Companies Bemoan Domain Quicksand

FRAMINGHAM (01/28/2000) - Companies acting already to protect their trademarks from cybersquatters through such means as registering versions of their company names that have misspellings or dashes may soon have to do a lot more.

The Internet Corporation for Assigned Names and Numbers (ICANN), based in Marina del Rey, Calif., is considering increasing the number of top-level domains, expanding the .com, .net and .org to potentially include a .biz or .shop plus dozens more. The group plans to discuss this issue at its March meeting in Cairo.

The prospect of having even more domains to protect worries Nils Victor Montan, vice president and senior intellectual property counsel at Warner Brothers Inc. in Burbank, Calif.

Warner Brothers is already sending out more than 100 letters each week to cybersquatters who have registered variations of the company's movie, book and recording trademarks. And the new federal cybersquatting law doesn't seem to be a deterrent.

"There is no benefit to any of this - people register these domain names, you chase them down, you have to write them letters," Montan said. "This is like spinning wheels in mud. It's a stupid way for society to be operating."

Cybersquatting has continued, despite some relatively new ways for companies to protect their trademarks. Cybersquatters risk penalties of up to $100,000 under a law Congress passed last fall. Additionally, there's an administrative procedure run by the World Intellectual Property Organization in Geneva that can settle a dispute and revoke a domain name. It currently has about 20 cases before it.

The law favors trademark holders, but the number of possible domains makes protection difficult. There are some 220 top-level domains, many of them country-specific. And there's now the ability to register 63-character domains, up from 22 characters, plus the top-level domain.

Chicago-based Britannica.com Inc. recently had its trademark - Encyclopaedia Britannica - registered as one long domain name by someone in Australia. And it wasn't the first time someone had registered a variation of the name.

Keith McDonnell, the assistant general counsel at Britannica, says he wishes registrars did more to protect famous trademarks. "It's easier [for registrars] to just hand them out and let trademark owners spend the money" to get them back, he noted.

The addition of new top-level domains opens up the possibility that there might be the domain-name equivalent of an Oklahoma land rush, as people race to register business.shop or something like it.

Preferential Treatment

ICANN is considering proposals to prevent that from happening, such as giving famous-name trademark and domain holders preference, said ICANN general counsel Louis Touton.

"While the first come, first served is a convenient rule in an ongoing process, it may not be a good rule when you are opening up a new domain," Touton said.

The threat of new domains didn't stop Jake Winebaum's venture capital company, eCompanies LLC, from paying $7.5 million for business.com, a generic domain that can't be trademarked.

But Winebaum says he believes "the .com domain is the domain the user goes to first, and that will not change in the foreseeable future, no matter how many new domains are opened up."

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