Chapter 3
Recent Development in the Domain Name Disputes
This chapter shall be discussing the findings of recent development in the domain name disputes. It shall provide a discussion on the significance of this study to the existing literature. The contents of this portion of the study is gathered and collated from its secondary data.
What is the domain name?
Domain names are simply the addresses of the Internet. E-mail is sent and web pages are found through the use of domain names. As an example, the web address for the Microsoft web site is www.microsoft.com, while Bill Gates might have an e-mail address such as bill@microsoft.com (both using the “microsoft.com” domain name). Without the domain name, a computer would have no idea where to look for a web page, and e-mail routers would not be able to send e-mail. Of course, domain names are more than just addresses, since they can be selected by the “addressee” and are usually closely associated with a particular service or product.
There is an inherent conflict between trademark law and the domain name system. Under trademark law, two or more users of a mark may legally coexist,[1] but in cyberspace multiple users cannot lay claim to a single domain name. To cite a frequently noted example, although United Airlines and United Van Lines both have valid trademark rights in “United” for their respective goods and services, only one party can register united.com. Furthermore, because the costs of complete investigation are prohibitively high, some domain name registries award domain names to the first claimant regardless of whether the name contains another’s trademark, or even whether the registrant has any rights in the word or phrase at all. As such, an individual or company with the foresight to beat a trademark holder to the punch often is able to register a domain name containing any trademark or variation thereof. [2]
Because of this first-come, first-served registration scheme, a party with no rights in a trademark belonging to another sometimes uses it as a domain name to sell competing products or services. Such conduct clearly causes consumer confusion and falls squarely within the prohibitions of infringement law.[3] Cases of this type thus far have been easily addressed under traditional Lanham Act analysis by the United States courts,[4] and presumably would be resolved similarly in other nations adhering to the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which requires its members to provide an exclusive right for registered trademark owners against unauthorized third-party use “where such use would result in a likelihood of confusion.” [5]
However, domain name registration and use give rise to a host of other legal controversies, many of which do not fit so neatly into traditional trademark analysis. The spectrum of domain name disputes covers conduct ranging from conflicts between multiple holders of identical marks;[6] “pure speculation,” the registration of untrademarked popular words as domain names to resell them for profit;[7] and “cybersquatting,” the practice of registering domain names that contain trademarks owned by other parties in order to extract a ransom. (Krisna V. 2001)
The Domain Name System
The Domain Name System, most often known as simply DNS, is a core feature of the Internet. It is a distributed database that handles the mapping between host names (domain names), which are more convenient for humans, and the numerical Internet addresses. For example, www.microsoft.com is a domain name and 130.94.122.199 the corresponding numerical internet address. The domain name system acts much like an automated phone book, so you can “call” www.microsoft.com instead of 130.94.122.199. So, it converts Internet IP addresses like 130.94.122.199 into names like ” www.microsoft.com “.
The legal problems in domain name disputes
Consistency is one of the primary virtues of an organized legal system.[8] As the great United States Supreme Court Justice Benjamin Cardozo once noted, “law as a guide to conduct is reduced to the level of mere futility if it is unknown and unknowable.” [9]In the absence of clear and consistent standards of conduct, individuals act in an economically inefficient manner because they rely on uncertain standards or, in the alternative, may fail to act at all in the absence of clear guidance. Like a government-administered legal system, the UDRP attempts to further consistency through its uniform system of dispute resolution. However, the policy has succeeded only partially at promoting consistent decisions, leaving gaps of incongruity on key issues of domain name registration and use.[10]
Inconsistency in the UDRP is a problem not only for those whose conduct it governs, but also for ICANN, the organization that promulgated the UDRP. ICANN has been the target of a variety of legitimacy critiques since its inception,[11] and the lack of consistency in the application of the UDRP supports these critiques by putting its integrity into question. To preserve its role in the governance of the Internet, ICANN will need to formulate future policies mindful of these attacks on its legitimacy. ICANN therefore should address the problem of inconsistent decisions under UDRP–arguably ICANN’s best-known policy–not only to improve the dispute resolution system, but also to enhance its own integrity.
1. Inconsistent Panel Decisions. One example of an issue on which UDRP arbitration panels have rendered inconsistent decisions is domain name speculation. The UDRP specifically limits its scope to “bad faith” registration and use, (Uniform Domain Name Dispute Resolution Policy, supra note 7) thus appearing to provide a remedy for essentially the same conduct covered by the ACPA, namely traditional cybersquatting. As discussed above, pure speculation is distinguishable from cybersquatting in that it includes situations where no specific trademark owner is targeted.[12] The registrant of business.com, discussed earlier,[13] is an example of a pure speculator.
Although arbitrators have not explicitly drawn this cybersquatting/pure speculation distinction, they appear to have drawn it implicitly, by holding that pure speculation is not in bad faith, as long as the registrant has no actual or constructive knowledge that the registered term is also a trademark.[14] For example, in General Machine Products Co. v. Prime Domains, a unanimous arbitration panel concluded that registration of craftworks.com did not violate the UDRP even though the registrant was in the business of registering generic domains for sale.[15] The panel based its decision in part on the fact that Prime Domains had never registered any other distinctive common law or registered trademarks, and did not solicit General Machines to purchase the name.[16]
However, not every UDRP panel has taken the same stance on pure speculation. One illustrative case is eResolution v. eResolution.com.[17] In eResolution, the panel transferred the domain name in question to the complainant even though the domain name was registered before the complainant commenced business under the name “eResolution” or filed an intent-to-use application for trademark registration.[18] In other words, not only was the registrant unaware that the domain name contained another’s trademark, but notice, constructive or otherwise, would have been impossible because no trademark existed at the time of registration. This decision is in direct conflict with the General Machines outcome and seems to be an improper application of the UDRP. It is a stretch, to say the least, to impute constructive knowledge of a trademark to a registrant to find bad faith where the mark did not exist at the time of registration.
Two recent arbitration decisions concerning domain names ending in the word “sucks” provide another example of inconsistency. Although the UDRP does not use the term “fair use,” The fair use defense recognizes that the property interest in a trademark is not absolute. Rather, a trademark holder has a property right “only insofar as is necessary to prevent consumer confusion as to who produced the goods and to facilitate differentiation between … goods.” These principles are, of course, relevant in the domain name context. In apparent recognition of them, the UDRP provides that “legitimate noncommercial or fair use of the domain name, without intent for commercial gain,” will demonstrate a legitimate interest in the domain name that will thwart the complainant’s attempt to force transfer of the name.
Two recent panel decisions relating to variants of the registered trademark “Wal-Mart” are illustrative. In the first decision, Wal-Mart Stores v. Walsucks, (http://arbiter.wipo.int/domains/decisions/html/2000/d2000-0477.htm) a WIPO panel transferred several domain names, including wal-martcanadasucks.com and walmartpuertoricosucks.com, to the complainant. The decision was based on the panel’s conclusion that the registrations were confusingly similar to the “Wal-Mart” mark and were registered with the bad faith intent of eliciting a ransom from the trademark owner. The panel left open the possibility that other uses of “sucks,” coupled with a trademark, could be allowed as “legitimate freedom of expression sites established by parties critical of trademark holders.” Nonetheless, the decision is puzzling in that it found confusing similarity, despite the extreme unlikelihood that a reasonable consumer would conclude that Wal-Mart is directly affiliated with a website disparaging Wal-Mart.
In a subsequent Wal-Mart case, Wal-Mart Stores v. wallmartcanadasucks, a second WIPO panel explicitly disagreed with the previous decision, stating that it could “not see how a domain name including `sucks’ can ever be confusingly similar to a trademark.” Although this finding alone would have been grounds for denial of transfer, the panel went on to suggest that a “sucks” domain name may qualify as a legitimate vehicle of free expression under the First Amendment to the United States Constitution, and thus fail to qualify as a bad faith use even where, as here, there was very little actual critical content posted on the site. Although, with respect to confusion, this decision seems more properly grounded in the UDRP than the previous Wal-Mart decision, it too is troubling in its explicit reliance on the First Amendment because neither the arbitrators nor the registrant (here, a Canadian) is either constrained or protected by the United States Constitution.
The opposing Wal-Mart decisions, as well as the General Machines and eResolution decisions, illustrate that confusion over critical issues of domain name use has led to inconsistent application of the UDRP. Such inconsistency is a serious problem, as it impedes individual decisionmaking and undermines the integrity of both ICANN and the UDRP. As such, resolving the problem of conflicting decisions should be a top priority for ICANN.
2. The Sources of Inconsistency. The UDRP itself is to blame for much of the inconsistency problem. The policy lends itself to confusion and misapplication because it lacks specificity, a flaw magnified by the fact that precedent plays little role in UDRP decisionmaking. Moreover, the lack of specificity in the policy may facilitate biased decisionmaking (or the appearance thereof).
The UDRP provides that, to prevail in an arbitration, a complainant must assert and prove that the domain name is confusingly similar to a mark in which the complainant has rights, that the registrant has no rights or legitimate interest therein, and that the registration and use of the domain name have been conducted in bad faith. (Uniform Domain Name Dispute Resolution Policy) The policy also lists factors that demonstrate bad faith, as well as defenses by which a registrant can show that it has a legitimate interest in a domain name. However, these lists are brief and, by their terms, nonexclusive, and thus provide inadequate guidance for arbitrators faced with issues not specifically addressed, such as speculation in domain names and fair-use type situations. Moreover, the rules by which arbitrations are conducted encourage broad discretion from panel to panel. The policy provides that “The Panel shall conduct the administrative proceeding in such manner as it considers appropriate in accordance with the Policy,” and allows individual arbitrators to exercise their own judgment as to the admissibility of evidence submitted.
Some commentators have voiced the concern that arbitrators are openly biased toward corporate interests and trademark holders, and that the UDRP, therefore, “`give[s] trademark holders broader rights in cyberspace than they have in the real world.’” This concern, if substantiated, would highlight a flaw in the current system and provide a further explanation for the contradictory decisions discussed in the preceding section. Certainly a number of decisions, including eResolution and Walsucks, seem to stretch the policy in favor of corporate trademark holders.
Special organizations offer domain name
Because of the increasing popularity of the Internet, companies have realized that having a domain name that is the same as their company name or the name of one of their products can be an extremely valuable part of establishing an Internet presence. A company wishing to acquire a domain name must file an application with the appropriate agency. Before doing so, a search is done to see if their desired domain name is already taken. A good site for doing such a search is provided by Network Solutions. When a company finds that the domain name corresponding to their corporate name or product trademark is owned by someone else, the company can either choose a different name or fight to get the domain name back from its current owners.
Some well publicized examples of these types of domain names disputes are:
· candyland.com: Both Hasbro and an adult entertainment provider desired the candyland.com domain name. Hasbro was too late to register the name itself, but it is never too late to sue (well, almost never). The domain name is now safely in the hands of Hasbro.
- mcdonalds.com: This domain name was taken by an author from Wired magazine who was writing a story on the value of domain names. In his article, the author requested that people contact him at ronald@mcdonalds.com with suggestions of what to do with the domain name. In exchange for returning the domain name to McDonalds, the author convinced the company to make a charitable contribution.
- micros0ft.com: The company Zero Micro Software obtained a registration for micros0ft.com (with a zero in place of the second ‘o’), but the registration was suspended after Microsoft filed a protest. When the domain name went abandoned for non-payment of fees, the domain name was picked up by someone else: Vision Enterprises of Roanoke, TX
- mtv.com: The MTV domain name was originally taken by MTV video jockey Adam Curry. Although MTV originally showed little interest in the domain name or the Internet, when Adam Curry left MTV the company wanted to control the domain name. After a federal court action was brought, the dispute settled out of court.
- peta.org: An organization entitled “People Eating Tasty Animals” obtained the peta.org domain name, much to the disgust of the better know People for the Ethical Treatment of Animals. This domain name was suspended, but as of May 2000 the domain name was still registered in the name of People Eating Tasty Animals.
- roadrunner.com: When NSI threatened to suspend the roadrunner.com domain name after a protest by Warner Brothers, the New Mexico Internet access provider who was using the domain name filed suit to prevent the suspension. Although the access provider was able to prevent the suspension, a joint venture company involving Time Warner, MediaOne, Microsoft, Compaq, and Advance/Newhouse eventually obtained the domain name.
- taiwan.com: The mainland China news organization Xinhua was allowed to register the domain name taiwan.com, much to the disgust of the government of Taiwan.
References:
Mark Radcliffe, Trading on Your Brand Name, LEGAL TIMES, Feb. 14, 2000, at 38.
Joshua Quittner, What’s in a Name? Some Net Addresses Are as Precious as Madison Avenue Real Estate, TIME, June 24, 1996
1114, 1125 (1994 & Supp. V 1999) (codifying the likelihood of confusion standard for infringement of registered and unregistered marks).
MCcarthy J.T., MCCARTHY ON TRADEMARKS AND UNFAIR COMPETITION [section] 25.76 (4th ed. 2000) (explaining how the use of a domain name could be a form of infringement).
Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, art.
33 I.L.M. 1197, 1203 [hereinafter TRIPS].
Moragne v. States Marine Lines, Inc., 398 U.S. 375,403 (1970) (discussing “the desirability that the law furnish a clear guide for the conduct of individuals, to enable them to plan their affairs with assurance against untoward surprise”).
BENJAMIN N. CARDOZO, THE GROWTH OF THE LAW 3 (1924).
David Post, founder of the public interest group ICANNWatch:
Bayers, supra note 70, at 32. In addition, one of the most respected and reasoned critics,
James Boyle, A Nondelegation Doctrine for the Digital Age?, 50 DUKE L.J. 5, 14 (2000).
Uniform Domain Name Dispute Resolution Policy, supra note 7, [section] 4a(iii).
(98.) See, e.g., Gen. Mach. Prods. Co. v. Prime Domains, FA0001000092531 (Nat’l Arb. Forum Jan. 26, 2000) (on file with the Duke Law Journal)
Gen. Mach. Prods., FA0001000092531.
Kompan Inc., v. TheBigstore.Com, FA0003000094322 (Nat’l Arb. Forum Apr. 18, 2000) (on file with the Duke Law Journal) (refusing to transfer bigtoys.org); Dog.com, Inc. v. Pets.com, Inc., FA0093681 (Nat’l Arb. Forum Mar. 31, 2000) (on file with the Duke Law Journal) (refusing to transfer dogs.com).
No. D2000-0110 (WIPO Apr. 10, 2000), available at http://arbiter.wipo.int/domains/ decisions/html/2000/d2000-0110.html (on file with the Duke law Journal). The eResolution complainant, interestingly, was one of ICANN’s four approved dispute resolution providers. Id.
U.S.C. [section] 1115(b)(4) (1994 & Supp. V 1999).
U.S. CONST. amend. I (“Congress shall make no law … abridging the freedom of speech….”).
Int’l Order of Job’s Daughters v. Lindeburg & Co., 633 F.2d 912, 919 (9th Cir. 1980).
Uniform Domain Name Dispute Resolution Policy, supra note 7, [section] 4c.
No. D2000-0477 (WIPO July 20, 2000), available at http://arbiter.wipo.int/domains/ decisions/html/2000/d2000-0477.html (on file with the Duke Law Journal).
Wal-Mart Stores, Inc. v. wallmartcanadasucks.com, no. D2000-1104 (WIPO Nov. 23, 2000), available at http://arbiter.wipo.int/domains/decisions/html/2000/d2000- 1104.html (on file with the Duke Law Journal).
Uniform Domain Name Dispute Resolution Policy, supra note 7, [section] 4a.
Rules for Uniform Domain Name Dispute Resolution Policy, ICANN, Rule 10(a), at http://www.icann.org/udrp/udrp-rules-24oct99.htm (last visited Nov. 1, 2001) (on file with the Duke Law Journal).
[1] Mark Radcliffe, Trading on Your Brand Name, LEGAL TIMES, Feb. 14, 2000, at 38.
[2] Joshua Quittner, What’s in a Name? Some Net Addresses Are as Precious as Madison Avenue Real Estate, TIME, June 24, 1996
[3] Ibid.
[4] Ibid.
[5] Ibid.
[6] Krisna V. 2001
[7] supra. Krisna V. 2001
[8] BENJAMIN N. CARDOZO, THE GROWTH OF THE LAW 3 (1924).
[9] Ibid.
[10] supra. Cardoza 1924
[11] James Boyle, A Nondelegation Doctrine for the Digital Age?, 50 DUKE L.J. 5, 14 (2000)
[12] Ibid.
[13] Ibid.
[14] Kompan Inc., v. TheBigstore.Com, FA0003000094322 (Nat’l Arb. Forum Apr. 18, 2000) (on file with the Duke Law Journal) (refusing to transfer bigtoys.org); Dog.com, Inc. v. Pets.com, Inc., FA0093681 (Nat’l Arb. Forum Mar. 31, 2000) (on file with the Duke Law Journal) (refusing to transfer dogs.com).
[15] Ibid.
[16] Ibid.
[17] No. D2000-0110 (WIPO Apr. 10, 2000), available at http://arbiter.wipo.int/domains/decisions/html/2000/d2000-0110.html (on file with the Duke law Journal). The eResolution complainant, interestingly, was one of ICANN’s four approved dispute resolution providers. Id.
[18] Supra. Nationa;l Arab Forum 2000
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