The texts below were filed a little over a year ago, and on this date of April 14, 1999, I not only find them as applicable today as they were when written, I have added two notes below that point even further to their truth. Bill Lovell Comments on Discussion Draft on Technical Management of Internet Domain Names Submitted by William S. Lovell, Attorney at Law [EMAIL PROTECTED] <> http://cerebalaw.com This comment is directed towards the trademark aspects of the �PROPOSAL TO IMPROVE TECHNICAL MANAGEMENT OF INTERNET NAMES AND ADDRESSES,� as promulgated by the National Telecommunications and Information Administration (NTIA) in its DISCUSSION DRAFT of Jan. 30, 1998. It is immediately obvious that little if any thought has been given in this PROPOSAL to the real content of that law. Some basic principles of trademark law have been set out by Dratler, Jr. (Law Journal Seminars Press, New York, New York, 1997).: (1) The foremost policy of trademark protection is avoiding public confusion. If two producers identify similar but different goods or services with similar trademarks, the public may be confused as to which is which. Consumers may buy one producer�s goods or services, thinking they are the other, and may be disappointed. Avoiding this sort of confusion is the primary goal of trademark protection. (2) So expressed, the primary goal of trademark protection seems to be a negative one � preventing undesirable confusion. This negative goal, however, has its positive side, which is a second purpose of trademark protection: encouraging competition. Trademarks provide consumers with shorthand means of identifying goods and services, their qualities and characteristics, and those who produce or sponsor them. (3) The third policy underlying trademark law is common to the law of trade secrets � advancement of commercial ethics. Particularly in its common- law incarnation, trademark law seeks to prohibit fraudulent representations by producers, including passing off of one�s goods and services as another�s. Two more trademark principles should also be noted, the first of which again derives from Dratler, Jr. as follows: Unlike most other branches of intellectual property law, trademark law is not designed primarily to encourage innovation. Instead it seeks to promote fair and robust competition by fostering accurate, shorthand identification of the source and quality of goods and services in the marketplace. (Emphasis added, footnotes deleted.) The second of these principles derives from practice before the U. S. Patent and Trademark Office (�PTO�), in the processes that Examiners carry out in the registration of a trademark: �Section 18 of the Lanham Act was amended, . . . , to expressly provide the Trademark Trial and Appeal Board with the authority to limit, or otherwise modify, the goods or services [described] in a [PTO] registration or application. One purpose behind this authority was to permit the Board to base determinations of likelihood of confusion upon marketplace realities, rather than hypothetical facts.� In order to ensure that such �marketplace realities� are in fact known to the PTO, certain requirements are imposed upon applicants for trademark registration, which may be summarized as follows: (1) �The presumption of an exclusive right to use a registered mark [in accordance with 15 U.S.C. �1057(b)] extends only to the goods and services noted in a registration certificate.� The Trustees of Columbia University in the City of New York v. Columbia/ HCA Healthcare Corp., 964 F. Supp., 733, 743 , 43 USPQ2d 1083, 1090 (DC S NY 1997), citing Arrow Fastener Co. Inc. v. Stanley Works, 59 F3rd 384, 397 (2nd Cir. 1995). (2) It is only as to the goods and/or services for which application has actually been made, and which would then be listed on a registration certificate if allowed, that the Patent and Trademark Office has made any evaluation as to the registrability of the mark. (3) �[A] mark may not be expanded beyond the good or service for which it was originally designated.� Park �N� Fly v. Dollar Park and Fly, Inc., 469 U. S. 189, 204, 105 S. Ct. 658, 667, 224 USPQ 327, 333 (Sup Ct, 1985). The most basic principle, however, is that which forms the basis for the statement noted above that �[u]nlike most other branches of intellectual property law trademark law is not designed primarily to encourage innovation.� The reason for that difference derives from the fact that such other branches of intellectual property law as patents and copyrights have a constitutional basis, while trademark law does not. Trademark protection thus does not rest on principles of property rights but rather on those of fair competition. Issues of how the trademark system really functions, and how specific trademarks and/or service marks are used by the �owners� thereof, thus become critical. Although the �good will� that a trademark may symbolize can be owned, the mark itself does not constitute such �property,� and if there is conflict between the public interest and trademark �rights,� then the latter must yield. Even given the presumptions of 15 U.S.C. �1057(b) noted above, the Lanham Act encompasses trademarks whether they or not are registered. All legitimate marks are entitled to protection, where �protection� means that others will not be allowed to infringe that mark, but since infringement rests on the issue of likelihood of confusion, it is necessary to pass that threshold before the advantages of having had a trademark registered can even arise. The PROPOSAL simply ignores these trademark fundamentals, and thereby perpetuates the same lack of understanding of the role and scope of the Lanham Act as had been imagined by the National Science Foundation (NSF) by way of Network Solutions, Inc. (NSI), which then leads to the same situation as was created by NSF/NSI that has plagued Internet domain name holders from the outset. No one seems to have bothered to research the relevant trademark law, but both NSF/NSI and the authors of this PROPOSAL have instead created an entirely extra-legal playing field that is slanted precipitously to the benefit of the owner of a registered trademark. As a consequence, it matters not what formal procedures may be laid out: they will have no credibility since they lie outside of the law. Indeed, the PROPOSAL gives the distinct impression that the community of registered trademark owners has already laid out its path in the language �where a trademark is unlawfully used as a domain name, consumers may be misled about the source of the product or service offered on the Internet, and trademark owners may not be able to protect their rights without very expensive litigation.� The remark explicitly ignores the fact that entirely law abiding domain name registrants may similarly be drawn into very expensive litigation to protect their rights, and these may be the parties who are least able to afford such litigation and are thus especially vulnerable to corporate bullying. The remark not only perpetuates the class warfare that was initiated by NSF/NSI but has already announced the winners. The erroneous presumptions implicit in the remark are that (a) between the domain name and the mark there exists an actual likelihood of confusion whereby the domain name registration becomes �unlawful� ipso facto; and (2) if there is indeed a real trademark dispute, the owner of a registered mark must necessarily prevail. Neither of these need be the case. [Added note: See Interstellar Starship Services v. Epix, Inc., although that was an "invented" trademark case.] Another erroneous presumption lies in the proposed means of resolving disputes: �[a] swift dispute resolution process could provide for the temporary suspension of a domain name registration if an adversely affected trademark holder objects within a short time, e.g., 30 days, of the initial registration.� Given that at this stage no process of law has yet shown that the owner of the domain name registration is infringing on anything or is acting contrary to any law, it is both a violation of due process and an overreaching of an administrative body into matters reserved to the Congress and the Courts for NTIA to adopt such a procedure � it would alter in significant ways the functioning of the Lanham Act. (Although it is now well settled that NSI has wisely shunned any involvement in trademark law, one would hope that the NTIA would first have examined the scope of its authority in this field.) [Note: the interjection by NSI of itself into trademark matters has of course expanded since this was written.] Moreover, through this PROPOSAL the NTIA might well be setting out to gain for itself a term of permanent residence in the Federal courts. It is not difficult to imagine why NSI adopted its policy of placing holds on domain names when confronted with a registered trademark: given the popular myth that registration of a trademark by itself conveys substantive rather than merely procedural rights, due discretion would suggest giving deference to the presumably monied owners of registered trademarks. Given the law as it is now established, on the other hand, it would appear that NSI need no longer worry about being sued by every other owner of a registered trademark. That scene would seem to change dramatically, however, if an entity such as NTIA or the private corporation it proposes to establish actually volunteers itself as an arbiter of trademark rights on the Internet, and presumes to adjudicate matters over which it has no actual authority. In the law, those who undertake to do such as that are known as �officious intermeddlers,� and by so intermeddling in trademark law NTIA may well be biting off a whole lot more than it will care to chew. Publication in the Federal Register does not a law make -- only Congress can do that � so the primary objection to this proposal as to trademarks boils down to the fact that it is simply illegal: the statutory authority of the NTIA does not extend nearly so far. So what is the solution? Two parties claim the right to use a name, one as a trademark or service mark for which a registration has issued, and the other as a domain name on the Internet (which role can also be a trademark or service mark usage � it is through such usage �in commerce� that trademark rights are established). Without any determination yet as to whether or not such a dual usage would bring about confusion in the marketplace as to the source of the goods or services, under Constitutional principles of equal protection both parties stand on an equal footing. If no likelihood of confusion can be shown, then the domain name owner should prevail, without regard to the status of the registered trademark or the procedural presumptions pertinent thereto. If likelihood of confusion were shown in court, then that court could look at dates and geographic regions and the like and decide who should prevail. But these matters fall within the province of Congress and the courts, not NSF, NSI, NTIA, or any other public or private entity that is not competent to determine questions of likelihood of confusion, let alone empowered to adjudicate or amend the time-honored trademark laws of the United States. [Note added: And especially WIPO.] NTIA or the private corporation that it proposes to establish can set up whatever system for allocating domain names as may be appropriate; however, once a domain name has been duly registered, either entity would be ill advised to violate the contracts under which those registrations will be made unless ordered so to do by a court of competent jurisdiction. In addition, any attempt again to require prospective registrants to enter into the kind of �contract of adhesion� that was adopted in NSF/NSI policies and that permitted such intermeddling might well be met this time around with massive resistance through a Class Action in the Federal courts. Since a domain name is individually selected, bought and paid for, it would seem to qualify as �property� in a way that a trademark never can, hence the legal theory behind such a suit would not be far to seek: under the proposed procedures there would be a �governmental taking� of private property for which full compensation would be constitutionally required. It is doubtful that NTIA wants to enter into that bed of thorns. Valuable suggestions concerning this comment were received from Attorney Savoy Rose Jade and are hereby acknowledged. However, the author listed below assumes full responsibility for the content of this comment. William S. Lovell, Attorney at Law Cerebalaw [EMAIL PROTECTED] http://cerebalaw.com The following additional comments are made to the Proposal �Improvement of Technical Management of Internet Names and Addresses� and relate to the trademark matters that I discussed in my Comment of March 6, 1998. I suggest that means for resolving conflicts between registered trademarks and registered domain names already exist within a sister agency of the Department of Commerce, namely, the Patent and Trademark Office (PTO). Inasmuch as �trademarks� and �service marks� are subject to protection under the Lanham Act whether or not they are registered, a mechanism is necessary by which it can be determined whether the registered mark or the domain name (assuming it is being used in a trademark sense, and hence qualifies as a presumably unregistered mark) actually has priority of use, which is the only way in which trademark rights are gained. 37 CFR Sec. 2.91, although hitherto rarely used, nevertheless provides a mechanism for declaring an interference between competing marks � a process in which the PTO has had long experience. The only change required in the law would be to amend 37 CFR Sec. 2.91 to allow an interference to be declared between a registered mark and a domain name. Since the PTO (unlike the NTIA) already has the statutory authority to decide trademark issues, it would be competent to establish such an amendment in its regulations. The mechanism to be used by the NTIA (or by the nonprofit corporation to be formed), upon receipt of a communication from the owner of a registered trademark who was seeking a domain name already held, would be to write back essentially as follows: �(1) The NTIA (or the nonprofit corporation) is not authorized to decide issues of trademark rights, nor does it have the authority to remove from a domain name owner a domain name registration lawfully obtained. However, (2) you are free to petition the Patent and Trademark Office for the declaration of an interference, and upon any decision by the PTO that your rights to the name in question were superior to those of the party presently holding that domain name, then this agency would be allowed to proceed as you request. On the other hand, if the PTO should decide that the owner of the domain name has priority, or that there is no likelihood of confusion in any event because different goods or services are involved or the like, then we shall be obliged to continue to recognize the existing domain name registration.� I hope that this suggestion may be useful. Sincerely, William S. Lovell [EMAIL PROTECTED] http://cerebalaw.com
