The New Masters of Domains

SAN FRANCISCO (08/31/2000) - Kenneth harvey never intended to confuse shoppers when he registered the domain name Walmartcanadasucks.com. The 38-year-old writer from Newfoundland says he just wanted to get under Wal-Mart's skin. After all, Wal-Mart had already convinced an international arbitrator to strip him of the Walmartcanada.com domain, without compensating him for the $70 registration fee.

But his ploy backfired. Instead of securing a new forum to speak his mind, last month another arbitrator took the Walmartcanadasucks.com domain from Harvey.

So goes the latest incarnation of domain-dispute resolution, now conducted by four organizations worldwide: CPR Institute, eResolutions, the National Arbitration Foundation and the World Intellectual Property Organization. Most notable is WIPO, which joined the United Nations in the 1970s to help protect intellectual property rights. The new arbiters take up where the Internet Corporation for Assigned Names and Numbers left off. Last year, ICANN took over administering domain names from the U.S. government and adopted a policy that forces allegations of infringing registrations to go to arbitration instead of national courts. But a growing number of free-speech advocates, academics and consumer representatives allege that some of the arbitrators - WIPO first among them - are expanding the definition of what constitutes trademark in cyberspace.

On average, more than three out of four cases processed this year have been decided in favor of corporations. The losers: individuals, speculators and smaller businesses. Most of these cases have involved "cybersquatters" - people who register domains, often in bad faith, in the hope of extracting profits from companies that have a legitimate claim on the names.

But some decisions have transferred ownership of names involving generic terms. The address Crew.com was awarded in April to apparel maker J. Crew International, even though the term is commonly used for everything from the rowing sport to the group that pilots a ship. Some other cases have involved misspellings of trademarked names. Yahoo three weeks ago was awarded 40 variations of its name and that of its GeoCities subsidiary, including Ayhoo.com, Eocities.com, Yafoo.com, Yahu.com, Yanoo.com and Iahoo.com. Even geographical locations hang in the balance; ownership of Barcelona.com was recently awarded to the Spanish city. The name was removed from an American speculator, although in the U.S. place names aren't considered trademarks.

A statistical study by Syracuse University professor Milton Mueller has found that arbitrators tend to rule differently. WIPO and NAF panels rule in favor of the trademark holders about 80 percent of the time, while those cases decided by eResolutions result in such transfers only 55 percent of the time. Mueller says that since complainants choose the organization with which they file a claim, panels try to woo trademark holders by ruling more often in their favor.

Francis Gurry, WIPO assistant director general, disagrees, saying that most cases are very narrow, involving trademark registrations, name confusion and "bad faith" registration.

Still, that WIPO decisions favor trademark holders shouldn't surprise anyone. The roots of the organization date back more than a century to the Paris Convention for the Protection of Industrial Property and the Berne Convention for the Protection of Literary and Artistic Work; the agency joined the U.N. family in 1974. Membership is open to governments only, although many nongovernmental organizations are observers.

WIPO's mandate is to promote the protection of intellectual property. But the organization - for a fee - also helps companies file patents and trademarks internationally, cutting the costs of applying for them country by country around the world. The international registration systems fund about 85 percent of WIPO's budget, which is about $200 million for 2000 and 2001.

And now the agency is busy with domain disputes, proving to be a more popular forum than anyone had imagined. Corporations have filed more than 1,000 claims seeking ownership of everything from Newyorktimes.com to American-online.net to Lockheedmartinsucks.com. The way the system stands now, a one-arbitrator panel costs a complainant $1,000; the respondent can add other arbitrators, raising the fee to $3,500, which is split by both parties.

Trademark owners want more than the current system: They're demanding immediate injunctive relief and a wider scope of allowable challenges.

"Our brand is our identity," says Marilyn Cade, director of Internet and e-commerce policy and advocacy at AT&T, which wrestled Attt.com from the operator of a pornography Web site. "If we're letting people misuse our brand by posting fraudulent or pirated or porno sites, we're allowing our brand to be diluted," she says.

But consumer advocates argue that the trademark community has been using the dispute resolution system to trample the little guy. "They need to have some pro-consumer guidelines to avoid some of the abuses against the public," says James Love, director of the Consumer Project on Technology, who believes the decisions are rife with contradictions and need to be reviewed. Love says that many of the disputes over domains would be resolved if ICANN increased the number of top-level domains.

"You could have a .fans or a .sucks domain or you could break them down into different industries so you wouldn't have confusion between the sports team Penguins and someone who publishes books," he says.

Others argue that the arbitration system should be replaced by a jury system since one of the key elements is whether a domain name was registered in bad faith. "Bad faith is not something they teach you in law school," says David Post, a law professor at Temple University who is involved with WIPO competitor eResolutions.

The criticism of the rulings comes at a time when WIPO, which has played a key role in developing ICANN's dispute resolution guidelines, wants to expand the definitions of what constitutes cybersquatting - and hence the types of cases that organizations can arbitrate. WIPO is now focusing on expanding into a few key areas - rights to personal names (such as George.com), names and acronyms for public organizations (WIPO, for example) and scientific names for things like pharmaceuticals.

The deadline for public comment is Sept. 15; hearings around the world will follow. "We're trying to examine to what extent the world of virtual identifiers can be made compatible with real-world identifiers," says Gurry.

Some observers argue that it's too soon to start expanding the types of domain names that can be considered in the dispute-resolution system. "That debate belongs in Congress," says Michael Froomkin, a law professor at the University of Miami who consulted with WIPO during the first round.

But Harvey, twice disappointed, says the corporations already have too much pull. "WIPO is king," he says. "They answer to no one."

Wal-Mart, on the other hand, considers the process successful in preventing its good name from being hijacked by the Kenneth Harvey's of the world.

It's not about free speech. It's about trying to prevent the kinds of abuses that Mr. Harvey has been accused of," says Andrew Pelletier, public affairs director for Wal-Mart Canada. "He was clearly registering the name in order to extort money from Wal-Mart."

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