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Domain Names Present New Challenges
by Maureen Sirhal
The number of Internet domain-name disputes has increased steadily in the last few years, creating concern in the Internet community that domains are becoming the exclusive province of corporations. Yet companies increasingly protective of their trademarks are wary of the technologically savvy people who are claiming domains that mimic corporate brand names.
The Domain Name System (DNS) effectively serves both as a forum for branding products and as a haven for free speech and communication, and the battles over various domains highlight the difficulty of striking a balance between maintaining the Internet as the foundation for future communication and fostering e-commerce. But many groups differ over whether to segment the system, a solution that could be just as controversial as it is helpful.
A Mandate For Names
When the Internet Corporation for Assigned Names and Numbers (ICANN) was formed, one of its key priorities was to expand the DNS' capacity. As part of its contract with the federal government, ICANN had to prove that it could introduce new suffixes to complement the traditional domains like .com without sacrificing the stability of the entire system. But in the year since ICANN approved seven new domains, ICANN's process has been marred by controversy.
Throughout the process, ICANN stressed the importance protecting intellectual property. It required all new registries -- the companies that manage the various domain-name suffixes -- to work hard to protect brand names on the Web.
Some registries -- such as Afilias, which oversees .info domains -- instituted "sunrise periods" during which only trademark holders could register their brands. Yet allegations still emerged in July that non-trademark holders were illegally registering trademarked names.
The result has been a bevy of legal threats and a lengthy arbitration process to filter the non-trademark registrations. The granting of rights to popular generic names -- america.info, insurance.info and airlines.info, for example -- has been delayed while the World Intellectual Property Organization (WIPO) ponders more than 200 cases of allegedly illegal .info registrations.
The process could create a huge setback for adding names to the DNS. Some experts fault the Uniform Dispute Resolution Policy, the system created to address cyber squatting.
The rollout of the .biz domain also has triggered controversy. In late August, Arizona businessman David Smiley sued NeuLevel, the company that won the rights to sell .biz domains, alleging that NeuLevel's system constitutes an illegal lottery. Registrants pay a fee and submit the names they wish to register. But just registering a name does not guarantee a right to it.
The lawsuit also is against ICANN and the retailers that contracted with NeuLevel to offer .biz domains. ICANN argued in a recent brief that any delay in the rollout of .biz domains, which is what Smiley requested, could harm the stability of the Internet.
A Booming Domain Marketplace
The controversies are causing concern because they reduce the momentum for greater segmentation of Internet addresses. Groups such as such as the Consumer Federation of America, National League of Cities, Information Technology Association of America and the National Education Association see an abundance of domain-name suffixes as a key to curtailing cyber squatting. They recently began a campaign to reserve space under .us for non-commercial use.
Kathryn Kleiman, director of the Association for Computer Machinery's Internet Governance Project and an intellectual property and telecommunications attorney with McLeod, Watkinson & Miller in Washington, said non-commercial groups have few options for domains when confronted with challenges from well-funded trademark holders.
"With scarce availability in the .com name space, non-commercial groups increasingly find they are beaten to the punch when it comes to registering names," she said. That is particularly true for the municipalities and government groups just now adopting the Internet as a means for offering services and transactions.
Some government officials also want to move their Internet operations beyond the domains designated for entities like cities or countries. Some cities are even filing claims to win the rights to .com extensions. City officials in Salinas, Calif., recently lost their bid against one of its residents. Sunnyvale, Calif., has considered similar proceedings, and officials in Dearborn, Mich., recently filed to claim the rights to a domain bearing the city's name.
"Too many people are trying to get too few good [.com] domain names," said Kleiman.
All Trademarks, All The Time
Trademark holders have their own domain problems. Companies increasingly register their trademarks under the three more common extensions -- .com, .net and .org -- and also under misspellings of their brands in an effort to prevent trademark dilution.
Jessica Litman, a professor at Wayne State University and trademark expert, said one reason companies are so defensive in their trademarks is because of the belief that once a famous mark has been abused without a challenge, the trademark owner loses all rights to the name. The problem with that view, Litman said, is that "there is a difference in perception between trademark holders and everybody else as to whether the trademarks are famous. Anyone with the most mundane trademark thinks it is famous."
Decisions in some recent domain-name disputes, however, reveals that individuals or businesses that register more generic name may be finding more favor with arbitrators.
Still, nearly 80 percent of WIPO cases result in victories for trademark holders. And disputes resolved outside of WIPO favor trademark holders in more than 50 percent of all cases, according to Michael Geist, a professor at the University of Ottawa who specializes in Internet law.
Geist's report, "Fair.com? An Examination of the Allegations of Systemic Unfairness in the Uniform Dispute Resolution Policy," asserted that the forum for dispute resolution tends to impact the outcome of the cases. The party filing a complaint is most likely to select forums that are more likely to rule in their favor.
Litman argues that the growth in domain disputes can be linked to their value. Because ICANN has been so slow to offer more extensions, individuals and firms are likely to keep relying on the choices already available. "If you eliminate the scarcity and drive the market price to zero ... there is less of an incentive to engage in arbitrage behavior," she said.
Litman and other several other trademark experts, say the real test may come when the domain suffixes .museum and .coop become available. Those names may provide a better litmus test to determine how much easier it is for non-commercial entities to obtain desired domains targeted at specific sectors.
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