The Internet is exploding as a means of international communication and commerce. Commercial entities and individuals may simply register and run an internet site with a distinct name that is accessible globally. It is a global commons where ideas, products, goods, and services are moved back and forth effortlessly with no need for passports and border crossings. However, it has been organized exclusively with Latin-based characters giving this global vehicle a decidedly Western bent - up until now. The first Internet addresses containing non-Latin characters from start to finish will soon be online thanks to the October 30th approval of the new Internationalized Domain Name (IDN) Fast Track Process by the Internet Corporation for Assigned Names and Numbers board (ICANN). Prior to this change, domain names were restricted to Latin characters – the 26 characters in the English alphabet. What are the implications of an internationalized Internet for our customers? This move opens the market to an infinite number of domains and phishers, pirates, and scammers. There are trademark infringement implications, potential cyber pirating issues, and the thorny jurisdictional questions inherent in this borderless cyberworld.
The jurisdictional issues present a particularly challenging conundrum for Latin-based domain name holders. For example, if a “Domainer” (someone who snaps up thousands of potential domain names) snatches the Arabic version of Ben & Jerry’s website (www. بن اند جيري.com) and attempts to extort money from the US company (which also markets to countries in the Middle East) in exchange for the Arabic domain name, would the Anticybersquatting Consumer Protection Act (“ACPA”) apply to a foreign Domainer? Any first year law student can address the issue of personal jurisdiction and the long-arm statutes that can corral an entity and bind it to the court’s decisions. Even if a domestic court could assert personal jurisdiction, unless a foreign entity is motivated to make money within the United States (the United States is just simply too large of a market to dismiss or ignore its legal processes and risk being shut out of the market), a Domainer is unlikely to comply. Therefore, the best protection for global brands will be to purchase their IDNs as a preventative measure.
Companies have worked diligently to create trademarks that make statements and appeal to prurient and other ego-driven interests of consumers. Consumer classifications and images associated with companies’ marks do not happen by accident. They are well thought out by the marketing strategists and billions of dollars depend on the public’s embrace of the image. Therefore, a lot of money and capital ride on protecting the companies’ reputation, marks, and business interests.
Trademark law is designed to protect holders from those who would “pass off” and profit from someone else’s hard work and generation of good will. Passing off involves the use of a mark in ways that are likely to cause confusion as to the source of the product. In addition to protection from using a mark to cause confusion, trademark protects against dilution which are uses that blur a trademark’s distinctiveness.
The Anticybersquatting Consumer Protection Act (“ACPA”) was enacted in 1999 to thwart the cybersquatters and pirates who register domain names containing trademarks with no intention of creating a legitmate website. Similarly, the Uniform Domain Name Dispute Resolution Policy (“UDRP”) was adopted by ICANN in 1999 to offer an alternative to litigation in local courts to settle complaints by trademark owners about cybersquatting.
Whereas trademark law permits multiple parties to use the same mark for different classes of goods and services or from different geographical areas, the current organization of the Internet permits only one use of a domain name, regardless of the goods or services offered or where each company is headquartered. For example, although two or more businesses can own the trademark “Ayvazian Sisters”, only one business can operate on the Internet with the domain name “ayvaziansisters.com”. But now, ayvaziansisters.com can appear in non-Latin characters. This obviously complicates the determinations made by courts based on the traditional tests used to determine trademark infringement and there is no global legal framework in place accepted by the international community and sanctioned by the US via the Supreme Court or Congress to deal with this complex jurisdictional issue.
So, while the state of the law is uncertain, navigation through the legal minefield poses significant risks for customers faced with potential trademark infringement issues. And it is a problem that most globally-focused companies will likely face. Stay tuned for future posts.
