Comments of the Domain Name Rights Coalition

WIPO Internet Domain Name Process

March 19, 1999

To the Panel of Experts and Senior Attorneys with WIPO:

The Domain Name Rights Coalition thanks you for your time, energy and commitment on the issue of domain name/trademark conflicts and welcomes this opportunity to provide these written comments regarding the Interim Report, RFC-3.

Our comments will be in three parts, namely: concerns about RFC-3 recommendations, questions bout problems RFC-3 fails to address, a proposal for a new solution that allows fast and cheap resolution of cybersquatting disputes without creating new international law or favoring one segment of the Internet at the expense of others.

If there is additional information that DNRC can provide as part of your evaluation process later this month, we hope you will contact us.

Sincerely,

/s/ Kathryn A. Kleiman

General Counsel, Domain Name Rights Coalition

Kathryn A. Kleiman, Esq.

I. DNRC Concerns Regarding RFC-3

DNRC joins the chorus of individuals and organizations who believe that the proposals ofRFC-3 fundamentally change trademark law and create a system which favors large companies at the expense of individuals, not-for-profit organizations, small businesses and entrepreneurs in nearly every resolution of a domain name/trademark dispute.

Rather than providing you with a treatise on these issues, we will summarize our position with reference to the work of others. DNRC specifically endorses the each concern set forth by Panel of Experts member, Professor Michael Froomkin, in his scholarly and deeply troubling Critique of WIPO's RFC 3. We agree with Professor Froomkin's premises that the Internet is a stream of communication for all speakers, and that the implications of the WIPO proposals must be reviewed for all people. We have reviewed at length and in detail the concerns laid out by Professor Froomkin, and we endorse and agree with each and every one of his concerns.

Specifically, we point out that the scope of RFC-3 creates a "comprehensive scheme for alternate dispute revolution of almost every conceivable intellectual property dispute that might involve a domain name - including substantial non-trademark issues. "Comments of trademark attorneys, including Susan Anthony representing the International Trademark Association, at the Panel of Experts meeting on Wednesday, March 10thin Washington, DC ("March 10 Meeting),pointed out that they, also, do not want a comprehensive, "solve all IP problems" ADR panel. At the March 10 Meeting, both domain name and trademark owners issued a clear message for an untested online, cyberlaw ADR mechanism in cyberspace: go slow, be very narrowly focused in the scope and jurisdiction of the panel, and see how things work.

We share Professor Froomkin's concerns, and the concerns now being echoed by individuals such as Ellen Rony, entrepreneurs who have grown from small to large businesses on the Internet such as Michael Doughney, and academics with a perspective of history and technology that using control of the root servers force individuals to waive personal jurisdiction, to create a new international law for famous marks, and a new centralized point of control for claims based on website content are not in the best interest of the Internet and would badly hurt and chill the robust activity of individuals, small businesses and entrepreneurs, and community organizations.

Based on our participation in the March 10 Meeting, we believe that these concerns have been clearly and fully laid out and that you will clearly understand the scope of concerns that we share. We therefore focus in this section on three proposed solutions and, briefly, why they will not work.

1) The affidavit of Paragraph 53 will not solve the problem While the intent is to try to stop people from registering names which they clearly know do not belong to them (cybersquatters), the actual impact will be on innocent registrants. Cybersquatters will continue their registration activities regardless of this affidavit, and under the proposals below, they will be stopped regardless of their signature to this affidavit. What the affidavit makes impossible is the honest registration of a domain name by nearly everyone else.

. The affidavit raises a question that cannot be answered by the vast majority of individuals, small businesses, entrepreneurs and organizations. When does a domain name interfere with trademark? When does a domain name infringe on a trademark? Aside from the very clear cases of cybersquatting (in which cybersquatters consistently lose), cases involving domain names and trademark challenges are being decided both ways: sometimes words in domain names are found to be noncommercial use and protected, and sometimes words in domain names are found to be generic and open to use by all - even if there is a trademark for the same word! Also, many cases hold that mere registration of a domain name, without more, cannot be a violation of a trademark.

The proposed affidavit overrules this last set of cases and sets traps for innocent domain name registrants by making them sign something so vague and ambiguous that it can easily be used against them later. Further, it shifts the burden of knowing about existing marks and policing existing marks from the trademark owner (where trademark law puts it) to the domain name registrant. Guaranteeing third party rights is not the appropriate place for a domain name registration. Cybersquatters can be caught without asking all domain name registrants to sign onto to this affidavit which effectively creates law by equating domain names with trademarks.

2) Noncommercial gTLDs don't solve the problem. In the questions raised by WIPO Panel and Mr. Francis Gurry, we heard the question whether non-commercial gTLDs would solve the problems being raised concerning the RFC-3. DNRC strongly believes the answer is no.

Certainly noncommercial gTLDs are necessary, and DNRC was the first to call for .POL for political speech and .PER for personal speech several years ago in its comments to the International Ad Hoc Committee and later to the US Department of Commerce. These domains are clearly needed to provide a place for speakers whose last name coincides with names that are famous marks such as McDonald's, Stouffers and Disney, but the solution does not solve the problem.

The creation of noncommercial gTLDs which leave in place the proposals of RFC-3 for all commercial domains will create tremendous harm to small businesses and entrepreneurs. These companies have the right to use the full range of the dictionary and their imaginations to name their goods and identify their services. Current trademark law allows multiple companies to share common words, and even identical words; current trademark law protects words as generic for all to use (such as apple for apple growers) even while registering it as an arbitrary mark for others (such as Apple Computer); current trademark law allows marks to pass from protected into unprotected status through becoming generic or being abandoned. Expanding the intricacies and subtleties of trademark law protection for existing and entering entities is the subject of a new international treaty, not a new international domain name system. We are certain that rules can be worked out to protect small and large businesses, but the wholesale expansion of protection for famous marks or "well-known marks" (a category without legal precedent) is not the way to do it.

3. Exemption Systems are untimely.

For the reasons set out in the section above, the proposed "mechanism for exclusion of famous and well-known marks in open TLDS" ("Exemption System") is untimely and premature. Allowing a company to keep a non-coined, non-fanciful term from registration in all commercial domains will be to allow a level of commercial monopolization of basic dictionary words and surnames that is unequaled and unprecedented in the history of trademark law.

Such an exemption system also clearly equates a domain name with a trademark - in clear contradiction to the decisions of US and Canadian courts and the direction of US case law. Further, such a system creates a centralized control of domain names which we believe is inappropriate. Further, we believe the need for this exemption system is effectively eliminated by the fast and cheap review of cybersquatting allegations set in Section III below.

II Fair Treatment of All - What RFC-3 left out.

In the spirit of the White Paper, it is important to the development of Internet policy that all parties feel heard and recognized. Lacking in RFC-3 is a sense that the needs and concerns of the community outside of large trademark owners are being heard and considered. It is DNRC's strong request that the next document clearly expresses concerns for those who will be the targets of the domain name challenges.

Specifically, the next document must discuss reverse domain name hijacking. As Ellen Rony discussed in the March 10 Meeting, individuals with ".org" registrations for noncommercial websites under the names of themselves and their children have been the targets of trademark abuse and attempts at reverse domain name hijacking (e.g.,VERONICA.ORG,POKEY.ORG). The domain names of Internet businesses and small businesses are under attack good will and strong common law trademark because they do not have the federal registration.

These stories of trademark abuse and reverse domain name hijacking are covered by the press as frequently as cybersquatting. It is a problem which is costing small businesses and individuals resources, time, and ultimately their Internet addresses and Internet speech. It is a problem that the Panel of Experts must expressly acknowledge and discuss in the next document to claim to represent the Internet community and promote a consensus viewpoint.

II Is there a system that can protect against cybersquatting and domain name hijacking and still be fast and cheap?

As presented at the March 10 meeting, DNRC submits there is a way to solve the cybersquatting problem without creating new international law `or dramatically limiting the rights of non-trademark owners on the Internet: the creation of an online forum of limiting jurisdiction through the registrar paid for largely by a very small addition to each registration fee.

A. Overview

The dispute panels must have very limited jurisdiction: only domain name and trademark disputes for the purpose of identifying cyber squatters. These forums will not work and will not be accepted if they are designated to solve all intellectual property problems.

The dispute panels must have a very limited remedy: keeping or revoking domain names. Those wanting damages or other penalties should turn to the courts for this request.

The dispute panels must accept very limited pleadings: only "paper pleadings" in writing and (preferably) online. Those wanting discovery, witnesses and other court proceedings should turn to the court system.

The dispute panels must be balanced and knowledgeable. A balanced panel sitting in review of domain name/trademark disputes will increase public confidence in the process and outcome. To create this confidence and a sense of fair and balanced review, the panels should have five members: two pro-trademark attorneys, two pro-domain name attorneys and one specialist in arbitration/choice of laws. Each panelist should be well versed in trademark law, fair use of trademarks and limits of trademark law, litigation and evidence, and the functioning of the domain name system.

B. Pleadings

The dispute panel will work effectively only if the trademark owner is forced to meet a clear and defined standard. Because the trademark owner is effectively requesting a permanent injunction (removing a domain name from the registrant), he/she should have to show their entitlement to this domain name in his/her pleading. He/she must show that:

i) there is a trademark or service mark,

ii) that the domain name owner is using the domain name in commerce (an absolute criteria for proving infringement and also dilution under US law and many other laws) or engaged in the business of buying and selling brand name domain names without adding additional value (cybersquatting), and provide

iii) clear, specific allegations of how the domain name use is creating infringement or dilution, and if infringement, how the confusion is being caused. Unlike the vague and ambiguous language that NSI allows in their complaint letters, this forum must require that the challenger's pleadings be quite clear, specific and unambiguous on this point because the domain name process deserves it.

The domain name owner is then entitled to a response. He/she must provide a written showing that a) they are engaged in noncommercial activity or b) an explanation of why he/she believes he/she is entitled to use the word/words of the domain name in commercial activity. The domain name owner is entitled to show that there is no confusion or dilution created by his/her use of the mark.

The panel should evaluate the pleadings and evidence before it and decide upon a single issue: do they believe that the domain name owner has any legitimate rights to and uses for the domain name? Is the domain name owner engaged in the business of buying and selling domain names as a cybersquatter?

C.Additional issues

Adoption of the panels should be by the registrars. The registrars are the parties in the best position to adopt these dispute panels. We expect that the registrars will be in the same country or region as their customers, the domain name owners; we expect that they will operate these dispute panels in the local language and in accordance with local customs which will make the process approachable to challenger and defender alike.

However, we do not believe that the dispute panels should become a barrier to entry for small registrars. Instead, WIPO should encourage large registrars and existing registrars to allow newcomers to send disputes to their disputes panels for a period of time. Registrars should also be allowed to pool resources and share dispute panels on an ongoing basis.

The cost of the panels should be borne by both the domain name owners and the trademark challenger. DNRC believes it is appropriate to add a minimal fee (such as one dollar or its equivalent) onto the cost of each domain name registration. This money should be entered into a pool solely used to pay for the costs of domain name disputes. Having given the issue additional thought, we also believe it is appropriate to require the trademark owner to pay a fee for the challenge to assist in offsetting the administration costs. A fee of approximately $300-$500 (subject to local standards and incomes) will probably be appropriate and should be set by the registrar. Such a fee will ensure that both sides have an interest and financial commitment to the process and outcome.

DNRC is pleased to offer a system that allows large trademark owners to cost-effectively and quickly bring cybersquatting challenges, and that will not require any domain name owner to drop out due to failure to pay. We are also pleased that the system we proposed introduces no new laws and no new "guiding principles" of the Internet because the arbitrators must apply existing laws and traditional choice of law principles, as new laws and new guiding principles are properly the subject of international treaties of members countries this domain name process.

Thank you for your consideration of the proposal set forth in this comment.