Here is the text of a message I attempted to post to [EMAIL PROTECTED] . I have posted it to the GA list, but in deference to their no-cross-posts policy I am sending it separately to IFWP & Domain-Policy. Personally I find cross-posts easier to filter, but go figure. -- A. Michael Froomkin | Professor of Law | [EMAIL PROTECTED] U. Miami School of Law, P.O. Box 248087, Coral Gables, FL 33124 USA +1 (305) 284-4285 | +1 (305) 284-6506 (fax) | http://www.law.tm --> It's hot here. <-- ---------- Forwarded message ---------- Date: Wed, 14 Jul 1999 14:12:00 -0400 (EDT) From: Michael Froomkin - U.Miami School of Law <[EMAIL PROTECTED]> To: [EMAIL PROTECTED] Subject: Why the WIPO report is wrong about famous marks (I-Substance) As explained in my wipo commentary, http://www.law.miami.edu/~amf/commentary.htm, there are several different types of problems with the WIPO proposal on famous marks. This message concentrates on substantive issues. The next message will focus on procedural issues. [the following is a quote from paras 91-106 of my commentary] WIPO proposes that a centralized tribunal be impaneled that would rule on ex parte applications by trademark owners that their mark was sufficiently famous to be declared globally famous. This entire project described in Chapter Four of the Final Report is at best premature. While many nations have, consistent with their treaty obligations and national law, developed standards for identifying nationally famous and/or sectorally well-known marks there is no consensus procedure for identifying globally famous or globally well-known marks. Furthermore, any mark which is globally famous or well-known will also be nationally famous or well-known in most nations. As such it already benefits from existing, substantial, protections under national law and is therefore already quite well protected, by the courts-and by the WIPO-ADR procedures when they follow national law. World-wide there probably are already at least tens of thousands of identified nationally or regionally famous and well-known marks. As the procedures for identifying these marks become more routinized and widespread there are potentially hundreds of thousands, or even millions, on a world-wide basis. WIPO does not (as indeed it should not) propose to give special gTLD protection to each of the many nationally famous and well-known marks, but rather to create a new category of globally famous and well-known marks. However, it appears that no one-WIPO included-has any idea how many marks this would be. In the Interim Report WIPO suggested that only "a small number of names is involved...it is likely that famous and well-known marks that may qualify ... number in the hundreds, rather than the thousands." RFC 3, para. 216. Interestingly, no estimate is provided in the Final Report. The job of trying to find appropriate and definite criteria is a thankless one, as the inability of the Committee to come up with something better demonstrates. WIPO rightly rejected mechanistic criteria such as the number of countries in which a mark is registered, as these too are manipulable, and they also fail to measure whether a mark has the global fame of exceedingly common names such as "Coca-cola." Unfortunately, rather than recognize that the task is perhaps impossible, but certainly not yet possible, WIPO pressed on. There are several conceptual problems with WIPO's proposal: 1. The "exclusion" protection for certified famous marks provides marks owners with rights not currently found in law, notably the right to block non-infringing uses of the name they have trademarked; 2. The criteria WIPO proposes be used for identifying which marks are sufficiently famous to enjoy enhanced protection are vague, and in one appears to require evidence whose prejudicial effect will outweigh any probative value (as WIPO argues ADR is needed because cybersquatting affects many trademark holders, making being the subject of cybersquatting an indication of global famousness seems especially odd.); 3. No one has any idea how many marks will qualify. Not only is there no upper limit, WIPO has now retreated from its low estimate in the Interim Report; 4. The proposed "evidentiary presumption" applies far too broadly, and is in any case an inappropriate remedy. Problem: Provides rights not found at law. The protections proposed for famous marks exceed those currently available at law, thus violating the fundamental aim stated in the Final Report that "the goal of this WIPO Process is not to create new rights of intellectual property, nor to accord greater protection to intellectual property in cyberspace than that which exists elsewhere." Final Report, paragraph 34. As WIPO itself notes, "the provisions of the Paris Conventions and the TRIPS Agreement are directed at the protection of famous and well-known marks against the registration or use of other infringing marks. Domain names, of course, are not the same thing as marks and are used for many purposes other than the identification of a producer or seller of goods or services." Final Report, paragraph 258. WIPO is to be commended for its honesty in noting that these international treaties do not create a right to prevent registration of domain names. This, however, leaves the question of where that right comes from. Once a mark is identified as famous, the proposed remedies and benefits are over-broad, as they block non-commercial uses of the same name, and hard to understand (and, it appears, over-broad), as applied to the multiplicity of similar names. WIPO proposes two types of benefits to globally famous marks. The "exclusion" would automatically block the registration of a domain identical to the trademark in any new gTLD. This exclusion fails to reflect the fact that the international consensus on the protection of famous and well-known marks extends only to protection against commercial use of those marks. Whatever protection these marks are entitled to under treaty extends only to protection against others making commercial use of the mark. Similarly, although the laws of many nations provide protection against dilution of a trademark this too can require commercial use, albeit not necessarily a showing of likely customer confusion. For example, the U.S. federal Trademark Dilution Act specifically excludes non-commercial use of a mark from its coverage. 15 U.S.C. § 1125(c)(4)(B). Thus, in Lockheed Martin Corporation v. Network Solutions, the court stated, "in Panavision and Intermatic, the fact that the defendant's conduct impeded plaintiff's use of its trademark as a domain name was not the determining factor in finding that the defendant's use was diluting. If impeding use of the trademark as a domain name were the only factor, the court in Panavision would not have asserted that registration of a trademark 'as a domain name, without more, is not a commercial use of the trademark and therefore not within the prohibitions of the Act.' Panavision, 945 F. Supp. at 1303. All prior domain name registrations corresponding to words in a trademark impede the trademark owner's use of the same words for use as a domain name. The Internet, however, is not exclusively a medium of commerce. The non-commercial use of a domain name that impedes a trademark owner's use of that domain name does not constitute dilution." 985 F. Supp. 949, 959-60 (C.D. Cal. 1997). As the court noted, "Internet users may also have a free speech interest in non-infringing uses of domain names that are similar or identical to trademarks." Id. at 964 n. 9.176. Since a registration of even a famous mark is not, without some commercial use, necessarily infringing, it is unreasonable to give even globally famous marks a blank pre-emptive right blocking registrations in all gTLDs WIPO makes two arguments for extending the protection of famous marks beyond what is currently available in law. The first argument need not detain us long. Famous marks, WIPO argues, deserve something extra in the DNS because they have extra rights in national law, "The administrative procedure is, however, rightly available to all and does not give expression to the separate international protection that already exists for famous and well-known marks", Final Report, paragraph 262; an exclusion mechanism is justified because "it seems correct in principle that famous and well-known marks are recognized in international law as being subject to special protection," id., paragraph 263. Rather than "extend such protection," the exclusion will "give expression to it in the DNS". Since it is already conceded that this extra protection does not derive from the Paris Convention or TRIPS, it can only derive from national law; as such the appropriate level of protection will be applied when judges and arbitrators decide specific cases. In any event, WIPO's argument misses the point. The issue is not how to replicate the relative degrees of protection given to different types of trademarks. The issue is how to craft processes that provide trademark owners who have legal rights that are cheap to violate in the DNS, but expensive to vindicate in the courts, with a cheap, fast, fair means of enforcing their rights-without going overboard and violating some other rights in the process. The WIPO-ADR already does this. WIPO's second argument is more practical than legal: "We also consider that it could be highly economically wasteful, in view of the experience in the existing open gTLDs over the past five years, to add new open gTLDs without any safeguard against the grabbing or the squatting of famous and well-known marks by unauthorized parties in those new open gTLDs." This argument is not persuasive, either on its own terms, or in light of WIPO's consistently-repeated promise that its objective was to replicate existing legal relations, not expand the rights of intellectual property owners. It is not the law, in the US at least, that one commits an actionable wrong against even a famous trademark by making many non-commercial use of it. Thus, an exclusion which works to prevent critics of a corporation from registering its name in a new gTLD for the purpose of critiquing it gives that company an advantage not justified by law (and thus violating WIPO's own terms of reference for itself). That said, there is clearly a good argument for some transitional rule to cover the first micro-seconds or days when certain new gTLDs are opened up. Such a rule would address the competing interests of the multiple possible trademark holders as well as non-trademark holders with a legitimate interest in a given domain name. But the need for a rule to prevent (or mediate) a short-lived stampede should not be leveraged into a rule that creates a permanent preference of unlimited scope. Nor is it clear why the same rule would apply to, say, a non-commercial gTLD. WIPO itself has had an international working group seeking to identify criteria for world-famous marks for several years. See Final Report, para. 284. This group has failed to produce either a list of world-famous marks or a set of definitive criteria for identifying such a mark. See id. As WIPO accepts the general principle that "the goal of this WIPO Process is not to create new rights of intellectual property, nor to accord greater protection to intellectual property in cyberspace than that which exists elsewhere," Final Report, paragraph 34, it seems most in keeping with this principle to wait until the bodies already charged with finding definitive criteria for all purposes do so. Problem: No Upper Limit The ad hoc procedures WIPO proposes to create have no structural incentive for keeping the number of specially privileged marks within reasonable bounds. Put simply, the participants in WIPO's proposed process have no incentive to say "no" to anyone claiming that his mark is famous or well-known. The consequence for the DNS could be a substantial erosion of the available namespace as an increasing number of names, including common words, are reserved and made unavailable in every gTLD. WIPO responds that the "best safeguard" against this fear is "discipline and rigor in relation to the criteria for assessment of entitlement to an exclusion," Final Report, paragraph 274, but it offers no explanation of how this is to be achieved. If it cannot scrap the entire idea, ICANN needs to set an upper bound for the number of marks that could benefit from the process. Once such a ceiling was in place, the decision-makers would have an incentive to be cautious about whether marks are sufficiently famous to qualify, for fear that over-liberality in the initial decisions would leave out more deserving marks whose owners were slower to request certification. An initial ceiling could be 500, 1000, or even more, trademarks. Since any initial number is arbitrary, the ceiling could be subject to review (up or down) by ICANN or some other neutral body every five or ten years. WIPO explains its opposition to an upper limit in terms that reveal just how necessary a limit will be: "We consider that a quota could operate in an entirely arbitrary manner. The selection of the level of the quota would, for a start, be arbitrary. The level could work arbitrarily against marks which become suddenly famous, whose owners might be prejudiced by the previous filling of the quota." Final Report, paragraph 269. With these words, WIPO admits that there is no quota it can propose that would be large enough, and that whatever the quota is agreed, WIPO fears that the process it proposes would fill it. This alone should be conclusive evidence that the proposal for certifying globally famous names is fatally flawed. (Recall that in the Interim Report WIPO suggested only "hundreds" of trademarks would qualify; now it makes no estimate.) The claim that a quota would be arbitrary is persuasive only if the quota is set so low that it gets used up. If it is the case that WIPO's criteria will be applied with 'discipline and rigor' then it should be possible to find a quota high enough not to cause arbitrary results and yet low enough to reassure the Internet community that the mechanism will not be abused.. The suggestion that a quota would work to unfairly disadvantage a suddenly famous mark like Viagra that was a late arrival on the scene, see Final Report paragraph 269, can be met either by setting the right quota, or by setting a quota with a warning zone. Suppose, for example, that the quota were set at 1000 trademarks, with the understanding that if the panels actually allocate the entire quota, they can have another 100 so long as the criteria for granting certifications of sufficient famousness were officially revised to make granting certification more difficult. In this scenario there would never be a moment in which there were literally not more certifications available. The disadvantages would be that were the criteria ever tightened this would in effect give a windfall to successful early applicants who would not have met the tightened criteria. As a result a "flexible" ceiling system (and indeed, a low and inflexible ceiling also) might lead to a flood of applications at an early stage. Encouraging early applications may not be all bad, however, as it will give the decision-makers a better sense of the marks against which they should weigh each applicant. -- A. Michael Froomkin | Professor of Law | [EMAIL PROTECTED] U. Miami School of Law, P.O. Box 248087, Coral Gables, FL 33124 USA +1 (305) 284-4285 | +1 (305) 284-6506 (fax) | http://www.law.tm --> It's hot here. <--
[IFWP] Why the WIPO report is wrong about famous marks (I-Substance) (fwd)
Michael Froomkin - U.Miami School of Law Thu, 15 Jul 1999 07:31:05 -0700
