The expanded usage of the Internet for commercial purposes has resulted in greater importance and significance of name recognition on the Internet. An identifying address on the Internet, the "domain name", creates an expectation about who and what is located at that address. Because a domain name may suggest identity, quality and content, it may be closely related to or function as a trademark.

The Internet domain name registration policy of first come/first served has resulted in hundreds of controversies surrounding ownership of a particular name, including a number of well-known instances where individuals have registered names based on a corporation's trademark or where corporations have registered names based upon a competitor's trademark. This article focuses on the expanded commercial use of the Internet, conflicts between trademarks and domain names on the Internet, and the policies currently in place to resolve such conflicts.


What is the Internet?

The Internet is a global network consisting of individual government, educational, military, corporate, and local computer networks. This "network of networks" connects local systems to regional systems to national systems to international systems through technical protocols that insure the interoperability of all the networks.

Internet usage is decentralized from a technical and management standpoint; each computer acts autonomously and is responsible only to its own systems administrator. There is no central authority from which an individual/entity obtains permission to join a network, or to which an individual/entity can complain if things go wrong.


Communication on the Internet

Communication on the Internet requires each computer and user to be distinguished in some manner. Network Solutions, Inc. ("NSI"), a private company that also is referred to as InterNIC, provides each identifying address. NSI also is responsible for the registration of each domain name.

The heirarchy of domain names is illustrated by the following example: "rjones@gm.com". The first heirarchy level, located to the far right, is a standardized abbreviation representing the type of entity and it is the top-level domain name (such as ".com" for commercial entities, ".edu" for educational institutions, and ".gov" for government entities. The second level, directly to the left of the type of entity, "gm," is a unique domain name. NSI will register this name; once registered, it cannot be registered by another party. The third level, located to the far left, is the "user name". Therefore,"rjones@gm.com" identifies Richard Jones, located at General Motors, a commercial entity.


Commercial Use of the Internet

Numerous factors have fostered the commercial potential and increased commercial use of the Internet. (1) the development of World Wide Web ("WWW") technology that enables audiovisual material to be transmitted along with text; (2) the development of less-complicated browser software that permits non- technical users to locate and display information more easily; (3) the relaxation of restrictions upon commercial uses; (4) improved security measures that facilitate the completion of business the transactions over the Internet; and (5) the relatively inexpensive cost for a business to develop its own location on the WWW, known as a "home page" for advertising its products and services.


Trademarks and the Internet

NSI will register a domain name without any traditional trademark analysis regarding the registrant's rights to the domain name. Such registration, coupled with possible conflicts resulting from the world-wide nature of the Internet and the technical restrictions of domain names, have created problems for trademark owners because their marks may be taken by others on a first come/first served basis.

Controversy and confusion result especially where well-known trademarks have been registered by unrelated third parties for the purpose of re-selling them to the rightful owner or using them for their own purposes. Furthermore, the same second-level domain name can be assigned to ".com" and ".net"(that is, "ibm.com" and "ibm.net"), creating even more confusion and conflict.


The "New" NSI Registration Policy

NSI, in an attempt to reduce controversy and confusion and to forestall litigation, revised its domain name registration procedures in 1995. The new policy does not replace the first come/first served registration procedure, but instead places the burden on the applicant to act in good faith in obtaining a domain name. The applicant must warrant that the domain name it desires to register does not infringe the trademark of a third party.

Although NSI has stated that it will not make the final determination in a dispute concerning the use of a particular domain name -- this will be left to a court or arbitration panel -- it has established dispute resolution procedures. The essential terms of NSI's dispute resolution policy are as follows:

Where Do We Go From Here?

Even though NSI has established a dispute resolution policy, the particulars of the policy still require clarification and interpretation. Issues that remain unresolved include the following: (1) whether the trademark registration be the "exact" term as the domain name registration; (2) whether the goods and services that are set forth in the trademark registration important; (3) whether a U.S. trademark registration has any effect for the domain name registration of an identical name, but for different goods or services, in a foreign country; and (4) who is the rightful holder of a domain name for a well-known acronym such as "ABA" -- the American Bar Association or the American Banking Association?

Possible solutions that may help resolve some these problems include changing the domain name structure by establishing new top-level domains that (1) further identify the type of organization, such as ".corp" for corporation, or (2) have no particular significance, such as ".aaa" or ".xxx", or permit traditional trademark law to resolve the ownership and rights in a domain name in such a manner that it will preclude the likelihood of confusion. Meanwhile, NSI has recently found itself enmeshed in four law suits that involve NSI's dispute resolution policy. In each law suit NSI had notified a domain name registrant that it had to cease using their registered domain name in thirty days because it infringed a third-party registered trademark . In each case the domain name registrant sued to prevent the loss of its domain name.

To confuse matters further several states have initiatives that attempt to prevent the unauthorized electronic use of trademarks by imposing civil liability on any party who uses "another's registered trademark or trade name as a domain name, electronic mail address, or user identification," or criminal liability for the "transmission of misleading data over computer networks".

Conclusion

It will take some time before the domain name/trademark controversy is resolved as it concerns the Internet. The ultimate solution will undoubtedly require a domain name registration policy that better accommodates the economic realities of the marketplace.

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Lloyd L. Rich is an attorney practicing publishing and intellectual property law. He can be reached at 1163 Vine Street, Denver, CO 80206. Phone: (303) 388-0291; FAX: (303) 388-0477; E-Mail: rich@publishingattorney.com; Web Site: http://www.publishingattorney.com.