Registration Roundup on the Internet–Trademark Surfing
in Domain Name Space

By Al Harrison and James Carmody

Origin of the Internet

Long, long ago in cybertime, back in the early 1980’s, the primordial ooze of early chip electronics and several other technologies emerge onto the dry land that would become today’s Internet.1 Milestones in the early 1980s included the 1981 appearance of the IBM PC; the 1982 replacement of the Vietnam-era AUTOVON voice network of US worldwide military bases with the Defense Data Network (building on university packet research at a handful of prominent institutions); and the 1982 to 1989 increase in the number of accessible online hosts from 200 to over 100,000.2 Online access became a reality via primitive search engines affectionately named “Archie” (1990) and “Veronica” (1992).3

Several major hurdles had to be jumped before the dial-up, electronic bulletin board systems-driven networks could resemble today’s World Wide Web.4 One of the earliest involved the need for each computer, server, or router to be individually identifiable so that “packets” of information could be verifiably sent and received. Accordingly, each hardware device electronically communicated its identity via its prescribed Internet Protocol (“IP”) address, which corresponded to routing address instructions across the Internet.

An IP address consists of 32-bit numbers normally expressed as four octets, with each octet corresponding to decimal numbers separated by dots or periods,5 aptly termed a “dotted-quad” IP address format. For example, dotted-quad 204.254.232.199 corresponds to the IP address for the HBA’s Web site, otherwise known as www.hba.org. Although this addressing scheme accommodates about 4 billion unique hardware device locations, the dotted-quad combinations were cumbersome and commercially unappealing.6

Genesis of Domain Name System
To save the day, the Domain Name System (“DNS”) appeared on this electronic landscape as a means to assign symbolic names to each dotted-quad combination. DNS is an enormous, distributed database that converts or translates a human-intelligible domain name into a corresponding machine-readable IP address prerequisite for transmitting multimedia data across the Internet. Six noteworthy aspects of this conversion process are integral to Web functionality: (1) for the billions of active IP addresses, most servers have a human-intelligible domain name; (2) billions of DNS requests are effectuated on a daily basis; (3) a typical user effectuates more than 100 DNS requests daily; (4) some domain names and IP addresses change regularly; (5) new domain names are created daily; and (6) millions of personnel have the responsibility for performing myriad changes and additions required to sustain the active 1:1 relationship between domain names and IP addresses. In May of 1993, the National Science Foundation awarded Network Solutions (“InterNIC”) seed funding for registration of domain names. Initially, domain name registrations occurred at a phenomenal rate of 400 registrations per month. Two years later, this registration rate had increased dramatically to 4 million Internet host sites; by 1999, that number quadrupled to 16 million.7

Domain Name Space
Domain name space consists of a hierarchy of names having a limited number of authorized generic top-level domains (“gTLDs”), e.g., com, net, edu, org. The top-level domain (“TLD”) is positioned as a (right-most) suffix in the domain name string. TLDs are subdivided into second-level domains (“SLDs”) each of which is positioned as a prefix to a particular gTLD, such as <hba.org>. These SLDs may be further subdivided into lower-level domains as deemed advantageous to the domain name registrant’s purposes.

Country code, or national top-level domains (“ccTLDs”), are administered by the implicated governments or by government-authorized private entities. Examples of ccTLDs are “ca” (Canada), “cn” (China), “jp” (Japan), and “uk” (United Kingdom).
The prevalent gTLDs are synonymous with intended purposes of allocated portions of domain name space. Thus, the “com” gTLD domain was allocated to commercial users; the “net” gTLD was allocated to network service providers; the “org” gTLD was allocated to non-profit organizations; the “gov” TLD was allocated to government entities; and the “edu” gTLD was allocated to educational institutions. Thus, absent the unwelcome incursion of cybersquatters, order would have ruled in domain name space.

Incursion of Cybersquatters
As the registration of domain names evolved in the mid- to late-1980s, “cyber-entrepreneurs” contemporaneously registered multiple domain names, essentially squatting upon virtual or electronic real estate that corresponded to hardware nodes disseminated along the “information superhighway.” These cyber-entrepreneurs registered or tried to register thousands of domain names containing famous commercial trademarks, presumably hoping that the owners (or competitors of the owners) would pay a handsome fee for the right to become the registrant of the domain names. Hence, the birth of “cybersquatters.”8

What were trademark owners to do when facing cybersquatters? Did trademark infringement litigation constitute a viable approach for solving the problem? Early domain name litigation highlighted the jurisdictional and jurisprudential complexities implicated in Internet disputes.9 Personal jurisdiction attaches if a court may assert either general or specific jurisdiction over a defendant.10

or instance, in Cybersell, Inc. v. Cybersell, Inc., 11 plaintiff Cybersell of Arizona, who had a pending application for federal registration of its “Cybersell” mark, sued Cybersell of Florida for creating a homepage with “cybercell” as its domain name in conjunction with Web-related services. Cybercell of Florida, which conducted no commercial activity specific to Arizona,12 moved to dismiss for lack of personal jurisdiction.13 Rejecting the Arizona company’s argument that the defendant should face suit in Arizona since “cyberspace is without borders and since website advertising is necessarily intended for use on a world wide basis,” the Court held that creating a static web site, without more, was insufficient to create personal jurisdiction in Arizona.14

Establishing jurisdiction proved to be unpredictable, absent facts clearly demonstrating that a defendant had purposefully taken advantage of the benefits and protections of the plaintiff’s venue.15 The Fifth Circuit found no personal jurisdiction for a Web site maintained in New York City by the Columbia Journalism Review for seeking subscribers and advertisers, and which obtained only minimal subscribers in Texas.16 For example, consider a Delaware corporation that owns a registered trademark, and a Cayman Islands resident is cybersquatting on the domain name containing that trademark. Where does personal jurisdiction lie? What substantive law should be applied? Does the Delaware corporation have any chance of obtaining relief from the cybersquatter?

Congressional Creation of ICANN
To address the emerging cybersquatting trend, Congress chartered the Internet Corporation for the Assignment of Names and Numbers (“ICANN”) in 1998. ICANN’s mission is to bring order to the exploding Internet besieged by chaos and growing pains.17 Within a year, Congress passed the AntiCybersquatting Consumer Protection Act (“ACPA”),18 and ICANN developed the Uniform Domain Name Dispute Resolution Policy (“UDRP”), which is binding on all registrars of the generic and ICANN sponsored domain names. The ACPA and UDRP created closely-related mechanisms to resolve disputes between trademark owners and domain name registrants.19

A domain name registrant must contractually agree to the terms of the UDRP or the applicable dispute resolution procedure. Both the ACPA and the UDRP focused on the domicile of the domain name registrar and dealt with the domain name on an in rem basis, i.e., without the need for personal jurisdiction over the putative cybersquatter. The only relief available in a UDRP arbitration proceeding is transfer of the domain name to the prevailing trademark owner. ACPA litigation, which takes place in federal district court, although potentially more expensive, may resolve many more aspects of disputes between the parties and may award damages and attorney’s fees.

Today, about 1.8 million trademarks are registered or have pending applications for registration at the U.S. Patent and Trademark Office.20 (Compare this with about 476,000 listings in Webster’s Third New International Dictionary, Unabridged.)21 The number of common law trademarks claimed is elusive.

omain name registrations, however, are multiplying, with more than 77 million active registrations, 202 million canceled, and not quite one million added and deleted every day.22 Many businesses and individuals register multiple domain names for commercial and personal purposes. A collision course was inevitable!

Trademark Owner - Cybersquatter Confrontation: Arbitration Procedures
What steps should be taken by counsel when a client faces a domain name dispute? This issue is particularly thorny when the trademark holder is a domestic company, and the domain registrant “cybersquatter” is a foreign national. Without personal jurisdiction over the international cybersquatter, a trademark holder could seek to assert jurisdiction over the registrar of the domain, unless the registrar also is a foreign company offering to establish a domain at a bargain price.23 While an available option is to seek to shut down the cybersquatter in rem in its home country, prosecuting a domain name dispute in rem via a U.S. district court is apt to be impracticable and too costly to enforce even if judgment against the cybersquatter or its registrar were granted.

A recommended cost-effective course of action is to invoke the stipulated (UDRP) agreement to arbitrate. Most of the registrars in the world are chartered by ICANN and require their registrants to agree to a standard procedure in the event of a conflict between a trademark and the registered domain name.24 This procedure is fast (usually three months or less) and inexpensive ($1,300 for a single arbitrator and $2,600 for a panel of three under the current National Arbitration Forum fee schedule). Also, extensive online publication of prior panel decisions and concomitant pleadings provide a ready resource of guidelines for case preparation. The two largest providers of ADR services involving the UDRP handle 96 percent of all cases:25 the World Intellectual Property Organization (WIPO), which is a UN agency headquartered in Switzerland, handles 54 percent,26 and the National Arbitration Forum (NAF), headquartered in Minneapolis, handles 42 percent.27 Many arbitrators serve on both WIPO and NAF panels.
The UDRP allows either party to appeal an arbitration decision within ten days by filing suit in a U.S. federal court (or equivalent court in a foreign country) for a de novo trial on the merits.28 Otherwise, the registrar of the domain “unlocks” the domain name for use consistent with the panel’s decision. The short fuse for seeking relief in federal court and the high cost in both dollars and time associated with federal litigation effectively assure that a UDRP decision will be final in most cases.

To prevail at arbitration or trial, a complaining trademark owner must prove three elements: (1) the domain name must be identical or confusingly similar to a trademark or service mark in which the complainant has rights29; (2) the respondent registrant of the domain name must have no rights or legitimate interests in the domain name30; and (3) the domain name at issue must have been registered and have been used or misused in bad faith.31
If a domain name registrant can defeat or at least raise a legitimate fact issue on any of these elements, the arbitral panel will usually rule in its favor and refuse to transfer the domain name to the complainant. Interestingly, it is not unusual for a complainant to be a disgruntled information technology (“IT”) employee or webmaster who originally registered the domain in good faith on behalf of an employer, and now has compensation or other issues with the employer-trademark owner. In such a situation, the UDRP panel will usually defer to the other forum and decline to grant relief (but without prejudicial effect).32

Applicability of Established Trademark Law
There are many difficult issues that can arise in domain name cases and that illustrate why “Internet Law” does not always sit well with traditional trademark law. For example, while there can only be one commercial site with a particular domain name such as “keystone” <www.keystone.com> on the Internet, many trademarks (registered or otherwise) involving the literal term “keystone” may coexist. Indeed, more than 200 keystone-related records may be found on the U.S. Patent & Trademark Office Web site among its 45 international classes of goods and services.33
Realizing this significant limitation, ICANN originally hoped that overcrowding among multiple users of a single mark would be solved by allowing additional TLDs in addition to the ubiquitous “com” — net, org, biz — or by adding country-of-origin codes. Nevertheless, trademark owners typically seek to control all domains containing their marks, regardless of the TLD. Trademark owners are well-advised to actively “police” their trademarks to safeguard valuable trademark rights not only to prevent unfettered use of confusingly similar trademarks, but also to prevent disparagement of their company, its products, and/or services, and to prevent dilution of their corresponding reputations.

eTrademarks: Trademarks on the Electronic Landscape
Even if jurisdiction were established in a domain name dispute, is it clear that conventional trademark law would apply? Stated differently, does a domain name inherently function as a trademark wherein conventional trademark law attaches? Of course, well-settled trademark law antedated the advent of the Internet. Trademarks, unlike patents and copyrights, are designed to influence consumers of products and services: a trademark develops, in the minds of consumers, an association between the trademark and the origin of the goods and/or services. Thus, “good will” relative to consumers is an essential ingredient of an effective trademark. Lanham Act34 and Texas statutory35 definitions construe a trademark to mean any word, name, symbol, device or slogan that identifies and distinguishes goods from like goods made or sold by other parties, and indicates the source of such goods.

Broadly construing the terms “symbol” and “device,” both the Lanham Act and Texas definitions of trademark substantially cover the physical waterfront and the virtual electronic landscape.36 Under Texas law, a trademark may be established only by being adopted and used in commerce.37 Under the Lanham Act, a trademark also may be established by a bona fide intention to use a mark in commerce in conjunction with the goods. Actual use identifies and distinguishes goods from like goods made or sold by other parties, and indicates the source of such goods.38 “Use in commerce” upon goods is broadly construed under the Lanham Act to include placement of a mark in any manner thereon or on containers therefor, or displays associated therewith, or on tags or labels affixed thereto, or, if the nature of the goods renders such placement impractical, then on documents associated with the goods or sale thereof; and the goods being sold or transported in commerce.39

The strength of a mark affords insight into its inherent ability to perform the basic trademark function of distinguishing goods and/or services from competitors’ similar goods and/or services. Strength of a mark may be classified into five categories of increasing distinctiveness, wherein a mark (seeking to achieve status as a trademark) may be: (1) generic; (2) descriptive; (3) suggestive; (4) arbitrary; or (5) fanciful.40 Generic marks such as “elevator,” “aspirin” or “pencil” devolve to devices that refer to a genus to which  particular products correspond. Accordingly, generic marks (actually not “marks” at all) are incapable of performing fundamental trademark identification and distinguishing functions.41 Descriptive marks, somewhat similarly, correspond to devices that merely describe goods and hence also are incapable of identifying the sources from which such goods originate; descriptive marks are not inherently distinctive, and no trademark functions are performed. No trademark status can be accorded to a merely descriptive mark.42

The remaining three categories are inherently distinctive and are entitled to trademark status and its concomitant protections.43 In particular, suggestive marks are devices that rely upon consumers’ imagination for suggesting certain characteristics and qualities related to the goods. For instance, White Cloud toilet tissue suggests a pure, soft product. Proceeding up the trademark strength scale, arbitrary marks are devices that have no meaning either relative to particular goods or even to any goods. Examples of arbitrary marks that have unrelated meanings are Corfam synthetic leather and Velcro fasteners. Fanciful marks are devices that, while normally having no meaning, are posited in commerce in conjunction with goods and services. Examples of arbitrary marks are Poqet, Compaq and Palm computers, EXXON petroleum products, and Terminix pest control. Arbitrary and fanciful marks, and, to a lesser extent, suggestive marks, are strong marks that intrinsically serve to identify particular sources of products and services.44

In view of a domain name devolving to a symbolic address that may be routinely translated into a corresponding IP address, its grass roots function is to serve as a pointer to a Web page situs, i.e., to a “street address” on the information superhighway. A domain name does not necessarily relate to the identification of the source or origin of a vendor’s products and/or services, or, indeed, to the vendor, per se. Frequently, the opposite situation arises on the electronic landscape, wherein domain names perform invaluable commercial functions of advertising and promotion, one basis for disputes.

Supplementary Bases for Domain Name Disputes
Besides domain name disputes arising from trademark law under a likelihood of confusion or mistake theory, several other bases for such disputes exist. Within the unfair competition umbrella, for instance, a trademark owner may allege a dilution theory, an initial interest confusion theory, or both. Trademark dilution law is not based on protecting consumers of goods and services from being confused or mistaken, but on protecting commercial marks and associated good will from being watered-down due to competitors’ illicit behavior in the marketplace.45 That is, dilution attenuates the value of trademark rights by blurring the ability of a trademark to uniquely identify particular goods and services with the trademark owner. Initial interest confusion occurs when a party other than the trademark owner exploits a famous or well-known mark to garner immediate and initial recognition by members of the public.

For instance, in Dr. Seuss Enterprises, LP v. Penguin Books USA, Inc., Penguin Books adopted the similar title “The Cat NOT in the Hat!” and the stove pipe hat to capture consumers’ initial attention, even though no actual sales flowed therefrom.46 Citing Mobil Oil Corp. v. Pegasus Petroleum Corp., in which the flying red horse as an arbitrary and inherently strong mark was accorded a “large[r] cloak of protection,” the Dr. Seuss Court observed that defendant’s probable reason for selecting Dr. Seuss’ mark was to draw consumer attention to what would otherwise be another run-of-the-mill book pertaining to the O.J. Simpson murder trial.47

Other representative trademark-related activities of cybersquatters include misuse or abuse of established trademarks by specifying fraudulent and/or deceptive “deep-linking” and metatags entrenched beneath the Web site surface. Deep-linking occurs when a Web surfer is directed to a Web page subordinate to or beneath a Web site’s homepage,48 wherein the homepage is avoided. Metatags are integral to a Web site’s underlying code and function as keys relied upon by search engines for locating hits based upon specified search criteria.49

 Still other issues involve so-called “gripe sites” which pit free speech rights against trademark protection rights. For example, <retailerxyzsucks.com> may be offensive to Retailer XYZ, but it would be disingenuous to say that the domain name is identical or confusingly similar to the retailer’s registered trademark. UDRP decisions vary on this issue, depending upon whether the site is used for griping or for willfully diverting Web surfers to competitors’ sites or to pornographic sites.50

The first UDRP case was World Wrestling Federation Entertainment, Inc. v. Michael Boseman, in which Boseman registered <worldwrestlingfoundation.com> and tried to sell it to the complainant for $1,000. Since that case was issued by WIPO in December of 1999,51 many UDRP cases have involved the alleged intellectual property of major companies and famous individuals. For example, an early 2000 case involving actress Julia Roberts decided that trademark registration of her well-known name was not necessary; “Julia Roberts” had sufficient secondary association in the mind of the public to establish common law trademark rights for UDRP purposes.52 Another famous star, Richard Starkey (“Ringo Starr”) was successful in obtaining a transfer of <ringo-starr.net> from an environmental activist who deceptively claimed to be maintaining a “fan site.”53 On the other hand, Gordon Matthew Thomas Sumner, professionally known as “Sting,” was not so fortunate in seeking to have the domain name <sting.com> transferred to him from an alleged cybersquatter, due to there being many other associations with the term “sting.” Indeed, under the panel’s conservative interpretation of the scope of the mission of the UDRP,54 Sumner’s complaint was rejected.

Recommendation: eDiligence
While early domain name cases under the UDRP offered up divergent results in similar cases, several years’ experience evolved into predictable “Net jurisprudence.” Counsel representing either a trademark owner or a domain name registrant have online access to a treasure trove of past UDRP decisions on how to proceed judiciously on the e-landscape. While these decisions do not necessarily carry precedential weight, practically every UDRP panel decision cites to others, and, indeed, U.S. federal courts have cited to UDRP decisions.55

Diligently representing clients in the commercial marketplace, in view of the Internet and its unlimited and virtually uncontrollable reach, introduces new challenges under the relatively quiescent unfair competition umbrella. From cybersquatting to spam control to safeguarding networks from intrusions including a virus, a worm, a Trojan Horse, “spyware” or, unfortunately, virtually any other form of unauthorized access, e-diligence is the order of the day. While lawyering domain name and trademark issues on the e-landscape, counsel should strive to encompass aggressive broad-base contemporary unfair competition legal principles. Unavoidable challenges to keep abreast of a panoply of burgeoning issues and side-issues, many of which may be subtle (and sub-websurface), have become ingrained on the e-landscape. Coping with this state of affairs is a given. But how?

Online search engines and the diverse information available at previously cited ICANN, NAF and WIPO Web sites are invaluable tools. As demonstrated by this discussion of the not-always-friendly interface between trademarks and domain names, an understanding of rapidly-developing Internet law is crucial to the legal representation formula. For practitioners who do not regularly engage in intellectual property matters or who have not engaged in disputes involving trademarks and/or domain names, it is imperative to subsume e-landscape factors into the legal representation formula. Numerous excellent treatises have been written on this topic, including The Law of Computer Technology and Information Law treatises by Raymond T. Nimmer56 and McCarthy on Trademarks and Unfair Competition by J. Thomas McCarthy.57

Similarly, if a client plans to form a corporate entity, a matter seemingly far-removed from intellectual property issues and the Internet, counsel should not rely solely on the profoundly useful site enabled by the Texas Secretary of State58 or the Secretary of State of a sister state if appropriate. Instead, counsel should perform trademark and domain name searching and reconnaissance implicated by the proposed name or names to ascertain its possible impact on the e-landscape. A recommended initial step is to visit the freely available Web site of the U.S. Patent & Trademark Office, and search for existing trademark registrations and pending trademark applications. If one or more hits are obtained wherein there appears to be potential for likely confusion or mistaken identity with other registrants, then that will probably end the inquiry. If, however, the name appears to be available, then a more extensive follow-up trademark search may be meritorious. Depending upon the nature and extent of the situation being handled, other Web-based resources can be searched for pertinent domain registrations. This will help assess the availability of the proposed business entity name.

Another effective and efficient way to explore the e-landscape is to use an electronic database such as the Westlaw Trademark Practitioner,59 which has a search tab that facilitates research on trademark and trade name-related issues. With tools like these, counsel is able to search for not only pertinent federal and state trademarks, but also Canadian, European and even worldwide trademark registrations or pending applications, under the auspices of WIPO. Counsel may also seek common law trade names and other branding, through Thomas Register online and the like, and may also search for already-registered domain names.

Regardless of how counsel arrives at the e-landscape e-diligence destination,60 however, the challenge is clear: domain name issues are virtually intertwined with trademark issues. The twain has met and will continue to meet in cyberspace.

Al Harrison is a patent attorney practicing intellectual property and computer law in Houston with his wife Ronnie, under the Harrison Law Office, P.C. banner. He received his J.D. from the University of Houston Law Center and is a member of The Houston Lawyer  Editorial Board.

James A. Carmody has an intellectual property and general practice of law in Houston and has served as a panelist on numerous NAF and WIPO panels involving domain name disputes. He was a member of the ICANN Uniform Domain Name Dispute Resolution Policy Task Force (2001-2002).

The authors thank Kristine Dorrain, Internet Legal Counsel for the National Arbitration Forum, who provided background for this article.

Endnotes

< BACK TO TOP >