House Judiciary Checks Out Cyber-Squatting

Internet domain name registration is getting plenty of attention these days, but it has been primarily focused on the Internet Corporation for Assigned Names and Numbers’ funding woes and its highly publicized dispute with domain name registrar Network Solutions. Wednesday, the House Judiciary Committee’s Subcommittee on Courts and Intellectual Property found a new reason to examine the Internet domain name controversy: “cyber-squatters.”

Copyright and trademark owners are up in arms over Web site owners’ unauthorized uses of their trademarks in domain names. While some of them are legitimate businesses that may not have known they were appropriating someone else’s trademark, others — so-called “cyber-squatters” — are accused of deliberately registering domain names using widely recognized trademarks. Such domain names are either used to attract visitors to the site or to force the trademark holders to buy the domain name in order to gain control over what content appears on the site.

Rapid Expansion Heightens Problem

The World Intellectual Property Organization estimates that the number of top-level public domain names — those ending in .com, .net, .org and .edu — has grown from about 100,000 in 1995 to about 7.2 million this spring. As the boom continues, Subcommittee Chairman Howard Coble (R-N.C.) argues, the need to gain control over the allocation of names and the protection of intellectual property rights has become more acute.

At the hearing, Coble questioned whether the federal government, some broader international organization, or the individual domain name registration companies should be responsible for protecting trademark holders from unwitting infringement and cyber-squatting. The panel, which did not include a representative of any company accused of squatting or inadvertently infringing someone else’s trademark, overwhelmingly agreed such domain name abusers must be stopped. They disagreed, however, on how to approach the problem.

The Department of Commerce, which commissioned ICANN to take the business of domain name registration into the private sector, “condemns cyber-squatting as a deceptive and unfair practice and as an impediment to the potential presented by electronic commerce,” General Counsel Andrew Pincus said. “For cyberspace to function as an effective commercial market, businesses must have confidence that their trademarks can be protected.”

Pincus called for the addition of one or more representatives of the intellectual property owners to ICANN. In addition, he argued, the copyright and trademark owners should be consulted during the process of developing policies for the overall domain name system, not just intellectual property issues.

A Registrar’s Concern?

A frequently offered approach to policing trademark infringement has been to require domain name registrars to track who is applying to use particular names, and make the list of who actually controls domain names publicly available. Along those lines, a list of commonly recognized trademarks would have to be compiled as an “off-limits” database domain name registrars could refer to.

Asking domain name registrars to police trademark infringement when an entity applies for a domain name is unreasonable, Network Solutions Inc. Chairman Michael Daniels says. NSI, which has signed up 5 million of the estimated 7.2 million top-level domain names, understands the issue of protecting trademarks but feels caught between trademark holders and domain name holders that have built up Internet businesses around a particular name, he said.

“To attempt to overlay the registration of domain names with a screening or regulatory function would severely disrupt the rapid expansion of the Internet by bringing the registration of domain names to a virtual halt,” Daniels told the subcommittee. “Neither Network Solutions nor any other domain name registrar has the expertise, authority, or governmental immunity that would be necessary to perform such a function.”

NSI argued allowing 250 registrars of top-level domains on the Internet, “each with its own requirements for registration, its own dispute policy, and bound by the laws and regulations of its country,” to determine who can have what name would not constitute a uniform approach to the problem.