[comments-wgb] position on the issues

["Judith Oppenheimer" <joppenheimer@icbtollfree.com>]

I am a WG-B member, and I endorse the following three positions on trademark
issues and new tlds.

Judith Oppenheimer
President, ICB Inc.
http://www.JudithOppenheimer.com


1. SUNRISE + 20: THE NUMBERS TELL THE STORY

This is a response to the Final Report of Working Group B, which was written
by the Chair and submitted to the Names Council on April 17, 2000. If you
wish to endorse this comment, please send us an e-mail and your name will be
added to the list below. This response will be submitted to ICANN on April
30, 2000.

The text below is endorsed by the following individuals:

Ellen Rony, Co-author, The Domain Name Handbook: High Stakes and Strategies
in Cyberspace, Member WG-B
Michael Froomkin, Professor of Law, University of Miami
Milton Mueller, Professor of Law, Syracuse University, Member WG-B
Christopher Ambler, Founder, Image Online Design, Inc.
Judith Oppenheimer, President, ICB Inc., Member WG-B

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Working Group B was created in Berlin last summer explicitly to address
Chapter Four of the Final Report of the WIPO Internet Domain Name Process,
"The Problem of Notoriety: Famous and Well-known Marks". The WIPO Report
recommended that a mechanism be established for granting exclusions to
famous and well-known marks when new gTLDs are introduced. This has been the
focus of the discussion in Working Group B for nearly nine months.

The Final Report of Working Group B, written by the Chair, identifies two
consensus conclusions:

The creation of a universally famous marks list does not appear to be needed
at this point in time.
There appears to be a consensus that protection afforded to trademark owners
will depend upon the type of top level domain.
The report also insinuates support for a Trademark Sunrise+20 Proposal
submitted on deadline by the Intellectual Property Constituency.
Regrettably, too much attention is devoted to this strawman proposal, which
was not vetted at all by members of Working Group B. Recommending a sunrise
exclusion for ALL trademarks exceeds both the scope of WGB and ICANN's
charter as the technical coordinator of Internet administration. The sunrise
proposal is inherently inequitable, operationally impractical, internally
inconsistent, and nonconforming with the tenets of trademark law.

Domain names possess characteristics that cannot be inferred to marks. They
are extraterritorial and require no contextual association. And they are
unique. The ISP Sunrise+20 on-deadline proposal thus fails to present a
substantive solution to the problems confronting the holders of famous
marks. Instead, it represents a wish list for two constituencies who have
the most to gain.

The numbers tell the real story.

According to the US Patent and Trademark Office, the US alone has more than
one million active registered marks. Sunrise+20 variations therefore
represents a potential set-aside of 20 million domain names before a single,
markless individual, association, organization, foundation, cause or event
gets even one. This proposal gives trademark owners their top choice of
domain names without competition against other legitimate users, the general
public. And the registrars get an immediate, potential windfall of 20
million registrations, which would add in excess of $200 million to their
coffers. Of course, they will support such an immediate financial
opportunity.

The WGB Report comments, "This compromise would eliminate the need for
Registries to filter out domain names that potential infringe a trademark on
an ongoing and permanent basis". This is a red herring. It has been
well-established that registries have *no* obligation to engage in such
filtering on behalf of the trademark owners.

"Nothing in trademark law requires that title to domain names that
incorporate trademarks or portions of trademarks be provided to trademark
holders. Instead, the law simply prevents others from making use of a
company's trademarks in a manner likely to confuse the consuming public."

--Washington Speakers Bureau, Inc. v. Leading Authorities Inc., 51 USPQ2d
1478, (E.D. Va. 1999)

The Sunrise+N (any number of variations) proposal does not address how
multiple owners of identical marks determine which one gets the most
desirable domain names. Nor does it consider when the choice of a variation
becomes an unreasonable stretch of the imagination. And while trademark
offices in more than 130 countries follow the same International
Classification standard for goods and services, the application
requirements, examining procedures, processing time and legal protections
vary from one country to the next. Thus, this proposal will encourage
trademark forum shopping and, perhaps drive-by, 48-hour turnaround trademark
certifications.

In the trademark-centric view of the Internet, a domain name alone gives
rise to a "chance of confusion". Yet, with so many creative variations of
any word or mark by adding prefixes and suffixes, plurals, numbers and
dashes, the days when people merely guess at a domain name to find a
particular site are over. If a domain name alone gives rise to a chance of
confusion, then the trademark owners that register 20 variations will be the
greatest source of such confusion.

The meta question here is what justifies giving owners of trademarks or even
"famous" marks" a preemptive right to register any domain names or any
variations. Why should trademark owners receive preferential treatment in a
publicly accessible, global communications medium?

One of the tenets of the Department of Commerce Statement of Policy, a.k.a.
the White Paper, is, "the new corporation should operate as a private entity
for the benefit of the Internet community as a whole." A sunrise proposal
for trademarks or famous marks provides an unsupportable pre-emptory bias to
the commercial sector of the Internet over all other legitimate uses of the
same or similar character strings. Indeed, this proposal condones corporate
hoarding of a significant percentage of domain names before a single
non-commercial user is allowed to select an online moniker.

Registering 20 variations of a mark will not make the task of policing marks
disappear. But it will lead to stuffing the registry database with redundant
domain name registrations and a multi-million set-aside of names which have
scant association to the registered marks.

While people have sympathy for companies and individuals who face true
infringement and misappropriation of their marks, these are not new problems
to the intellectual property community, and strong legal sanctions already
exist in the U.S, and elsewhere to address such concerns.

Instead of providing pre-emptory registration rights for one segment of the
Internet community, encourage ICANN to establish a new, chartered top level
domain, .TMK. Bid adieu to the sunrise proposal, to exclusion, preemptive
variations and take downs. Bid adieu, too, to those who want to exploit the
goodwill developed in those marks. Let .TMK be an exclusive sandbox only for
those who possess a trademark registration certificate.

In summary:

There are sufficient existing protections for trademarks, including federal
law and statutes, the UDRP and monitoring mechanisms. Preemptive exclusions
or a sunrise proposal are unnecessary.
A famous marks list used for exclusionary registrations creates new
preemptive rights that do not exist in law.
A sunrise period is not likely to reduce the number of cybersquatters nor
diminish the trademark owners concerns over policing the use of their marks
Introduction of a top level domain solely for registered owners of
trademarks is the most efficient way to assure that users find the sites
associated with those marks and limit the value of cybersquatting.

By Ellen Rony
April 28, 2000

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2. BEWARE OF MONOPOLIES PROPOSING TO 'OPEN UP' MARKETS

by Milton Mueller is Associate Professor, Syracuse University School of
Information Studies. See http://dcc.syr.edu

New top-level domains (TLDs) are badly needed, as the dot com space is
getting increasingly crowded. But for five years changes in the TLD space
have been stymied by political controversy.

On April 14 an official ICANN working group proposed to create six to ten
(6-10) new top-level domains. The official working group report can be found
at: http://www.dnso.org/wgroups/wg-c/Arc01/msg01095.html

On April 19, Network Solutions Inc. (NSI) released a proposal to ICANN to
reduce the number of new top-level domains to two (2). Only one of the two
proposed new domains (.shop) would provide an alternative to NSI’s
longstanding monopoly on registration in the .com, .net, and .org top-level
domains. The other would be a restricted TLD for banks (.banc). NSI
"generously" offered to operate the registry for .banc.

The NSI proposal is a step back from where ICANN should be going. It would
slow the introduction of new TLDs down to a crawl and limit new domain name
registries’ ability to compete effectively with NSI. The proposal is
designed to prolong NSI’s dominance of the domain name market.

The NSI proposal can be characterized as profoundly anti-competitive for
four reasons.

It would require the new (.shop) registry to offer exactly the same terms
and prices as the NSI com/net/org registry It drastically limits the number
of competing registries, for no good reason. Its ownership arrangements
would institutionalize cartel-like controls on the name space. It would put
NSI in charge of the back-office services of one the .banc registry, further
reinforcing NSI’s dominance of the domain name registry market. 1. The
proposal eliminates competitive differentiation

The proposal would have ICANN sign a contract with a new registry
"substantially identical" to NSI’s current registry agreement with ICANN and
the US Department of Commerce. That means that the new commercial registry
would be forced to offer exactly the same terms and conditions, including
price, that NSI now does. If new registries are unable to charge lower
prices or to differentiate their terms of service, how can they engage in
real competition with the well-known NSI dot com registry?

2. The proposal drastically limits the amount of competition.

The official ICANN working group charged to develop recommendations on new
TLDs reached a broad consensus that there should be at least 6-10 new TLDs
this year. This recommendation commanded a two-thirds consensus of the
working group members, and was supported by public comments. The 6-10 number
was proposed in order to achieve a more competitive marketplace and to allow
a variety of different ideas and business models to be tested. However, NSI
proposed to create only two new top-level domains. Only one of them (.shop)
would be an open name space similar to .com/net/org. Thus, the level of
competition created by the proposal is about as minimal as it can get.

The highly publicized Network Solutions proposal was part of a deliberate
effort by NSI to divert attention from the Working Group’s recommendations.
At the Names Council meeting April 19, Network Solutions representative
Roger Cochetti led a vote to reject the broad consensus for 6-10 new TLDs.

3. Proposed ownership arrangements undermine competition and diversity

The new registry proposed by NSI would be cooperatively owned by all the
existing registrars accredited by ICANN. This means that NSI, which
currently controls about 80% of the registrar market and holds a monopoly on
the gTLD registry market, will hold a major stake in the new registry and
will profit from its success. The NSI proposal does not specify ownership
and governance arrangements, but typically ownership shares are based on
market share. Given its size and resources, NSI would have significant
influence on the proposed new registry’s pricing and policies. Working out
governance arrangements among over 100 registrars, with new ones being
accredited every month, will not be simple, contradicting NSI’s claim that
their proposal will speed up the introduction of new TLDs. Even if NSI does
not dominate ownership of the new registry, neutral observers must be
concerned with the spectacle of a Domain Name policy making body that is
only able to award resources to its own members.

4. Collusion proposed

In its desire to protect itself from competition, NSI was not satisfied with
reducing the number of new registries from ten to only two. It also proposed
to run the "back-office services" for the .banc restricted TLD. In other
words, one of the two new registries NSI proposed would be none other than
NSI itself.

Other significant points:

"Proof of concept" a deceptive ruse

The NSI proposal is based on the false premise that authorizing a new
top-level domain registry is a step into unknown territory. The small number
is justified as reflecting the need for "proof of concept." But technical
experts agree that there are no technical barriers to adding thousands of
new names to the root. Operationally, there is nothing new or untested about
adding new top-level registries to the Internet root. The TLD .int for
international organizations was added a few years ago with no significant
problems. The late technologist Jon Postel, who administered the DNS root
for more than a decade, drafted a proposal defining procedures for adding
150 new TLDs back in 1996. In 1994 alone, 50 new country code TLDs were
added to the root, and country code TLDs operate in the same way as
.com/net/org TLDs. There is simply no evidence for NSI’s claim that new TLDs
require "proof of concept."

The European gambit

NSI’s proposal to locate the new .shop registry in Europe is a calculated
attempt to win political favor for the proposal. US-European rivalry has
played a major role in the domain name wars, and the Europeans are extremely
sensitive to their status. However, the move could also be seen as an
attempt to pre-empt European efforts to create their own new registry under
the .EU or .EUR TLD. A new, truly European TLD would attract much more
business registrations from Europe than NSI’s proposed .shop, and cut into
the dominance of dot com. Shared ownership of the new registry by
ICANN-accredited registrars – 60 percent of which are American – would
further dilute European market share. The small number of new TLDs under the
NSI proposal also shuts out other regions, such as the growing Asia-Pacific
region.

Conclusions

If ICANN implements NSI’s suggestions, NSI’s dominance of the domain name
market would be prolonged for another year or more. Management of the domain
name space will take on all the features of an international cartel. The NSI
proposal offers vested interests privileged access to the new name space
while shutting out consumers, non-commercial organizations, and independent
entrepreneurs.
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3. Two Objections to the IPC
"Famous Names" or "Sunrise"
Proposals for Controlling
Entry Into New gTLDs
Richard Sexton
John Berryhill, Ph.D. esq.
April 16, 2000

(1) - The Exclusionary Proposals Have No Basis In Technology Or Law
These comments essentially boil down to the fundamental maxim of Law, "Where
there is a right, there is a remedy." The ICANN Intellectual Property
Constituency's various exclusion or "sunrise" proposals are not in
accordance with the remedial nature of the Law. These proposals are for
prospective, pre-emptive restraints of the kind that we do not permit our
own government to exert in the enforcement of criminal law relating to the
use of words. Even where an injunction is granted, an injunction is (a)
directed to identifiable individuals, (b) for cause and (c) based on an
adjudication of relative harms. Why should private individuals have greater
power to pre-empt the actions of others to prevent potential civil liability
when we do not grant government that power to prevent criminal violations?

A trademark gives the owner a right to seek a remedy for a violation of the
trademark. Trademarks do not provide an automatic, a priori pre-emption of
the use of alphanumeric characters in the real world. Trademark law has
developed to balance various interests. There is no reason to provide a new
kind of trademark right on the Internet which does not correspond to any
principle of trademark law in the offline world.

The IPC proposals have perverted Law to "Where there is a right, there is a
way to prevent people from violating it." That has never been the way Law
functions in our society, and it has certainly never been the way the
Internet functions. If it's not "technical administration", and if it is not
"law", then what is it? Technical concerns say (a) domain name allocations
are to follow RFC1591 - first come, first served and (b) there is a need for
a larger name space. The Law says that RFC1591 has valid legal regulatory
authority (as per the PGMedia decision of the DC Court of Appeals) and that
violations of private rights can be remedied after the fact. The IPC
proposals do not arise from valid technical or legal principles.

MichaelKirkIsaPedophile.com is libelous, and has legal consequences as a
string of text.

HaveSexWithMeForMoney.com is a criminal solicitation.

TheHolocaustIsaJewishLie.com is likewise a criminal utterance, but in
Germany, not the U.S.

MuhammadTheProphetAtePork.com is blasphemous and likely a capital offense in
several countries.

Yet, despite these and other categories of legally significant alphanumeric
character sequences, some even criminal in nature, nobody is proposing a
prior restraint on them.

Trademark infringement is only a subset of a much larger category of
legally-proscribable uses of alphanumeric characters. Why, among all forms
of legally significant text strings, are trademarks singled out for a
heretofore unknown pre-emptive right? Because ICANN, a technical body, has
an "Intellectual Property Constituency" with non-technical concerns.

There is no "Libel Constituency", "Anti-Obscenity Constituency", "Criminal
Solicitation Constituency", or "Religious Constituency". Why not? Because
these issues do not relate to technical administration, which is the
mandated mission of ICANN.

Despite the talk about the "importance of stability to the development of
e-commerce", ICANN was not chartered to be about commerce or whatever else
for which the internet might be used. They are supposed to be running narrow
technical aspects of a computer network. "Do the bits get from one end of a
wire to the other?" is not a legal question. Re-engineering the remedial
principle of law as a proscriptive technical policy makes no sense.

Trademark infringement happens in telephone book listings. All kinds of
shady folks get fraudulent telephone book listings, or use "Yellow Page" ads
which infringe trademarks or convey a false or unfair commercial impression.
These situations are dealt with all of the time by trademark lawyers. They
are not dealt with by providing a pre-emptive famous name list or a sunrise
period for telephone books. In fact, the makers of the telephone books are
not held liable for these kinds of things. In the context of 800 number
assignments, the FCC has decided that dealing with trademark issues is a job
for trademark lawyers, and not for technology policy makers at the FCC. Why
should ICANN be any different?

The DNS is a telephone book. It maps names to numbers in precisely the same
way. Why is it that we manage to publish telephone books without difficulty?
Why would we argue about adding a new telephone exchange in an area code,
become concerned that the possibility of a greater number of telephone
listings would provide more opportunities for trademark infringement, and
suggest that it would subject the telephone book publishers to legal
liability? Because they are ridiculous assertions. But somehow the analogous
assertions are taken seriously in the context of the DNS.

Even when someone has successfully asserted a trademark right involving a
telephone listing, the books themselves are not published again until a year
later. The DNS can be altered within a matter of hours to reflect a
succesful, and remedial, assertion of trademark rights. That serves the
interests of IP owners even more efficiently than an analogous system -phone
books - with which we have lived comfortably for years.

To make the picture even clearer. I can infringe trademarks with my business
card, letterhead stationery or outdoor signs. But when I walk into the print
shop, there is no IP daemon sitting on the shoulder of the printer with the
job of determining what words I may or may not have imprinted on my business
materials. I bear the legal consequences of my choice, but I am as free as
anyone else to have my own business materials without having to wait outside
during a "sunrise period" in which the "first among equals" negotiated what
is to be left over for me to have.

And so we develop a Byzantine system of chartered and non-chartered TLDs,
and a system of restrictions and lists and sunrise periods on top of that.
The next day after I, a lowly individual, am allowed to register domain
names with the great unwashed masses, I obtain generic.generic (in the new
"generic" TLD). And the day after that I set up my server to resolve the
URL: kodak.ibm.cocacola.generic.generic/kiddieporn.html . Then what did any
of this nonsense buy for anyone other than delay and large expense account
bills?

Bold prediction #1 - there will continue to be rampant intellectual property
violations on the Internet.

Bold prediction #2 - there will be no way to prevent it, but there will
remain remedies at law.

(2) - Artificial Constriction of the Name Space by the IPC is Hurting Small
Business

There already are mechanisms to enforce trademark rights in cyberspace - the
UDRP and the ACPA among them. Both of these mechanisms are available to
anyone who can afford a lawyer, which, with the UDRP, includes many but not
all small businesses. Genuine cybersquatting hurts small businesses in
smaller gross monetary terms, but perhaps in larger proportionate terms for
the affected businesses, than it does larger businesses.

However, when BigBusinessCo is faced with a squatter who has occupied
BigBusinessCo.com, .net and .org, then BigBusinessCo can readily afford to
get rid of the squatter. Joe's Fish Market is faced with a much larger
problem, because they cannot so readily afford to do the same thing.

The presence of a large, and we mean very large, number of TLDs does two
things to help Joe's Fish Market - it increases the cost of pre-emptive
cybersquatting and it decreases the value of any one domain name occupied
but not used.

If someone is sitting on the domain "cocacola.irrelevant", not producing any
content at a corresponding website, and demanding thousands of dollars from
Coca-Cola, then why would anyone, including Coca-Cola care? The commercial
injury to Coca-Cola of a tiny vacant island in a sea of thousands of TLDs is
approximately zero. In fact, it is actually zero. The squatter with his
do-nothing domain name can pay annual registration fees to his heart's
content and remain unnoticed and ignored.

Now, yes, there is such a thing as trademark infringement, but if the only
thing one sees at a web site is "This Domain for Sale!" or "We Registered At
Lousynames.com!" then what is the basis for any consumer to be confused
about anything? They were looking for a brown fizzy beverage in a red can.
"Hmm.... must not be at this domain name...."

Conclusions

Several have floated a compromise proposal of a mixture of "chartered"
versus "non-chartered" TLDs, and how many of each there should be. The
question of how many is comparable to the question of whether it would be a
good idea to have a large quantity of even numbers or odd numbers. In fact,
there is no good reason not to have an infinite supply of both. The
mechanisms for restricting registrations according to various pre-emptive
systems are flawed technically as they do not accord with RFC1591, and they
are flawed legally as they do not accord with the remedial character of Law
as we in the West have come to know it over a learning curve of hundreds of
years. The IPC does not have the technical background to dictate how to run
the Internet, and WG-B does not have the legal sophistication to re-write
fundamental principles of trademark law, or law generally, in single
weekend.

This is not how to run a computer network.