Newspaper Articles

This collection of articles was published in the Detroit Legal News from 1995-1997. All were written in the infancy of the modern Internet, before the landscape surrounding Internet legal and business issues began to develop. Access to the Internet largely consisted of dial-up connections on a 14.4 kbs modem or slower. Both the technology and state of the law have evolved considerably since these were first published.

Domain Names Are a Valuable Commodity

Originally published May 15, 1996

It's all in the name. Domain name, that is.

Internet domain names are the electronic schizophrenic sister of business, product or trade names. They are a raging source of controversy in the trademark/tradename arena.

A domain name is a plain English address (as opposed to a numerical IP address) of an Internet site or location. For example, the domain name of the Detroit Legal News web site (after the standard Web identifiers: http://or http://www.) is legalnews.com.

Domain names end with the following extensions which identify the nature of the Internet site: corn (commercial), org (organization),' .gov (government) and edu (educational). They are registered with the Internet Network Information Center (InterNIC), a non-profit agency whose registration process is administered by Network Services, Inc. (NSI). Domain names are generally registered by the NSI on a first come, first serve basis.

Distinctive or easy to remember domain names provide Internet users with a convenient way to find locations of sites containing particular information, products or services. As a result, domain names are a valuable marketing resource.

Many companies are adopting domain names that identify them or their products to the growing base of Internet users.

Others are finding that the domain names they are interested in are taken by scavengers or other users with a legitimate relationship to the desired name.

There are already numerous lawsuits regarding entitlement to domain names.

Take the controversy between Hasbro, the maker of the ever-popular children's game "Candyland," and Internet Entertainment Group (IEG), the proprietors of the candyland.com, an electronic erotica Web site.

IEG claims it spent over $700,000 in connection with candyland.com, including expenses in purchasing and advertising the name. Hasbro has charged that the use of the candyland name infringes, tarnishes and dilutes a trademark which it spent considerable capital developing.

Several months ago a federal district court in Washington issued a preliminary injunction against IEG and ordered it to immediately remove all content from the candyland.com site. IEG was permitted to post a referral notice on the candyland site giving the URL of its new site but it could not hyperlink to its own or any other site in connection with the notice.

Similar battles are being waged in courts across the country.

Domain name issues in many respects transcend traditional trademark law which focuses on the likelihood of confusion in competing marks. Multiple trademarks for the same name but different goods or services are common. On the other hand, only one party may have a domain name ending in a particular extension (.com, org, etc.)

For example, in the Candyland controversy, IEG submitted evidence of 23 trademark applications and registrations involving variations of "candyland."

Domain names also may be issued for words and phrases not eligible for trademark protection because they are descriptive, functional or otherwise not protectable. As a result, flowers.com, books.com and software.com may all be registered as domain names.

The issue of entitlement to a particular domain name is further complicated by the world-wide nature of the Internet. Marks may be registered by different parties in a variety of countries, but only one domain name is feasible If we defer to trademark law, what country's registration should prevail in the absence of any international conventions?

In an unsuccessful attempt to remove itself from domain name controversies, the NSI has incorporated indemnity requirements into its registration policy and adopted certain guidelines for domain name registration. In addition, the NSI has tried to recognize the superiority of registered US. trade and service marks.

Under the revised NSI policy issued late last year, the NSI will suspend a domain name issued to a party without a trademark if challenged by a party with a competing registered U.S. federal trade or service mark. The suspension or "hold" lasts until resolution of the domain name dispute.

If two parties both have registered marks, first-come, first serve prevails so long as the holder of the domain name posts an indemnity bond with the NSI (unless and arbitrator or court orders otherwise). In the absence of an indemnity bond, the NSI will suspend use of the domain name until the dispute is resolved.

The NSI policy only recognizes registered federal trade and service marks. Marks registered under state law or common law rights will not trigger suspension of the name without a court or administrative order.

While there are numerous cases of parties with the same trademark fighting over the same name, and despite NSI efforts to restrict issuance to legitimate users, domain name disputes with scavengers and others rage on. Many parties are simply purchasing domain names to avoid the cost of litigation.

Given the NSI focus on identical domain names, clients are well advised to pursue domain name registration and federal trademarks of desirable domain names. The U.S. Patent and Trademark office recently adopted a policy statement with classifications for domain names used to identify on-line information services to facilitate the process.

Unfortunately, many have lost the race to the domain name registrar before they knew it even started.