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Domain Name vs. Trademark Disputes

By Victor Arcuri, Arvic Search Services [1]

This is an old feature article written by Victor Arcuri. It was written at a time when the trademark rules and ‘cybersquatting’ industry was still forming. A good read, even today.

The principle for registration of domain names has been till now first come, first served. Therefore, it’s not surprising that lots of names corresponding with well-known trademarks have been registered by nimble amateurs: sometimes with innocent intent – and sometimes in the hope of a quick payoff from a sleepy company who suddenly wants to get online. But the corporate world (especially in the litigious US) is quickly waking up. Brandishing US federal trademarks intended to protect anything from “stuffed toys” to “Halloween costumes”, corporate lawyers are aggressively appropriating domain names from their sometimes dazed owners. I n any case, everyone trying to register directly under the narrow confines of “.com” won’t work for much longer. With currently around 350,000 entries in “.com” and registrations running at over 10,000 per week (see Figure 1), the desirable possible permutations of useful names is quickly running out. You don’t have to be an Internet guru to see that with the current system there’s not enough meaningful name space for the eventual millions of registrants who’ll want their own cybersite.

Domain Names and Trademarks

The relationship between trademarks and domain names has been described in detail in other papers. One of the best summaries is probably David Maher’s Name? [2]Trademarks on the Internet: Who’s in Charge? [3] Another survey is What’s In a [2]from students at the George Washington University Law School [4].

As mentioned, the principle for registration of domain names has been till now first come, first served. Some domain names relating to famous trademarks like “7up.com” [5] and “mcdonalds.com” [6] were snagged early on by Internet aficionados and were handed over to their respective companies for token gifts or donations to charity. However, the realization that big companies were often willing to pay thousands of dollars for a mnemonic cyberpresence has lead to many cases of what has come to be known as domain name “hijacking”. Many a company has realized after requesting an appropriate domain name that it belongs to somebody else. For instance, “coke.com” currently belongs to Rajeev Arora of California and “rolex.com” is registered to Janice Ard of Colorado. At least in the case of well known trademarks (and faced with legal action), most amateur speculators can be bribed to amicably relinquish an important name.

Caught in the middle between domain name holders and trademark owners, NSI instituted a policy in July 1995, with notable modifications in November 1995 [7] and September 1996 [8] that gave trademark owners the possibility to claim back a domain name if they could produce a corresponding federal (national) trademark.

But this policy has neither mollified trademark owners nor domain name holders. Many rightly point out that trademark law allows multiple entities to share the same name if they are not in competing businesses and/or the same geographical area – for example, there can be a McDonald’s computer company and a McDonald’s hamburger company. However, on the Internet, there can only be one “mcdonalds.com” (now owned by the latter [6]). Trademark lawyers also discovered that a trademark from any country could be possibly used to defend the usage of a domain name. This led to trademark registrations by domain name holders in places like Tunisia, where in 48 hours, a “federal” trademark can be produced. The NSI policy also does not deal with domain names that, although not identical to a trademark, can constitute infringement or US “common law” trademarks not registered under the Lanham Act.

The new NSI policy vis- à -vis trademarks has lead to what some refer to as “reverse” domain name hijacking. For example, entertainment and toy companies are obviously strategically looking at the Internet as a vehicle for interactive entertainment. Naturally, these companies wish to leverage existing product lines and an appropriate domain name is “part of the package”. For instance, Hasbro [9] is using its trademark for the board games “Perfection” and “Clue” in an attempt to claim the domain names “perfection.com”and ” clue.com [10]” Mattel is trying to claim ” memory.com [11]” because “Memory” is the name of one of its games. The current NSI policy makes it relatively easy for these companies to obtain the names they want.

One consequence of all this has been increasing litigation between trademark holders and domain name owners. And sometimes, the registration authority, NSI, has also been dragged in on the disputes. As of August 1996, NSI has been named party to ten related lawsuits. Six have been instituted by domain name holders against NSI, arguing that they should be allowed to keep their names. The remaining four were instituted by trademark owners but none of these named NSI alone.

Criticism of NSI is surprisingly widespread in the Internet and trademark community. There can be little doubt that much of the activity towards an evolution of DNS policy is a reaction to this. Among Internet users, what has upped the ante considerably is the charge for name registrations which has lead to different levels of service expectations. The trademark community (e.g., the International Trademark Association [12] (INTA)) is also not happy that they cannot get facilitated access [13] to the database of registered domain names so they can conduct trademark searches.

Some have suggested using extensive geographical subdomain naming conventions as a solution for the trademark issue. But if we imagine an Internet that is someday as ubiquitous as the telephone, one only needs to take a look at a phone book to realize the scale of the problem. The necessary granularity to deal with all possible trademarks and homonyms in domain name space would lead to names that essentially resemble postal addresses such as “www.mcdonald.apt23.54thstreet.nyc.ny.us”. And it is obvious that companies like IBM want to keep addresses like ” www.ibm.com [14]” (or even better, have “www.ibm”) and have no interest in being “www.ibm.armonk.ny.us”.

One of the basic problems that NSI faces is that it is handing out international domain names but that existing trademark law is fundamentally national – there is no such thing as a widely recognized “international trademark”. In the non-Internet world, there is an established tradition of dealing with trademarks on a national basis. The rules to deal with trademark issues may be different in the US, France or Japan but there is a procedure and clear jurisprudence for dispute resolution. This is strongest at the national level with occasional provisions at the regional and international level.

The closest one can get to an international trademark is to file in the World Intellectual Property Organization’s (WIPO) “International Register of Marks under the Madrid Agreement and Protocol”. About 47 countries are signatories to this but conspicuous by their absence are the US (due to a problem of the European Union having an independent vote) and Japan. The WIPO database has about 310,000 marks registered with about 20,000 added per year. However, filing in the WIPO register really only facilitates making multiple “national” filings through one procedure – it does not constitute an international trademark since any signatory to the WIPO agreement/protocol can reject filings at a national level – and of course, any resultant disputes are dealt with at the national level. A s of June 1996, the trademark conflicts concerning DNS have been limited to US registrants. What will be the result of a trademark conflict between two non-US countries for control of a name in international top level domain space? Which country’s courts will have jurisprudence? Perhaps both will claim it? Conditions of access to international domain names could eventually require mandatory dispute arbitration through something like Arbitration Center. But on the basis of WIPO’s which laws will such a dispute be adjudicated? The mounting conflicts between trademarks and domain names with global significance will likely lead to increased pressure for a global trademark system.


There certainly do not appear to be any. F rom my prospective the only clearly way to avoid conflicts is the proper preparation of trademark searches prior to the adoption and use of either a trademark or a domain name. In this regard we strongly recommend you visit TMWeb. [1]This is the only secure site on the net to conduct trademark searches. Q uestions and comments on this subject can be directed to the author [15]