Introduction to Trademarks and the Internet
Trademark rights are effectively regional in nature. That is, one can only assert his or her rights against another using a same or similar trademark (or “mark”) likely to cause consumer confusion. Traditionally, consumer confusion resulted from mor e than one company using similar marks within the same geographical area. For instance, where two companies sold competing products in the same state, usage of similar marks would likely lead to confusion; however, confusion would not result where the companies were thousands of miles apart. Similarly, courts of regional jurisdiction allow trademark disputes to be resolved only in districts with sufficient contacts with the transaction or parties.
In recent years, however, the Internet has served to diminish the divide between regional markets. Although consumers have traditionally been exposed to products only within their own market (newspaper, localized television ads, etc.), the Internet has bridged the gap between local and national. As a result, trademark law has had an exceedingly difficult time keeping up with the problems associated with Internet technology.
Domain names have caused some of the greatest difficulty for trademark jurisprudence—enough so that the law has developed a new doctrine called “cybersquatting” to combat the problem. Additionally, metatags have been used to direct traffic to unrelated sites and keying has given competing firms the opportunity to advertise on the same web pages as their competitors. As a result of new challenges in technology, trademark law is just trying to keep up. Here I will discuss some of the key issues associated with Internet technology and trademark jurisprudence.
Introduction to Domain Names
The Internet links millions of individual computer servers through telecommunication lines. In turn, each server has a unique address, referred to as its “domain name.” Domain names are a popular battleground for competing commercial interests. Firms compete over domain names because they effectively serve as designations of origin—the principal attribute of trademarks. It is not surprising that so many lawsuits have resulted from the use of deceptive domain names since commercialization of the Internet in 1992.
Cybersquatting and Leverage
Cybersquatting has been defined as registering or using a domain name with intent to profit from the goodwill of a trademark belonging to another. In essence, the cybersquatter uses the domain name as leverage against a trademark holder to induce them to buy the domain name. For instance, a cybersquatter may register the domain name Nikeshop.com in an effort to sell the domain to Nike®. Although the squatter’s use of Nikeshop.com likely constitutes trademark infringement, the cost of litigation often forces companies like Nike® to succumb to the squatter’s demands. Although there have been numerous attempts to combat the problem, including the development of a new trademark doctrine, continued attempts have not extinguished the incentive to cybersquat because leverage in terms of litigation costs still exist.
A metatag is a line of coding that contains data about a webpage. Although the tag is not visible to consumers, it serves as a means to direct traffic to a given site by describing the sites content. For instance, where a web builder uses the metatags “coca-cola, coke, enjoy coca cola, life begins here,” it is likely that a consumer searching for Coca-Cola will stumble upon the web builder’s site. Clearly this creates a problem for Coca-Cola, but how does trademark law combat the issue?
Trademark law provides a dilution provision of the Lanham Act entitling famous trademark holders, like Coca-Cola, to rights against non-competing entities. Thus, famous mark holders may have a cause of action for dilution of their brand even where the web site is not a competitor. On the other hand, in the much more likely circumstance that the trademark is not deemed “famous,” mark holders have much more limited rights against bad faith use of metatags. Although bad faith use of metatags may serve to misdirect web traffic, use of metatags ordinarily does not create a likelihood of consumer confusion. The result—trademark holder may be left without an actionable trademark claim against bad faith metatag users using the mark holder’s name to induce greater web traffic.
“Keying” is the practice of buying advertising space opposite search results that use the name of a trademark holder or competitor. For instance, Pepsi might buy ad space opposite Google searches for Coca-Cola. Thus, when a consumer receives his or her search results they will also be unintentionally exposed to Pepsi’s brand.
This practice has caused significant controversy in trademark jurisprudence. Opponents of the strategy argue that trademarks are being used to benefit competitors at the mark holder’s expense. Opponents argue that deceptive keying practices foreclose their ability to purchase ad space opposite their own product. On the other hand, proponents of the practice argue that trademark rights are not implicated in situations where consumer are not confused as to association of competing goods.
Responses to Growing Problems
Although trademark jurisprudence has been slow to adapt to new challenges created by the Internet, there have been some substantial steps in the right direction. For instance, the Internet Corporation for Assigned Names and Numbers (“ICANN”) has adopted what’s known as the Uniform Dispute Resolution Policy (“UDRP”) in an effort to combat cybersquatting. The UDRP allows trademark holders to resolve disputes by arbitration where a registrant uses a domain name that is identical or confusingly similar to the trademark holder’s mark. Similarly, common law decisions by the courts have embraced new legal concepts in an effort to combat the challenges mark holders face from Internet technology. For instance, the Ninth Circuit Court of Appeals in Playboy Ent., Inc. v. Netscape Comm. Corp., 354 f.3d 1020 (9th Cir. 2001), held in favor of trademark infringement where Playboy argued Netscape had used unlawful keying practices to direct consumers searching “playboy” to other adult-oriented web sites.
Although trademark jurisprudence and corresponding legislation has responded amicably to new issues arising from Internet technology, there is still a great deal to be done. Thus, the continuing gap between trademarks and technology begs the question, “will trademark law ever be able to catch up?”