WIPO Tackles Domain Name and Trademark Conflicts

© 2001, 1999, Deeth Williams Wall LLP. All Rights Reserved. By: Michael Erdle

Table of Contents

Introduction

In response to recent U.S. and international initiatives to reform the management of Internet domain names, the World Intellectual Property Organization (WIPO) is currently studying a series of recommendations aimed at improving domain name holders and trademark owners, and protecting internationally famous marks from "cyber pirates".

The recommendations are contained in a report released on December 23, 1998. A WIPO panel is conducting further consultation meetings around the world in 1999, to gauge reaction to the interim recommendations and to obtain further comments on a number of issues. The first consultation meeting was held in Toronto in January. A final report is expected to be released later in the year.

Increasing commercial use of the Internet has created frequent conflicts with national trademark rights. In June, 1998, the United States Department of Commerce published a White Paper which concluded that the administration of the generic Top Level Domains (gTLDs) should remain in the private sector and should be opened up to competition. The monopoly that Network Solutions Inc. has enjoyed, especially in the .com domain, should be eliminated, the U.S. government has decided. Internet Corporation for Assigned Names and Numbers (ICANN) was established late in 1998 to administer the gTLDs (.com, .net and .org). ICANN is based in the United States, but has an international mandate.

The WIPO process was initiated in response to perceived "predatory and parasitical practices" relating to domain names. The report cites "the deliberate, bad faith registration as domain names of well-known and other trademarks in the hope of being able to sell the domain names to the owners of those marks, or simply to take unfair advantage of the reputation attached to those marks."

The 93-page report has a series of recommendations on registration procedures, dispute resolution and the protection of famous trademarks.

WIPO's mandate is limited to the gTLDs, however, the report's authors note that many of the recommendations may be adopted by administrators of the 200-plus country code domains (ccTLDs), including the .CA domain. In fact, the Canadian Internet Registration Authority (CIRA), established late in 1998 to reform the .CA domain, has already considered many of the issues in the WIPO report.

Domain Name Registrations

The Interim Report recommends that all registration authorities have formal legal agreements with all domain name holders, to ensure that reliable information about the domain name holder is available and to establish procedures for dealing with false or inadequate information.

Opinion is divided over whether all information relating to domain name registrations should be publicly available. Trademark owners and others who may want to challenge infringing domain names want unrestricted access to contact information and other details about the use of the domain name. Others concerned with the protection of personal privacy have advocated various filtering methods, such as the use of registration agents, to safeguard freedom of expression, particularly for non-commercial domains. In any event, registration agreements will have to specify how personal privacy laws in Europe and other jurisdictions. (Such terms will also have to be included in the .CA registration agreement, if Bill 54, introduced by the federal government last fall, is enacted).

WIPO has recommended that providing false, inaccurate or incomplete information in a domain name application be grounds for revoking the registration. Commentators have suggested that it may be more appropriate to temporarily suspend a domain name, if the registration authority receives a complaint from someone who has been unable to contact the domain name holder. The registration authority would attempt to contact the registrant and, if there were no response within a specified period of time, the registration would be revoked. The registration agreement may also impose an obligation on the domain name holder to keep all information up to date. Annual renewals would provide a means to weed out inactive domains and domains where it is impossible to contact the domain name holder.

Dispute Resolution Procedures

The WIPO Report recommends a regime of mandatory administrative dispute resolution (ADR) to deal with disputes between domain name holders and trademark owners. Domain name holders would have to agree to this ADR process when they apply for a domain name.

There are many potential advantages to an ADR system:

The ADR process would not have the power to award monetary damages or to deal with intellectual property disputes other than those arising for the registration or use of a domain name.

But the WIPO recommendations also have several drawbacks.

To avoid the perception that the deck is stacked against domain name holders, it might be better to implement a voluntary ADR process, which would be available to both domain name holders and trademark owners on request.

The WIPO panel has requested further comment on whether the ADR process should have the power to order other measures to resolve domain name disputes, such as modifying the domain name, assigning it to a different TLD or maintaining gateway pages or indexing mechanisms to redirect searches to the appropriate domain. For example, "apple.com" could be established as a gateway with links to Apple Computers, Apple Records and the Ontario Apple Growers, eliminating any dispute over the name "apple".

These suggestions have some appeal, if the goal is to avoid the "all-or-nothing" consequences of litigation. But they would have to be undertaken voluntarily in order to be effective. The parties would also have to agree on who would pay the ongoing cost of implementing and enforcing such measures.

Rules For Resolving Domain Name Disputes

The Interim Report identifies seven "Guiding Principles", for decision-makers, based on a review of the cases which have been decided in national courts concerning domain names and intellectual property rights.

Famous and Well-known Marks

One of the most controversial sections of the Interim Report is the chapter dealing with the protection of famous and well-known marks. "Cybersquatting" has become a serious problem for many trademark owners, especially the owners of internationally famous marks. The report recommends the establishment of a centralized "exclusion list" of famous and well-known marks which could not be used as domain names by anyone other than the trademark owner. Trademark owners could apply to have their marks added to the list. The criteria for inclusion would be those developed by the WIPO Standing committee on Trademarks:

The WIPO domain name report recommends a seventh factor to be considered:

Although these proposals would apply only to gTLDs, the WIPO panel also recommends that the administrators of open ccTLDs participate in the exclusion process, so that the owners of famous marks could obtain uniform protection in all domains around the world. A mark would be excluded in a ccTLD only if that mark was recognized as a famous mark in the country to which the TLD applies.

The problem with all of these recommendations is that there is currently no generally recognized list of famous and well-known marks. Some countries, such as Japan, have published lists of marks that they consider to be famous, but there is no consistency among the existing lists. Most countries, including Canada, do not have statutory exclusion lists. In Canada's case, for example, famous marks can be protected on the basis of "making known" in Canada, even if certain products or services associated with the mark are not available here. In some cases, the common law also provides protection to owners of marks in other countries, where a reputation for that mark can be established in Canada, even without actual use in Canada.

It is not clear why any additional protection is needed in the case of domain names. In the case of the .com domain - the favorite domain of cyber pirates and cybersquatters - almost all of the names that would qualify as famous marks have already been registered. The exclusion list would be an expensive, cumbersome vehicle to protect a very small number of trademarks, all of which are owned by large multinational companies which can easily afford to defend their rights against domain name holders, particularly if the administrative dispute resolutions recommended in the WIPO report are adopted.

In any case, national courts which have heard cybersquatting cases to date have had little difficulty finding in favour of trademark owners and ordering the cybersquatter to turn over the domain name.

Given the lack of international consensus on what constitutes a famous trademark and how they should be protected, and given the availability of other legal remedies to protect famous marks from cyber pirates, it seems unlikely that this part of the WIPO report will be implemented any time soon.

What's Next?

The recommendations in the WIPO Interim Report are still a long way from being implemented. Experts and commentators disagree on issues such as privacy of registration information, whether dispute resolution procedures should be voluntary or mandatory and how much control trademark owners should have over non-commercial uses of the same or similar names.

ICANN's stated aim is to implement the recommendations in the U.S. government White Paper and to open up the generic TLDs by mid-1999. ICANN will look closely at the recommendations in the final WIPO report later this year, but will not implement consensus in the trademark and Internet communities.

Meanwhile, in Canada, CIRA is pressing ahead with the proposed reforms to the .CA registration system, with a mandate to make the domain more assessable to Canadian businesses and individuals. Industry Canada is working on a section-by-section review of the Trade Marks Act to determine whether any statutory reform is needed in order to achieve the federal government's stated objective of making Canada a world leader in electronic commerce. A discussion paper is expected to be released for public comment early in 1999. WIPO is continuing the consultation process on its interim Report. Those who are interested in reviewing current comments, or making suggestions of their own can do so via the WIPO web site. For examples of internet domain name cases in Canada and other countries, click here.

Where to Find More Information

The Interim Report of the WIPO Internet Domain Name Process is available online at:   http://wipo2.wipo.int

Information relating to the formation and organization of ICANN can be found at:  http://www.icann.com/

A copy of the U.S. Department of Commerce Statement of Policy on the Management of Internet Names and Addresses (the White Paper) can be found at:  http://www.ntia.doc.gov/ntiahome/domainname/6_5_98dns.htm

Information relating to the proposed reform of the .CA domain is available online at:   http://www.cira.ca

For more information on Industry Canada's initiatives relating to trademarks and domain names, at:  http://www.strategis.ic.gc.ca

Contact Michael Erdle for more information on Domain Name and Trademark Conflicts.