Law 227: Trademarks &
Unfair Competition
Internet Domain Names
July 16, 2009
Jefferson Scher
TM & Unfair Comp — Day 13
Agenda
• Internet Domain Names
What are they, trademark registration
Special remedies for “cybersquatting”
Federal Anti-cybersquatting Consumer
Protection Act (ACPA, Lanham Act §43(d))
Arbitration under the UDRP
Considerations in domain name deals
Trademarks in Cyberspace
Conceptualizing Virtual Reality
• What analogies should we use for
applying TM law to web sites?
Brochures / promotional materials
Magazines or other protected speech
Broadcast media (radio, television)
Retail stores
Theme parks
Trademarks in Cyberspace
Domain Names
• The Domain Name System (DNS)
A system for converting unique host
names into unique numeric addresses
Root servers contain entries for the Top
Level Domains (TLDs) such as .com,
indicating the server to ask for the
address of the Second Level Domain
(SLD), and so on, and so on
Yahoo example
Trademarks in Cyberspace
Domain Names — Registration as Marks
• What part(s) of a web address could
be protectable in these examples?
http://www.nytimes.com/
http://www.pets.com/
http://www.pets.com/
http://geoclock.home.att.net/
www.geocities.com/scrumpyshangout
• Does it depend on other usage?
Trademarks in Cyberspace
Domain Names — ACPA
• Elements under §43(d)
Defendant registers, traffics in, or uses a
domain name identical or confusingly
similar to (or dilutive of) a mark distinctive
(famous) at the time the domain was
registered — regardless of goods; and
Defendant has a bad faith intent to
profit from the mark
Trademarks in Cyberspace
Domain Names — ACPA
• Sample Bad Faith Cases
Sporty’s Farm v. Sportsman’s Market
Lucas Nursery v. Grosse
Coca-Cola v. Purdy
• Sample Safe Harbor Cases
Utah Lighthouse Ministry v. FAIR
Virtual Works v. Volkswagen
Trademarks in Cyberspace
Domain Names — ACPA
• Trafficking by non-owners
Ford v. GreatDomains.com
Vulcan Golf v. Google
• In rem jurisdiction
Harrods v. Sixty Internet Domain Names
Cable News Network v. CNNews
Heathmont v. Technodome
Trademarks in Cyberspace
Domain Names — Lanham Act/ACPA
• First Amendment Cases
Planned Parenthood v. Bucci
Jews for Jesus v. Brodsky
Lamparello v. Falwell
PETA v. Doughney
Trademarks in Cyberspace
Domain Names — UDRP
• UDRP test for cybersquatting
Domain name is identical or confusingly
similar to complainant’s mark;
Domain holder has no rights or
legitimate interests in the domain name;
The domain name has been registered
and is being used in bad faith.
Mark owner has burden of proof on all 3
Trademarks in Cyberspace
Domain Names — UDRP
• Sample UDRP decisions
Dial-A-Mattress v. Moakley
Compare: Phone number cases
Estate of Frank Gorshin v. Martin
Fields for Senate v. Toddles
Orange Bowl Committee v. Front &
Center Tickets
Trademarks in Cyberspace
Domain Names — UDRP
• “Sucks” domains
Direct Line Group v. Purge I.T.
So. Cal. Regional Rail Auth. v. Arkow
• Reverse domain name hijacking
Deutsche Welle v. DiamondWare
Plan.net v. Yikilmaz
Trademarks in Cyberspace
Domain Names — UDRP
• Appeal: UDRP meets ACPA
Sallen v. Corinthians
Dluhos v. Strasberg
Barcelona.com v. City of Barcelona
Trademarks in Cyberspace
Domain Name Acquisitions
• Parallels with trademarks
Unique text string identifying a point in
cyberspace, or family of related hosts
Arguably inherently “source” identifying,
even if the USPTO doesn’t see it that way
Can function as a mark if used as a mark
Like “trade dress” and nontraditional marks
(such as sound and scent)
Trademarks in Cyberspace
Domain Name Acquisitions
• Differences from trademarks
Ownership not tied to use or registration
“Name service” is:
What makes a domain name function
Revocable in the event of a TM challenge or
breach of contract by the registrant
Vulnerable to power outages, cracking, poor
service, and registrar’s financial collapse
Trademarks in Cyberspace
Domain Name Acquisitions
• Key issues
Acquiring TM rights in the domain
Whether / how to reference goodwill in the
domain name (as though it were a mark)
Documentary evidence of “use” as a TM
Assurances of assistance in enforcing the
rights acquired
Willingness / ability to testify; credibility
Trademarks in Cyberspace
Domain Name Acquisitions
• Key issues, cont’d
Representations and warranties of
ownership and noninfringement
Ability to indemnify buyer
Seller’s non-use / non-registration of
similar domain names, trademarks, and
business names in the future
Of course, price
Trademarks in Cyberspace
Domain Name Acquisitions
• Pricing
Buyer’s side — setting priorities
Getting the right price vs. getting it right
now (or at at all)
Acquiring “trademark” rights
vs. just a domain name
Airtight agreement
vs. quick ’n dirty
Trademarks in Cyberspace
Domain Name Acquisitions
• Pricing, cont’d
Market factors
Buyer’s need/availability of alternatives
Seller’s investment/sophistication
(Likely) Interest of others
– General interest: value at auction to the public
at large (inherent attractiveness of the name)
– Special interest: similarity to names and mark
used by others (brand extension value)
Trademarks in Cyberspace
• Pricing, cont’d
Role of legal leverage
Likelihood of success
Cost
Domain Name Acquisitions
Leverage
– Using UDRP, potential speedy transfer
– In court, potential monetary remedies
Ability to impose process costs
– Need to hire attorney, respond to discovery
Willingness to follow through
Trademarks in Cyberspace
Domain Name Acquisitions
• Non-cash (in kind) consideration
Products of buyer
Computer hardware, software licenses, etc.
Other
Joint promotion on buyer’s site
Free advertising on buyer’s site
Internet access/web hosting/e-mail under
the transferred domain or a subdomain
Trademarks in Cyberspace
Domain Name Acquisitions
• Negotiation postures for buyer
Legal (demand letter, UDRP, lawsuit)
Requires leverage for credibility
Factor in legal fees and costs
“Business” approaches:
casual/friendly vs. strong
“Confidential” inquiry/purchase
(through counsel or investigation firm)
Trademarks in Cyberspace
Domain Name Acquisitions
• What if you want to sell? Hmmm…
Auction/resale sites
Easy to use, but
– Public might not place a high value on the name
– Potential buyers might be nervous re TM rights
Targeting those with special interest
Pinging IP owners who didn’t seek you out
may set you up for cybersquatting liability
Trademarks in Cyberspace
Domain Name Acquisitions
• Agreement structures
“Bill of Sale”-style short form
Just goods and consideration — and the
goodwill if you want to acquire TM rights
Settlement Agreement style
Deal with the potential for future litigation
Tightly tie the seller’s hands
“Friendly” agreement takes longer to draft
Trademarks in Cyberspace
Domain Name Acquisitions
• Payment terms — favorable to buyer
Best: after transfer; no payment if the
transfer fails due to no fault of buyer
Fallback: funds held in trusted “escrow”
pending the transfer; no payment if the
transfer fails due to no fault of buyer
Worst: payment in advance, refunded if
the transfer fails for any reason
Trademarks in Cyberspace
Domain Name Acquisitions
• Terms the seller might prefer
Payment in advance, no refunds if the
transfer should fail for any reason
No promises/warranties about ownership
or past use of the domain
No obligations to assist buyer in the
future with domain or TM issues
Trademarks in Cyberspace
Domain Name Acquisitions
• More terms the seller might prefer
No restrictions on future business or
domain names, or future marks
Long term e-mail forwarding (under
NDA), and a link on buyer’s web site to
seller’s new location
Full release of trademark claims, and
indemnification for buyer’s future use
Trademarks in Cyberspace
Domain Name Acquisitions
• Post-agreement logistics
Idiosyncratic registrar procedures
At one extreme: notarized signatures and
photocopies of picture IDs
At the other: online transfer with a
password (and/or telephone confirmation)
Trademark assignment recordation
Policing future names and domains
TM & Unfair Comp — Up Next
Topics and Reading for Day 14
• Advertising Issues
Ch. 8, pp. 556-568
Ch. 6, pp. 417-433; Supp. pp. 46-49
Ch. 6, pp. 370-394, Supp. pp. 42-46
• Review (student-driven)
Your questions on specific topics
Your questions on past exams