17, 2000.

67 Bernhard Warner, Cybersquatters Face Olympic-Sized Lawsuit, The Industry Standard, July 11, 2000.

68 See Domain Disputes, www.nytimes.com, July 28, 2000.

69 See Reuters Ltd. V. Ghee Khaan Tan, WIPO Case No. D2000-0670.

70 Steven Bonisteel, Tacoma Web Developer Bests Giant Fuji in Domain Dispute, Newsbytes, July 7, 2000.

71 Steven Bonisteel, Famed Golf Club in the Rough Over Domain Dispute, Newsbytes, Aug. 31, 2000.

72 EasyJet Airline Co. Ltd. V. Mr. Tim Holt, WIPO Case No. D2000-0465; Reuters, EasyJet Left Up in the Air in Cyberspace, The Industry Standard, Aug. 28, 2000.

73 Frequently, the person who registers a domain name with a celebrity’s name in it wants to sell the domain name to the celebrity, however, a few just want to use the opportunity to meet or have some contact with the celebrity. See Patrick Danner, High-profile Celebrities in South Florida Don’t Own Their Own Names For the Purposes of a Web Site, But It’s OK With Them, Miami Daily Business Rev., July 14, 2000.

74 Ritchenya A. Shepherd, Cyberpirates Now May Have to Walk the Plank, Nat’l L.J., Dec. 16, 1999.

75 In 1955 Rosa Parks fought for her bus seat, an action considered a turning point in the United States civil rights movement; this year she won the rights to www.rosaparks.com, a site created by a man who allegedly planned to auction it off. “The Rosa and Raymond Parks Institute for Self Development in Detroit will use rosaparks.com to educate visitors on civil rights and Mrs. Parks.” Michael Della Bitta, Rosa Parks Takes Her Seat on the Net, www.foxnews.com, Sept. 20, 2000.

76 See Joseph Gallivan, Cybersquatter Gets Evicted, nypost.com, Aug. 9, 2000. See the WIPO Arbitration decision at http://arbiter.wipo.int/domains/html/d2000-0364.html.

77 See the WIPO Arbitration decision at http://arbiter.wipo.int/domains/html/d2000-0475.html.

78 Ben Charny, Madonna Wants Her Name Back, zdnet.com, Aug. 19, 2000.

79 Warren E. Agin, What Is a Domain Name Anyway? Impact of Network Solutions and Umbro Rulings, E-commerce L. & Strategy, June 2000, Vol. 17, No. 2.

80 See Kaplan, Carl S., Copyright Decision Threatens Freedom to Link, Cyber Law Journal, Dec. 10, 1999.

81 Typosquatters not only want to misdirect traffic to their Web site, but also use this traffic to generate advertising revenue: when individuals mistype a popular Web address, the typosquatter places advertisements in hidden browser windows, which very few people see, but for which the advertisers still pay money (to the typosquatter). See Bob Sullivan, Making Money Off “Typosquatting,” www.msnbc.com, Sept. 18, 2000; Bob Sullivan, “Typosquatters” Turn Flubs into Cash, ZDNet, Sept. 23, 2000.

82 See Leigh Jones, Federal Cybersquatter Law Survives Test, N.Y.L.J., Jan 18, 2000.

83 See www.phillipmorris.com.

84 Id.

85 Steven Bonistell, Marlboro Man takes Aim at “Phillipmorris.com,” Newsbytes, June 16, 2000.

86 Cybersquatter Told to Quit Wall Street Journal Sites, Reuters, Sept. 13, 2000.

87 Brian Krebs, Feds Warn Banks About Misleading Web Site Names, Newsbytes, July 19, 2000.

88 A judge may consider “fair use” of a name for satirical or other purposes in determining bad faith. David McGuire, California Passes Sweeping Anti-Cybersquatting Law, Newsbytes, Aug. 23, 2000. “Both the UDRP and the congressional cybersquatting law purport to protect fair use.” Id.

89 Lynda Gledhill, New Law on Cyber Piracy, San Francisco Chronicle, Aug. 23, 2000.

90 Id.

91 David McGuire, California Passes Sweeping Anti-Cybersquatting Law, Newsbytes, Aug. 23, 2000.

92 Cybersquatter Assessed $300,000 in Attorney’s Fees, Mealey Publications, Sept. 15, 2000.

93 Almar Latour, U.N. Court Rules in Favor of Telia on Domain Names, Wall Street J., Aug. 14, 2000.

© 2000 Rob Hassett, Atlanta, Georgia. All Rights Reserved. 

The   information above is provided for general educational purposes and not as legal advice. Laws in areas in which we practice change continually and also  vary from jurisdiction to jurisdiction. Therefore no visitor to our site should rely on any of the articles provided for legal advice, but should   always consult their own attorney regarding legal matters.