E Practice

Are Smartphones Making Jurors Smarter?

In 2008, the number of people using mobile devices to access news and information on the Internet has doubled. At the same time the use of smartphones, such as the Blackberry or the iPhone, for social networking and blogging has increased 427%. The proliferation of smartphones is definitely benefitting consumers who have better mobile Internet access and mobile applications. However, the recent expansion of smartphone use is also making its way into the courtroom and deliberation room through use by jurors, and this intrusion is not pleasing everyone, especially not judges and lawyers. The problem has become so prevalent that judges are sometimes forced to declare mistrials in cases where jurors have been using smartphones during trial and deliberation.

Jurors are supposed to decide cases on the facts presented to them, and are not supposed to seek any outside information. But recently, some jurors have been violating the evidentiary rules that prevent inappropriate or prejudicial information from reaching the jury. In a recent Arkansas civil trial, a building products company asked the court to overturn a $12.6 million judgment because, it claimed, a juror had sent updates to a Twitter posting during the trial. Similarly, a juror in a federal corruption trial updated his Twitter posting, saying that a “big announcement” was coming.

What seems more alarming is how easily jurors can access outside information. A juror on a break could very easily use a phone to access otherwise restricted information about a defendant, access news reports about the case, or even use Google Maps to revisit the scene of an accident. Moreover, even if jurors’ phones were to be confiscated, nothing would stop a juror from using a home computer for these extra-curricular activities, unless the jury is sequestered.

This extra research has resulted in some interesting solutions. For example, on March 23, 2009, United States District Judge Moreno, Chief Judge for the Southern District of Florida, responded to this problem with a new administrative order barring all cell phone use . The order also states that a violation of this order will result in contempt of court. This new order comes less than year after Chief Judge Moreno issued an order allowing cell phone use in court rooms. In addition, attorneys have now begun to monitor jurors’ postings and websites. While these restrictions and extra monitoring may lend some help in catching wayward jurors, another, possibly more effective method is to encourage jurors to self-police themselves. As the theory goes, if self-policing can contain the violation to one person, then only one juror has to be replaced, rather than declare a mistrial which can greatly increase the cost of attorneys, clients, and the judicial system to retry the case. But, as the number of customers buying smartphones increases, the problem of jurors with outside information will most likely increase as well.

Bill Proposal Could Force Internet Users to Keep User Records

Two recently introduced bills in both the U.S. House and Senate could force Internet service providers (“ISPs”) to keep records of their uses for up to two years. Senator John Cornyn, a Texas Republican, introduced the S.436 bill in the Senate on February 13, 2009 while Representative Lamar Smith, also a Texas Republican, introduced HR 1076 in the House of Representatives on the same day. Both bills are entitled “Internet Stopping Adults Facilitating the Exploitation of Today’s Youth Act” and attempt to address the same social concern – protecting children online.

The bills, if passed, would require ISPs and additionally, Wi-Fi providers to keep records on users for two years. This requirement, as supporters of the bill argue, would help law enforcement officials help track down users accused of violating child pornography laws. Supporters liken the proposed requirement to phone companies keeping records to aid law enforcement officials in pursuing predators. Upon closer inspection of the bills’ language, though, this proposal would also require home users and small businesses that operate their own wireless network to keep records of users even if the network is password protected. This additional requirement is what has caused privacy advocates to oppose the Act.

Opponents of the bills argue that the proposed measures would unnecessarily put users’ information at risk for theft, fraud, and civil liability. One such group, the Electronic Frontier Foundation (“EFF”), has taken legal steps to stop the government from conducting what it argues would be a domestic spying program. The group argues that requiring ISPs and everyday users to keep records on its users would create a vast aggregation of information easily vulnerable to government abuse and anyone with a subpoena. In addition, EFF argues, it could threaten the privacy and anonymous freedom of speech rights.

In addition to the potentially increased burdens on ISPs and other providers of Internet services, ISPs are now worried about increased liability as well. According to one section of the Act, anyone who “knowingly engages in any conduct the provider knows or has reason to believe facilitates access to, or the possession of, child pornography” will be fined or imprisoned for no longer than ten years. This language could effectively make it a crime to provide such services as email, cloud-computing, and social networking tools because they could be viewed as conduct that facilitates these illegal activities.

However, the concerns expressed by opponents of the Act might not even be necessary to defeat the bills in their tracks. As the bills stand now, only Republicans are pushing these proposals, with no Democratic co-sponsor in either the Senate or the House. Without the bipartisan support in both houses of Congress, the momentum that these bills currently have could very well be short-lived.

Podcasting and Copyright: Not Everything Is Up for Grabs

Podcasting has become a way for individuals, businesses, and even educators to deliver more information to the public. In the business context specifically, the use of podcasting makes it much easier for companies to provide information on innovations, business generalities, and other aspects not only of each individual business, but of the industry in general. While podcasting is protected by copyright law, specific aspects of podcasting create unique legal situations. See 17 U.S.C. § 102.

Copyright protection applies to podcasting just as it applies to other original works such as art, music, and writing. For instance, a completely original podcast by a business has copyright protection, meaning it cannot be copied without express permission from the copyright holder, or unless the use of the copyrighted material falls under one of the exceptions. However, using the current business model today, the business or individual is interested in reaching as many consumers as possible, and often uses RSS (“Really Simple Syndication”) feeds. RSS feeds are basically a method of syndicating the material. But does RSS basically give users a license to use the material? Not quite, according to Creative Commons, a nonprofit organization that works with artists and others to make navigating the ins and outs of copyright laws less of a headache. In its own series of podcasts, Creative Commons discusses the limited uses of syndicated material. However, even syndicated material remains controversial, as the Associated Press continues to sue or push to sue blog and online news outlets, such as the Drudge Report, for quoting AP press releases.

Many educators and even businesses (for example, anyone quoting the Associated Press) believe fair use allows the use of any work in podcasting as long as the podcast is for educational purposes, which is woefully short of the real legal doctrine. Educators, specifically, have wide latitude, but they need to understand the limits of that latitude. Under 17 U.S.C § 107, of the Copyright Act, teachers are not liable for infringement if the use of the protected work is for “ teaching (including multiple copies for classroom use).” However, under § 107, in determining whether a use is fair use, the analysis must include the following four factors:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copyrighted work.

Businesses are also using podcasts to educate users as well as market products; therefore, businesses, especially less sophisticated businesses, may assume that its podcast is shielded by the fair use doctrine. If a business does not employ all reasonable precautions to avoid litigation, including determining the limits of fair use, that entity will almost certainly find themselves in trouble. Podcasts can certainly be a valuable tool both in the classroom and in business, but users wishing to implement a program that involves podcasting must be aware of the legal pitfalls before finding themselves in trouble.

Is Username-Squatting the New Face of Cybersquatting?

As if trademark owners did not have enough to worry about, there is yet another reason that trademark owners should consider protecting their brand: username-squatting. Much like cybersquatting, Internet users can register usernames on popular websites to mislead others as to the true identity behind the username. Although it may not be as egregious as registering a cybersquatted domain name, registering squatted usernames can still harm a brand as well as individuals.

On social-networking sites such as Facebook, MySpace, and Twitter, users set up profiles and interact with other users. Registered users can post messages, share pictures, and share videos. These activities seem harmless by themselves, but a not-too-distant-past trend has reemerged that is reminiscent of the early days of the Internet. Similar to the domain name grabs that took place in the mid-90s, users are now registering profiles of famous names and brands, and sometimes sell the profiles back to the rightful owners. This has caused headaches for the rightful trademark owners, and undoubtedly will continue to do so.

A recent target was President-Elect Obama during the 2008 campaign. In July 2008, a member of the Republican National Committee reportedly set up a fake Facebook page of the then-Democratic presidential candidate. A search of the popular messaging site Twitter shows that famous brands such as Coke, Pepsi, and Nike have also already fallen prey to these activities. In an analysis of Twitter usage, out of the top 100 global brands, 58 had no presence, 9 may be controlled by the actual company, 27 are controlled by individuals that likely have no affiliation with the company, and 8 are Twitter protected, though it is unclear who controls the account.

The problem is not limited to famous names and brands. An individual’s name and profile may even be appropriated for legitimate purposes. Can or should an employer create profiles of employees to increase the company’s presence on professional networking sites such as LinkedIn? The best-case scenario is a company that maintains employee profiles in ways that benefit both the company and the employees. However, problems may arise when conflicts occur within the company which may spill over into these sites.

As widespread as the problem may be, there are solutions to these unauthorized uses. Websites such as YouTube allow media companies to make a somewhat lengthy copyright claim to unauthorized postings of content, and to have the content removed. Twitter, on the other hand, seems to have a less formal and more sweeping policy that may cause problems for legitimate users. Twitter reserves the right to “reclaim usernames on behalf of businesses or individuals that hold legal claim or trademark on those usernames.” This language seemingly gives Twitter greater power to police their site, seems to allow more tenuous and feeble complaints to cancel usernames, and could very well result in rightful users losing their accounts. While it does carry the potential for abuse, Twitter’s terms of use policy suggests that it is protecting itself from contributory liability from businesses who are trying to protect their brands. At least one blogger has called for changes in Twitter’s policy, and if more join in, there could be a movement toward a dispute resolution mechanism akin to the one used to resolve domain name disputes.  

Second Life: The Next Frontier for Law

As reported in the March newsletter, Second Life presents the unique situation of a virtual world in which users retain rights in their creations, including both their avatars and any virtual products they create. Section 3.2 of the Second Life user agreement, which reads “ copyright and other intellectual property rights with respect to Content you create in Second Life,” has helped spawn a huge commercial enterprise. In 2007, the first Second Life millionaire emerged, and each year for the last two years, over two hundred million real U.S. dollars have exchanged hands. This explosion in commerce has also presented opportunities for attorneys and law firms. Some estimate that at least two-million dollars worth of trademark infringement occurs each year. In light of this continuing in-world copyright and trademark infringement of both products with cache in the real world, like Ferrari, and products created solely inside of the program for use in the program, how is the legal community reacting to this blending of the new, virtual reality and the real world?

For disputes between Second Life creators, Linden Lab, and its Residents, Linden Lab has created a new policy for dispute resolution. Under this agreement, Residents agree to binding arbitration for any amounts under $10,000 US dollars. Linden Lab’s FAQs on Legal Matters even specifically mention the National Arbitration Forum as a forum for bringing a claim and also uses the FORUM’s pricing. For claims for greater monetary amounts, the Resident must bring suit in San Francisco, California. But due to the ease of filing, binding arbitration is accessible to most, if not all, participants.

Yet, that policy does little for residents with claims against other residents, or for corporations with claims against residents. Individual residents began to see problems almost immediately, and ad hoc dispute resolution mechanisms began to grow. But these small groups were difficult to find, had little training, and often were not neutral. Now, attorneys and mediation groups are starting to move into Second Life. The Portuguese Ministry of Justice began a mediation and arbitration site in Second Life in 2007; the site was active at least into February 2008. The second major group entering the legal arena of Second Life is the Second Life Bar Association (“SLBA”). The SLBA provides an in-world location in which to lodge legal complaints. The SLBA is currently attempting to encourage other legal professionals to “rent” space and provide services. There is also a Second Life Patent and Trademark Office. And Linden Lab also seems likely to welcome other in-world arbitration centers to conduct virtual mediations and arbitrations.

But should someone care about the legal ramifications of what is basically a virtual reality game? For corporations, virtual reality infringement likely carries more real repercussions than they believe it could. The problem of trademark dilution may filter from the virtual world into the real world if Second Life becomes prevalent in ordinary consumers’ lives. In other words, if corporations do not actively defend their trademarks in the virtual world, they may find themselves in a weakened position in the real world. For Residents, the in-world disputes are real, and the law should be available to help resolve their disputes. However, the courts have yet to test the jurisdictional waiver in the user agreement and no one has yet reconciled the apparent dichotomy between a user’s rights to intellectual property and Second Life’s retention of rights in the Section 3.3 of the user agreement, which seems to subordinate a user’s rights to those of Linden Lab.

As the popularity and population of virtual environments expands, so too will the frequency of legal conflicts. The availability and use of virtual arbitration will likely be a great tool in solving these disputes.

Are Ad Providers Legitimately Profiting from Typosquatting? 

Benjamin Edelman, an assistant professor at the Harvard Business School, claims in a report that Google has been profiting from advertisements placed on websites that correspond to a typosquatted domain name.  Professor Edelman, who is also a participating attorney for the plaintiffs in a class action suit, Vulcan Golf, LLC v. Google, estimates that Google charges every advertiser between $32 and $50 a year by placing its AdSense ads on an estimated 1 million typosquatted sites.  Users who are redirected to the typosquatted sites click on these ads and generate revenue for both the domain name owner and Google.  Plaintiffs in the lawsuit include American trademark holders targeted by typosquatters.  The lawsuit names as defendants not only Google, but several other large typosquatting ad providers as well.  A larger issue is that Google offers a special version of AdSense, named “AdSense for Domains,” which specifically targets parked domain names. 

 If Google loses, it could be held liable for assisting typosquatters in violating the Anticybersquatting Consumer Protection Act (“ACPA”).  In 1999, the ACPA made typosquatting illegal in the United States.  Typosquatting is a practice that takes advantage of the mistyping of a domain name into a web browser.    In a 2002 case decided under the Uniform Domain Name Dispute Resolution Process (“UDRP”), the panel further described typosquatting as “tak[ing] advantage of common typing errors in order to divert Internet users unwittingly to for profit websites unassociated with the business or entity the Internet user was attempting to reach.”  Samsung Elecs. Am., Inc. v. Photo Center, FA 122206 (Nat. Arb. Forum Oct. 17, 2002).  This use of another’s trademark is illegitimate because the typosquatter obtains a windfall by usurping the goodwill associated with the trademark.  Additionally, this practice creates the impression that the business the Internet user intended to reach is affiliated with the alternative website when in fact it is not.  The panel in Samsung accordingly found that typosquatting evidenced bad faith registration and use on the respondent’s part.  The ads on these alternative websites are provided by other companies, such as Google, and are the point of contention in the recent lawsuit filed against Google.

The result of this suit could have a substantial impact on the practice of typosquatting with regards to third party ad suppliers.  A decision against Google may force third-party ad suppliers to tighten up their current client roster and implement new research and clearance steps designed to limit trademark infringement into the process of obtaining new patrons.   Thus, the advertising generated monetary incentive to create a typosquatted site would likely decrease, which in turn could decrease the number of typosquatted sites.  However, Google attorney Maria Moran says, “[Google] has no way to know -- and no reason to know -- whether a given domain in the [AdSense for Domains] program could infringe a valid trademark…  And even if Google did somehow have the ability to pluck out those domains which could infringe a valid trademark, Google has no way to know who has registered the domain, be it an infringer, a licensee of the trademark owner or the trademark owner itself.”  From Google’s point of view, third-party ad suppliers are merely distributors that cannot be held responsible for knowing what is and isn’t a valid trademark (let alone who the trademark belongs to).  Forcing the obligation of requiring such knowledge onto ad suppliers like Google, Yahoo! and Sedo may be seen as burdening the inappropriate party.   

Both sides present legitimate arguments.  For Edelman and the plaintiffs, “[t]he law simply says, ‘do not typo-squat.  Do not register, traffic in or use infringing domain names or confusingly similar names of trademarks."  Inducing or assisting someone in breaking the ACPA is simply not acceptable.  However, requiring what may amount to be full trademark searches before third-party ad suppliers can work with websites, which are relatively inexpensive to register, may be too overly burdensome to be realistic for the market.  Whatever the outcome of this case, it will have to balance the competing demands of both the e-commerce market and the trademark owner’s rights.

Hidden Metatags: Evidence of Bad Faith? Judges and Panelists Disagree

Website owners and designers utilize metatags to present their websites to Internet users searching for certain keywords in a search engine.  A metatag is a “special HTML tag that is used to store information about a Web page but is not displayed in a Web browser.  For example, metatags provide information such as what program was used to create the page, a description of the page, and keywords that are relevant to the page.  Many search engines use the information stored in metatags when they index Web pages.”  Website owners may add metatags containing keywords describing their products or competitors’ products to attract Internet users searching for similar products.  Problems develop when owners add metatags comprising the trademarks of third-parties.  Although an Internet user may not see the use of the third-party trademark, the use of the metatag will cause the website to be displayed as a search result when the user runs a query in a search engine, such as Google, for the third-party’s trademark.

Courts and administrative panels around the world are now forced to deal with the issue of whether or not utilizing a metatag containing a third-party’s trademark constitutes bad faith (in a UDRP proceeding) or trademark infringement when only the Internet user’s computer has “seen” the third party’s trademark and not the actual user. 

In the United Kingdom, in rejecting a lower court’s argument of infringement, Lord Justice Jacob held that, “[a]ssuming metatag use counts as use of a trade mark, there is simply no confusion here.  I confess to not following the [lower court] Judge's reasoning on the point. He said that the 'ultimate purpose [of the metatag] is to use the sign to suggest a connection which does not exist.'  But purpose is irrelevant to trade mark infringement and causing a site to appear in a search result, without more, does not suggest any connection with anyone else.” 

On the other hand, in a 2003 UDRP decision from, the panel held that “[t]he use of the metatags incorporating the Complainant’s trademarks to misleadingly attract persons searching the web for information on Complainant’s products and services to Respondent’s website as opposed to a legitimate complaint website is evidence of use in bad faith.”

In a leading United States 11th Circuit Court of Appeals case, the court relied less on the argument that the use of metatags showed a likelihood of confusion, and more so on the argument that the use of metatags constituted a “use in commerce,” which is also part of the trademark infringement standard.  Because metatags are used primarily to promote a website in the context of a search engine’s rankings, and because the defendant used the plaintiff’s mark in its metatags, the defendant therefore used the plaintiff’s marks abusively in commerce.

Some articles suggest tips for website owners to avoid creating a likelihood of confusion while still utilizing third-party marks.  One suggestion is to “consider including a prominent disclaimer or other wording on the website which makes it clear to web users that the trade marks are the property of the trade mark owner and that the website is not affiliated with, sponsored by or approved by the trade mark owner.”  However, this suggestion would do nothing to avoid initial interest confusion.  Another suggestion is to just avoid third-party trademarks altogether or obtain permission from trademark holders. 

On a related note, courts have relieved the fears of many advertisers and search engine providers by acknowledging the legitimate use of displaying third-party trade marks when Internet users search by those marks.  In 1-800-Contacts, Inc. v. Whenu.com, Inc., a pop-up advertisement case, the 2nd Circuit Court of Appeals held that “[a] company’s internal utilization of a trademark in a way that does not communicate it to the public is analogous to a [sic] individual’s private thoughts about a trademark.  Such conduct simply does not violate the Lanham Act, which is concerned with the use of trademarks in connection with the sale of goods or services in a manner likely to lead to consumer confusion as to the source of such goods or services.”

For the moment, it seems that pop-up ads are safe from being held liable for trademark infringement in the Second Circuit; however, using another’s trademark to place your website next to theirs may still constitutes an improper use.  Yet the question remains: if your website is competing for customers, isn’t it fair use to identify the competing good or service in this manner?  As with most inquiries into fair use, the answer to this question may differ from case to case. 

Patching the Potholes When a Repaving Is In Order: DNS Security Extensions and the Recent DNS Security Flaw

A recently publicized security flaw in the Domain Name System (“DNS”) protocol had security experts scrambling these past few months to patch the hole.  Dan Kaminsky, a director for the security firm IOActive, discovered the problem earlier this year and has since met with top security experts from Microsoft, Cisco, and Sun Microsystems to quietly come up with a solution. 

DNS is the system that translates a website’s domain name into its corresponding IP address, which is then used by Internet infrastructure to transport information from one user to another.  When a user types in an Internet address, the user assumes that the DNS will correctly take the user to the correct server identified by its IP address.  However, a DNS server does not always know how to translate every domain name into its corresponding IP address; so it asks for help from another DNS server by sending out a request and receiving a response with the correct translation thereby establishing a relationship by saving or “caching” the translation.  The problem, although not officially disclosed to allow Internet Service Providers (“ISPs”), consumers, and businesses to patch the problem, has been speculated to be a form of “cache poisoning,” which can be explained as sending a fake response to a DNS server’s translation request.  One such scenario involves an attacker intercepting a translation request and sending a fraudulent response thereby establishing a fake relationship based on a false translation.  Using this example, when a banking customer types in the bank’s Internet address, the customer is rerouted to the attacker’s site, a site which could very well be made to look exactly like the genuine site.  An attacker could then obtain the customer’s personal information.  While this flaw is a serious problem, experts advise users to check with their ISPs and operating system vendors, like Microsoft or Apple, and update their PCs with the latest security update.

Unfortunately, attempts to keep the details of the flaw as secretive as possible until users could update their systems have failed as hackers have caught on to this critical flaw and have used it as an attack.  Experts recommend that users update their systems as soon as possible.  In addition, Kaminsky has provided a tool on his website that allows users to check if their ISPs or employers have updated their systems.

Meanwhile, a broad solution to this flaw has been in existence for years, but has been slow to implement due to technical and political issues; the biggest of which is obtaining approval from the United States Department of Commerce.  DNS Security Extensions (“DNSSEC”) is a means of ensuring the validity of information return when resolving a domain name by using digital signatures and public key encryption.  Basically, it ensures that the aforementioned “translation” is correct by checking the digital signature from a proper authority.

In late July, the Internet Corporation for Assigned Names and Numbers (“ICANN”) released a paper articulating its readiness for DNSSEC signing.  In its paper, ICANN calls for the DNSSEC signing of the DNS root zone.  The DNS root zone, managed by the International Assigned Numbers Authority (“IANA”), is the top level in the DNS hierarchy and its database represents “the delegation details of top-level domains,” including generic top-level domains (“gTLDs”) such as “.com” or country-code TLDs “.us.”  ICANN asserts that “if the root zone is DNSSEC signed, DNSSEC deployment beyond the root zone remains optional.”  Thus, according to ICANN, a DNSSEC signed root could effectively secure the rest of the DNS hierarchy through a seemingly trickle-down effect.

In the end, perhaps this current DNS scare can be a wake-up call to many to look at their security more closely.  Perhaps it will fast-track the deployment of DNSSEC.  In the meantime, a patch seems to do the trick, while in the long run, DNSSEC seems to be the right solution that is long overdue.

The Final Frontier: ICANN’s gTLD Expansion May Provide New Opportunities

Domain name registrants have long desired greater flexibility in consumer choice and market differentiation, especially beyond the commonly known generic top-level domains (“gTLDs”) of “.com,” “.net,” and “.org.”  As such, gTLD expansion has been in development for over three years, headed by the Generic Names Supporting Organization (“GNSO”), which is a subcommittee of the Internet Corporation for Assigned Names and Numbers (“ICANN”).  On June 26, 2008, ICANN affirmatively voted to expand the array of gTLDs that can be registered.  Considerable debate has surfaced concerning the underlying advantages and disadvantages of the proposed implementation, which will likely affect businesses and other entities operating on the Internet.

In 2005, the GNSO began exploring the technological and other logistical issues that would be associated with allowing the expansion of gTLDs.  The three main categories of issues included preservation of public order and morality, efficiency of the application process, and trademark protection.  The GNSO addressed these concerns by drafting numerous recommendations that the board of ICANN subsequently approved in its June 26, 2008 vote.

ICANN addressed initial concerns regarding implementation specifications, including content regulation, trademark protection, and the outline of the actual process.  To this end, ICANN drafted a flowchart detailing the proposed registration process, and has stated its hope to begin accepting applications for new gTLDs by the second quarter of 2009.  Moreover, it plans to utilize an objection-based procedure administered through an international arbitration body to deal with proposed offensive and/or trademark-infringing gTLDs.  One notable scenario involves entities with concurrent rights in an identical word trademarks that compete to register a corresponding gTLD.  Under the proposed implementation, this dispute would be resolved through an auction.

ICANN’s contemplation and approval of this expansion has generated substantial discussion in the Internet community.  One of the more prevalent expressed benefits is the potential to reduce cybersquatting given the cost of registering a new gTLD, which could potentially cost up to US $100,000.00 each.  Another issue concerns public morality.  Some believe that a proposed adult-oriented gTLD, such as “.xxx,” would remove such content spread across current gTLDs to one location on the Internet, potentially reducing the difficulties in blocking these websites.  

Opponents of the proposed expansion assert that while the cost may render cybersquatting more prohibitive, the expenses involved would make it more difficult for smaller businesses or entities to employ a defensive strategy with regards to trademark infringement.  If there are more gTLDs, the cost of preemptively registering domain names reflecting an entity’s marks to reduce infringement will increase substantially.  Regardless of an entity’s successful registration of its own gTLD, trademark owners will still be required to monitor domain names that potentially infringe their marks in current gTLDs as well as any newly registered gTLDs.  Many argue that the objection-based mechanism will not be used objectively, and that ICANN will engage in censorship.

Going forward, the Internet community will need to evaluate the benefits and opportunity costs of registering their own gTLDs as that opportunity becomes available through ICANN.  All entities interested in their own gTLD are encouraged to monitor ICANN’s website for future additional information.

Sky-High Aspirations: Cloud Computing May Benefit Internet Content Storage

Given the exponential worldwide growth of the Internet and the vast arrays of information therein, those depending on the Internet seek to archive and store its web pages for future use.  Both the sheer size of computing power required to process the storage and retrieval of Internet content as well as potential legal issues are significant considerations.

Internet Archive is one of the most well-known online storage vehicles.  This organization stores many expired or replaced web pages in an attempt to preserve Internet content, given the finite capacity of host computers, thereby creating an Internet “library.”  Internet Archive’s storage tool is named the WayBack Machine, which currently holds over 85 billion web pages dating as far back as 1996.  Such data storage provides many people with numerous benefits, including historians and scholars conducting research; marketing consultants studying the layout and efficiency of previous website incarnations; patent searchers examining others’ innovations; and companies scrutinizing the business plans of other organizations within their industries.

Numerous companies—most commonly journalistic sources—have utilized Internet archiving.  For example, the Los Angeles Times, Chicago Tribune, Washington Post, and New York Times have sizable archive features for past newspaper content.  In an attempt to set itself apart, the New York Times recently unveiled its newest archival tool: the TimesMachine.  This feature offers print subscribers the opportunity to view historical Times articles dating back to the years 1851-1922, while non-subscribers can peruse a sampling of these articles (pieces post-1922 are still available in the original online archives).  While the move may not be monetarily beneficial to the Times’ bottom line, the creators are hopeful that the able to be browsed interface and unlimited access for subscribers will cater to those curious about historical news and advertisements, and retain current customers.

One of the main dilemmas that hindered Internet archiving was the cost of operating and housing the necessary server and computing power.  The concept of “cloud computing,” which may be defined as utilizing the vast processing power of a network akin to a supercomputer, seeks to fill this void in insufficient infrastructure.  Cloud computing, originally designed to harness supercomputers for sophisticated calculations, is providing new opportunities for everyday businesses to store their data.  Several well-known Internet companies, such as Amazon and Google, currently assist businesses seeking these ends.  WebCite assists in archiving scholarly or reference materials, while ProQuest caters to the newspaper industry.  Recently, Apple announced a cloud computing program for Apple computers, iPhones, and other Internet devices.

Other potential drawbacks to archiving include copyright issues, which were the subject of legislation presented to the Canadian Parliament in 2005.  The bill proposed banning caching or archiving copyrighted web content.  There are also questions concerning the ability of the U.S. government to subpoena archived items.  The publicized incident with Internet Archive in 2007, which received U.S. Senate attention, is illustrative of this issue.  Companies must also consider the technical limitations, such as outages, computer connectivity, and data protection.

Moreover, website owners may wish to avoid having their web content picked up by automatic web crawlers.  “Robots Exclusion Protocol,” commonly called “robots.txt,” may provide some level of privacy by defining what parts of a website are off-limits to web crawlers.  However, businesses should be cautioned as some UDRP panels have found that, absent convincing justification for robots.txt usage, they represent “an indicia of bad faith [in UDRP cases].” Moreover, the U.S. District Court for the Eastern District of Pennsylvania recently ruled against a company suing over the apparent technical failure of the Internet Archive to block access to its web pages during litigation via a robots.txt file.  The Court stated that the opposing law firm’s ability to view the web pages due to the technical error was not unlawful.  Parties should therefore avoid placing undue trust in the efficacy of these devices.

In the end, it appears that the trend of large-scale Internet storage and archiving will become more common, especially as network and computing power is consolidated and expanded.  While there are considerable drawbacks in the legal and technical realms, there is little doubt that businesses will continue to scrutinize the utility of Internet storage for improving marketability and efficiency.

Hit the Road, Brandjackers … Protecting Your Company’s Brand

In June 2007, e-Practice first reported on the new phenomenon of “brandjacking,” and this topic has received increased attention over the past year.  Generally, brandjacking refers to “the criminal act of hijacking strong brands for profit.”  MarkMonitor, a leading company specializing in online brand protection, began releasing a Brandjacking Index in 2007, where it specifically defined the term in the report’s glossary as, “[t]o hijack a brand to deceive or divert attention; often used in abusive or fraudulent activities devised for gain at the expense of the goodwill, brand equity, and customer trust of actual brand owners.”  MarkMonitor has continued to track brandjacking in 2008 and has also released quarterly reports discussing its findings.

Initially, brandjacking efforts were directed at the pharmaceutical industry, attempting to mislead consumers as to the origin and validity of drug prescriptions.  However, recent trends suggest that brandjacking has expanded to new industries, especially those concerning general consumer goods, including automotive, food and beverage, and consumer packaged goods.  However, industry analysts worry it could expand to other areas, as has already happened to Gucci, Toyota, and Disney.  Even large retailers such as Wal-Mart, Target, and Toys R Us were concerned during the holiday season about brandjackers diverting business to fraudulent retail sites.  According to Rose Ryan, a research analyst at the market intelligence and information technology firm IDC, “[p]rotecting brand reputations, customer relationships and revenues from online abuses is becoming as important to enterprises as securing their networks, data and systems from Internet-borne threats.”

MarkMonitor’s Winter 2007 Brandjacking Index shows that companies are starting to fight back.  It reports that Microsoft, Dell, and Verizon all initiated highly publicized lawsuits to protect their brands.  According to Ihab Shraim, MarkMonitor’s chief security officer (CSO), these lawsuits should encourage CSOs to work with the General Counsel’s office to be “vigilant about protecting their brands and their customers against evolving threats.”  The report also notes that online industry leaders such as Microsoft, Yahoo, and Google are taking preventative measures by altering their pay-per-click advertising programs.  In fact, Microsoft has initiated a multi-million dollar global outreach program to provide news networks with the information necessary to inform the public about how to combat general cybersquatting, including specifically brandjacking.

So, how can a business protect its brand?  An article from the American Bar Association recommends registering your brand name in as many ways as possible, including as a trademark, within domain names (containing both top-level domains as well as country-code domains), and by purchasing relevant keywords on Google and Yahoo.  Ihab Shraim recommends internal education programs for employees and increased marketing efforts for customers in order to publicize your brand and expose abuses more easily.  In addition, Microsoft offers products and services that empower a company to self-patrol for cybersquatters, including the Strider URL Tracer that searches for typosquatted versions of an existing domain name.  Companies can also enlist the help of online security providers that specialize in protecting brands, including Net Enforcers, Brand Intelligence, CitizenHawk, PBP, CSC, and MarkMonitor. 

Simple Searching: Direct Navigation Creates Advertising Opportunities

The concept of direct navigation has existed as long as the Internet has reached consumers’ homes, but it is quickly becoming an intricate part of a novel advertising approach.  Direct navigation refers to the concept of bypassing online search engines and simply utilizing the website address bar to reach a desired Internet destination.  So-called “type-in traffic” is one form of direct navigation, wherein Internet users type a desired category or search term in the address bar and add a generic top-level domain (“gTLD”) such as “.com.”  For example, Internet users seeking candy may enter “candy.com” in their address bar and wind up at a website that features lucrative pay-per-click advertisements.  While previous reports found that only 17% of Internet users chose this method, one recent survey noted that almost 64% of Internet users are using direct navigation in their Internet browsing. 

Investors seek to capitalize on the use of direct navigation by registering generic domain names that match Internet users’ direct navigation searches.  This industry likely started back in 2004, when Marchex paid over $164 million for 100,000 generic domain names.  Other companies then emulated the approach.  NameMedia, a commercial website owner, raised $120 million in financing in order to develop a portfolio of over 725,000 websites.  Kelly Conlin, NameMedia’s chief executive, noted that “what [NameMedia] wanted to do, quietly, is amass the largest real estate position on the Internet, which we feel we have.”

But is this venture profitable?  Mr. Conlin admits that direct navigation “is seldom fruitful for users…[a]n obscure Web address may have four or so visitors a month, and perhaps half will click on an ad.  But if you have hundreds of thousands of those, it adds up."  Others have criticized the approach regardless of volume, citing that the expense of registering generic domain names and the time of building traffic is not worth the effort, especially given the current profitability of purchasing normal online advertisement space. 

Potential registrants should be cautioned, however, to avoid domain names that would incorporate identical or confusingly similar forms of trademarks held by third-parties.  By conducting a search on the United States Patent and Trademark Office’s website, a potential registrant can determine whether a trademark application or registration would preclude purchasing a domain name incorporating that mark.  Correspondingly, Uniform Domain Name Dispute Resolution Policy (“UDRP”) panels have found that registrants have rights and legitimate interests in their domain names when they are solely comprised of generic words.

Finally, businesses seeking to take advantage of direct navigation must consider many factors when determining which domain names to register, such as keyword relevance, traffic, and top-level domain choice.  Business owners may find it interesting to weigh the potential gains of advertisement revenues from generic domain name acquisitions with the more traditional approach of sale space purchases.  In either regard, the use of direct navigation does not appear to be waning, and should merit continued attention from the marketing and advertising industries in the months and years to come.

EV SSL Certificates Aid Businesses in Combating the Threat of Phishing Attacks

In this age of Internet commerce, there are many data security concerns, not least of which are the rise in "phishing" attacks. Phishing occurs when third parties attempt to fraudulently obtain Internet users' personal or confidential information, such as bank account or social security numbers. These third parties often seek to capitalize on Internet users whom have inadvertently misspelled a domain name and are subsequently diverted to a fraudulent website that mimics a legitimate website's characteristics. In light of this danger, Extended Validation Secure Socket Layer ("EV SSL") certificates have drawn increased attention in the Internet security spotlight, especially in an attempt to prevent phishing attacks.

Secure Socket Layer ("SSL"), sometimes referred to as "Transport Layer Security," is an Internet protocol which essentially allows the server and the Internet user to ensure that all communication between the two remains private and authentic. SSL certificates refer to the identity authentications sent between the server and Internet user. Thus Extended Validation SSL certificates represent the next generation of these protocols, designed to augment website and Internet communication security.

A survey by Netcraft notes that the use of EV SSL certificates as a method to enhance consumer confidence in e-commerce has seen steady and substantial growth over the past year. However, it is interesting to note that three of the five websites that have used EV SSL certificates for one year were themselves operated by certificate authorities. Nonetheless, several financial institutions, including an Internet bank and an online tax filing service, now utilize this technology to foster trust and confidence with Internet customers. Even non-financial organizations such as Scribendi Inc., an online editing service, have begun utilizing the EV SSL certificates as a way to bolster the confidence of authors, screenwriters, and academics, when entrusting their intellectual property with the Internet company. Terry Johnson, Scribendi's vice president of technology, noted that after implementing EV SSL certificates, Scribendi's conversions went up 27 percent.

Several major Internet browsers have released updates to better accommodate the use of EV SSL certificates. Microsoft has signaled that Internet Explorer 7 recognizes EV SSL protection. Mozilla Developer Center has also announced that the latest edition of its Firefox web browser will utilize the certificates to protect its Internet users.

EV SSL certificates are obtainable through VeriSign, Comodo, GlobalSign, DigiCert, and numerous other Internet security providers. Once acquired, the EV SSL certificates will cause the address bar within an Internet browser to light up green, indicating to Internet users that they have indeed reached their desired website, and not a fraudulent imitator. Businesses of all kinds may find that this latest effort will not only protect current client information and improve confidence in Internet operations, but also attract new customers seeking assurances of web-based transactional security.

Domain Name Front Running at the Forefront

Domain name front running has been a very hot topic over the last few months. The November 2007 volume of Domain News first reported on ICANN's investigation of front running, whereby domain name search queries are tracked and the most sought-after domain names are opportunistically registered by others before the searching individual has a chance to do so. In effect, the front runners block searching individuals from registering their preferred domain names and then attempt to induce these searching individuals to pay an amount greater than the costs of registering in exchange for transferring the domain names. The ICANN Security and Stability Advisory Committee (SSAC) considers this procedure threatening to the open availability and marketability of domain names and in October issued an advisory warning alerting Internet users of this practice.

To address this concern, Network Solutions, one of the leading domain name registrars, added a customer protection measure in which it reserves domain names searched for on its website for a period of four days to prevent others from opportunistically registering these domain names. However, ICANN and others in the industry characterize the protection measure itself as front running, and claim that Network Solutions is attempting to monopolize the market by forcing customers to purchase these reserved domain names exclusively through Network Solutions at prices set higher than market value. Jonathon Nevett, Vice President of Policy at Network Solutions, responded by stating that this measure was intended to curb domain tasters, who register domain names during a five-day grace period based upon their expected popularity and thus constitute the largest segment of front runners. Nevett also indicated that the measure is meant to give Internet users assurances that they will be able to register their preferred domain names after searching for their availability.

Some industry analysts considered Network Solutions' practice to be fraudulent, and may even constitute theft. In addition, according to ICANN executives, Network Solutions initially admitted that its procedures were not in compliance with the Registrar Accreditation Agreement (RAA). However, Network Solutions has since amended its measure to ensure legality and compliance.

Nevertheless, at a January 23, 2008 meeting, ICANN's Board of Directors passed resolutions aimed at preventing domain name front running by Network Solutions or any other entity, as well as preventing domain tasting in general. (See Items 5 and 6 in ICANN's meeting minutes.) Specifically, ICANN is considering eliminating the five-day grace period (commonly referred to as the "Add Grace Period," or AGP) by imposing its standard annual fees for registering a domain name for any period of time. If this proposal is passed, Network Solutions will cease implementing its customer protection measure, according to Susan Wade, a spokeswoman for the company.

ICANN will continue to discuss, and potentially vote, on whether to implement this change to the RAA at upcoming meetings. In the mean time, registrars will continue to try and find ways to curtail domain name front running, tasting, and other improper procedures.

Tips for Changing a Domain Name Without Losing Internet Traffic

There are many different reasons why people may need to change their domain names. Companies may want to re-brand their products, resolving websites may outgrow their capacities, or domain names may be found to be infringing upon the trademark rights of others. Regardless of the reason, domain name registrants will likely be concerned with losing Internet traffic upon transitioning to the new domain name.

Google, one of the primary online search engines, uses a ranking system that determines how prominently a website is featured in search engine results pages (SERPs). The higher the ranking, the more Internet traffic is typically routed to that website. (Click here to see how your website ranks.) Domain names influence these rankings, and a few leaders in the industry have provided helpful suggestions on how to maintain or quickly gain back high rankings when transitioning to a new domain name.

Jill Olkoski, owner of Aldebaran Web Design in Seattle, changed domain names in 2007 and reported on her findings. After changing over to the new domain name in mid-May, Internet traffic to her website initially plummeted. However, the website's Google ranking quickly returned to #7 overall in mid-June. Ms. Olkoski identified one of the keys to her success as promptly updating the Google sitemap file of her new domain name to help Google find the "new" content posted to the resolving website.

Ross Dunn, founder and CEO of Stepforth Search Engine Placement Inc., also recommends registering the new website with Google Webmaster Central as soon as possible, and issuing a widespread press release that emphasizes the new domain name. Giving Google more advanced notice of the change will help decrease the potential loss of Internet traffic.

Many registrants will want to redirect Internet users from the previously-used domain name to the new one. An efficient way to do this while attempting to maintain search engine rankings is to use a 301 redirect. In fact, Internet users can redirect "non-www" Uniform Resource Locators ("URLs") to "www" URLs using a 301 redirect in order to collectively maximize the popularity of the corresponding website.

However, Scottie Claiborne, owner of the search engine optimization company Right Click Web Services, encourages registrants who want to redirect their websites to initially use a 302 temporary redirect so that the original URL remains in Google's index. This allows the original website rankings to remain intact during the transition. Once the new domain name builds its rankings through the redirections, it will be featured prominently in SERPs and registrants can change to a 301 permanent redirect.

Changing domain names is often difficult and requires many steps, but the potentially negative implications can be kept under control if the transition is managed efficiently.

Legislation Requiring Sex Offenders to Register Electronic Information Moves Ahead

As Internet social networking continues to expand, parents' safety concerns are growing. While popular websites like Facebook and MySpace provide children with opportunities to communicate with friends, abuses of these services have been well-documented. Consequently, these social networking companies are taking additional measures to ensure children's safety, specifically from sex offenders. In December 2006, MySpace began working with a background verification company to develop software that helps identify MySpace accounts held by sex offenders. By late July 2007, MySpace reported that it had identified and deleted 29,000 such accounts.

MySpace has also lobbied for legislation to assist in its efforts, and the federal government has actively undertaken this initiative. Currently, all convicted sex offenders are required by statute to register their names, DNA samples, fingerprints, social security numbers, and work and home addresses with the federal government. In January 2007, Rep. Earl Pomeroy (D-ND) and Rep. Paul Gillmor (R-OH) co-sponsored and introduced a bill in the House of Representatives entitled the "Keeping the Internet Devoid of Sexual Predators (KIDS) Act," which requires sex offenders to register their e-mail addresses and instant messaging ("IM") names. In February 2007, Rep. Melissa Bean (D-IL), another co-sponsor of the KIDS Act, introduced a second bill entitled "Safeguarding America's Families by Enhancing and Reorganizing New and Efficient Technologies (SAFER NET) Act of 2007," which calls for a national education campaign on Internet safety. In October 2007, Rep. Debbie Wasserman Schultz (D-FL) introduced a third bill entitled "Providing, Resources, Officers and Technology to Eradicate Cyber Threats (PROTECT) to our Children Act of 2007," which provides resources for tracking sex offenders online. On November 13, 2007, all three of these bills were approved in the House of Representatives and sent to the Senate for review.

In February 2007, Senator John McCain (R-AZ) and Senator Charles Schumer (D-NY) co-sponsored and introduced a bill in the Senate entitled the "Securing Adolescents From Exploitation Online (SAFE) Act of 2007" that would also require sex offenders to register their e-mail addresses and instant messaging ("IM") names. This bill is currently still pending before Congress.

Efforts are also being made on an international level. The Australian Province of New South Wales recently passed laws requiring Internet sex offenders to register their e-mail addresses, IM names, and Internet Protocol ("IP") addresses. Britain is also considering instigating similar requirements.

Proponents of these bills have applauded Congress's efforts to better track sexual predators online. They claim that this will help the Internet become a safer place for children to interact with their peers using the various social networking sites. However, critics of the bill claim that these efforts will create a heavy burden on civil liberties, as well as provide a false security blanket.

World Wide Translations: ICANN Testing Internationalized Domain Names

Historically, Internet domain names have been primarily comprised of English letters and characters. Since computers can only understand numbers, domain name registrars use the standard American Standard Code for Information Interchange (ASCII) to establish numerical representations of these characters. ASCII encoding is used on most computers and printers.

In April 2002, ICANN released a discussion paper discussing the importance and potential implication of non-ASCII encoded top-level domain names (“TLDs”) to make the Internet more accessible to those who speak languages other than English. Subsequently, in June 2003, ICANN announced the deployment of internationalized domain names (“IDNs”) to allow for the development of language-specific websites that would benefit a greater diversity of geographic, ethnic, cultural, and linguistic populations. These IDNs use a “punycode” translation to transfer the numbered encoding from ASCII characters into non-ASCII characters that are universally represented in many different languages by a singular “Unicode.” Since this time, ICANN has monitored the progress of, and continued to implement, usage of IDNs.

In July 2007, ICANN announced a plan to publicly evaluate the ease and success of IDN usage. In mid-October 2007, the evaluation period commenced, and ICANN has encouraged the public to participate and provide feedback. The initial phase allows individuals to register a domain name in one of eleven test languages – Arabic, Persian, Chinese (simplified and traditional), Russian, Hindi, Greek, Korean, Yiddish, Japanese and Tamil – and develop a wiki with their name in their own language. After the first week of testing, ICANN reported that over 128,000 people had participated, with over 37% registering their domain names in Chinese.

Upon completion of the evaluation period, ICANN intends to determine how usage of these IDNs can best be implemented on a permanent global scale. ICANN’s goal is to “make the Internet less English-dependent”, and allow Internet users around the world to develop and connect to websites using their own native languages.

What’s In Your Neighborhood? “.city” Domains Could Provide the Answers

Within the past few months, a growing number of individuals, businesses, and organizations have lobbied the Internet Corporation for Assigned Names and Numbers (“ICANN”) to develop and release “.city” top-level domains (“TLDs”). Berlin, New York City, Paris, London, and Buenos Aires are the primary cities seeking these new TLDs in order to publicize information about their municipalities.

Many of the lobbying efforts have been driven by Dirk Krischenowski, founder and CEO of dotBERLIN. Krischenowski contends that “.city” TLDs could provide helpful advertising and informational pages for citizens, local businesses, and local governments, as well as tourists, that current “City.com” domains do not contain. For example, Krischenowski argues that <traffic.nyc> is intuitively easy to remember, which could therefore facilitate better communication with local authorities. In essence, “.city” TLDs would serve the functions of current country-code TLDs, such as “.us” or “.eu,” but on a local level.

New York City is attempting to become the first American city to create its own TLD. Advocates believe that a “.nyc” TLD could provide many advantages, including online economic development, greater civic pride, better marketing opportunities for tourism, and an increased potential for networking. In April 2001, the Queens Community Board passed a resolution advocating for the “.nyc” TLD, stating that it would “make our community more governable, provide opportunities for small businesses, raise city revenue, and make navigating the Internet easier for our residents, prospective tourists, and businesses.” Despite the movement’s growing support, efforts were stalled when the city’s focus changed after the events of September 11, 2001. Currently, however, the “Campaign for .nyc” is allocating certain domain names to serve certain functions, including <directory.nyc>, <help.nyc>, <police.nyc>, <hotels.nyc>, <bronx.nyc>, and many others with hopes that ICANN will approve the “.nyc” TLD in 2008.

However, some initiatives to obtain a “.city” domain name have been met by opposition from their own government. For example, the “.berlin” movement has been faced with resistance from the Berlin government. The Berlin government claims that intellectual property rights to the name “Berlin” belong to the city, so only the city itself should be allowed to register any “.berlin” domain names. The government further claims that “.berlin” domain names would compete with its existing <berlin.de> domain name and the two could be considered confusingly similar under the Uniform Dispute Resolution Policy (“UDRP”). This dispute could significantly impact other campaigns to obtain “.city” TLDs.

Other intellectual property issues may also arise. For example, both Kansas City, Kansas and Kansas City, Missouri would presumably seek the “.kc” TLD. With each having legitimate interests, questions of priority may result. However, Craig Schwartz, ICANN’s Chief gTLD Registry Liaison, encourages individuals and businesses interested in obtaining a “.city” TLD for their city to rally local support and encourage their governments to submit proposals. Depending on what ICANN decides in early 2008, “.nyc” and “.berlin” may set the trend for establishing new local domains that could be beneficial to cities worldwide.

New Ratings Formulas Introduced To Measure Internet Audiences

Nielsen//NetRatings, an Internet media and market research company, issued a press release on July 10, 2007 indicating that it would be changing the way in which it measures Internet audiences. The press release announced that its NetView ratings system will now measure “total minutes” and “total sessions” on a website as opposed to average time per person and average number of views of a page. Nielsen//NetRatings believes this change is necessary in order to account for the increasing uses of AJAX (Asynchronous Javascript And XML) technology that delivers photos, online maps, e-mail, and other services and content without having to go to another webpage.

Another Internet research company, comScore, Inc., issued its own press release on July 26, 2007 also announcing its new measurements for Internet audiences. The press release indicated that comScore’s new Segment Matrix, which will be incorporated into its existing Media Matrix, will divide the current criteria and include “total minutes” in some of the measurement formulas. However, comScore President and Chief Executive Magid Abraham stated that total number of page views and other older measures will still be utilized along with the newer ones.

Both Nielsen//NetRatings and comScore’s new ratings systems are intended to better take into account the increasing amount of time Internet users spend on websites while watching videos on YouTube or messaging through AOL, for example. The new ratings systems are similar to how TV ratings are measured, which substantiate time spent on a channel as opposed to measuring the number of visits to each channel while flipping through them.

Mark Simon, vice president of industry relations at Did-it, an agency for search engine marketing and auctioned media management, believes that this change will not have a huge effect on businesses because, while branding is important, the personalization of products attracts consumers. Others disagree. According to Scott Karp, editor and publisher of media blog Publishing 2.0, measuring time spent “is problematic because it assumes that more time spent is a measure of a Web site's success.” Additionally, a recent Forbes article found that the change in measurements drew a mixed response from online advertising experts who noted that many websites do not use AJAX technology.

Sheryl Draizen, senior vice president of Interactive Advertising Bureau, an association which assists online media companies, stated that the new measurements are not definitive and that other methods should still be explored. Even Scott Ross, director of product marketing at Nielsen//NetRatings, indicated that time spent may not be the prevailing measure for long since the industry has not agreed on a standard measure. Ultimately, all parties acknowledge that the ratings formulas will continue to adapt as long as Internet capabilities continue to change and evolve.

M.V.A.A.: Market Value of Acronyms Assessed

In a report dated June 6, 2007, NameBio, an online marketer of domain names, released a study on the market value of domain names containing an acronym. The report focused on 33 publicly-reported three-letter “.com” domain name sales over a 60-day period.

The study found that 27 of the 33 domain names resolve to “parked pages,” or websites that are not in active use. The sale of these domain names generally ranged from $4,000 to $7,000. NameBio stated that one of the reasons why these domain names sold for less was because they contained “weak letters,” identified as J, K, Q, U, V, W, X, Y, and Z. According to the report, since it is relatively difficult to create an acronym with these letters, three-letter domain names containing any of these letters have a lower value. Of the six remaining domain names, four resolved to active websites. Two of those four were in the top three reported sales: the <amt.com> domain name sold for $100,000, and the <bcf.com> domain name sold for $71,200.

However, when choosing an acronym domain name, trademark rights must be taken into consideration. Some companies invest time and money into the development of an acronym as a company indicator, and those rights have been protected by alternative dispute resolution panels. For example, in National Rifle Association of America v. Future Media Architects, Inc., FA 781430 (Nat. Arb. Forum Oct. 13, 2006), the panel concluded that the acronym “NRA” was well-known, distinctive, and non-generic as an indicator of the National Rifle Association. The panel also stated that the respondent had constructive knowledge of the complainant’s rights to the “NRA” mark based on the complainant’s numerous trademark registrations with the United States Patent and Trademark Office (USPTO). Therefore, the panel concluded that the respondent lacked rights and legitimate interests in the disputed domain name, which it had registered and used in bad faith, and consequently ordered that the domain name registration be transferred to the complainant.

On the other hand, in Louis Vuitton Malletier S.A. v. Manifest Information Services, FA 796276 (Nat. Arb. Forum Nov. 7, 2006), the panel concluded that the <lv.com> domain name consisted of two generic letters that could be used to identify many things. Therefore, despite the complainant’s trademark registrations with the USPTO for the “LV” mark, the panel concluded that the respondent could establish rights or legitimate interests in the disputed domain name.

These two cases show that rights in an acronym domain name are analyzed on a case-by-case basis, and depend upon which letters are used in the disputed domain name and the overall use of the related website. Some websites, such as Acronymfinder.com, allow users to search for acronyms to see what they are being used for. Other websites, such as 3la.org or Domainnamesoup.com, allow users to search for acronym domain names to see if they are available. If an available acronym domain name can be found that does not infringe upon the rights of others, NameBio’s report indicates that it could be very valuable.

Report Shows Cybersquatting is Increasing Substantially

MarkMonitor, a San Francisco-based company providing online brand and Internet fraud protection, released its first quarterly brandjacking report on April 30, 2007. The report details the increasing amount of cybersquatting – the term for the registration of a domain name that infringes upon or otherwise violates the rights of a trademark holder – and other brand use violations. MarkMonitor and some others in the industry are specifically referring to this as "brandjacking," in which Internet users infringe upon the registered trademarks of businesses in order to advertise their own products. The concern of most trademark holders is that these violations potentially lead to brand dilution of the products and services that they market under their trademarks.

The report, based on an examination of twenty-five of the world's strongest brands over a four-week period, indicates that cybersquatting increased by 248% in 2006. MarkMonitor's study "found more than 286,000 instances of cybersquatting for the 25 brands it studied," averaging 11,400 instances per brand. Well-trafficked media websites, which constituted 31% of the reported instances, as well as financial services websites, appear to be the most attractive targets of cybersquatters.

Similar results were found when looking at other types of violations, including phishing, tasting (also known as kiting), and pay-per-clicks. Financial institutions are significantly impacted by both phishing and kiting; they represent 41% of all phishing instances and constitute the majority of all documented tastings. The report indicated that pay-per-click sites alone have provided about $125 million in profits to "cyber crooks."

The increase in domain name disputes handled by alternative dispute resolution institutions such as WIPO and the National Arbitration Forum ("FORUM") also support MarkMonitor's findings. In 2006, the FORUM's domain name dispute caseload increased by 21%.

The results of MarkMonitor's report indicate a real concern for businesses trying to protect their trademarks on the Internet. Specifically, these cybersquatting, phishing, tasting, and pay-per-click practices are leading to losses of revenue and advertising costs, and false association of brand names and products. As an initial defense, Internet browsers Firefox and Internet Explorer have attempted to block phishing attempts by inhibiting Internet users from accessing these sites. While the global efforts being made by Mozilla and Microsoft are laudable, businesses are ultimately encouraged to pursue individualized methods of protection, such as careful domain name monitoring, or contacting a specialist IT outsourcer for further assistance.

State Ban on Trademarks in Online Advertising Faces Challenges

Many individuals and businesses use keywords in online search engines to advertise products. Much to the chagrin of some trademark holders, certain search engines freely allow the use of trademarks as keywords, including the competitors of the trademark owner, to associate advertisements of the competitor’s product with the trademark.

In March 2007, the state of Utah passed the Utah Trademark Protection Act, which prohibits the use of a competitor’s trademark for online advertising purposes. The law created a new form of trademark – an “electronic registration mark” – to regulate the use of trademarks online. Essentially, a trademark owner could register its trademark in a Utah database and therefore proscribe competitors from using the trademark as a keyword.

Dan Eastman, Utah Senate Majority Whip and sponsor of the bill, stated that the law will “protect the value of trademarks held by Utah companies.” Matthew Prince, an adjunct professor at John Marshall School of Law in Chicago, noted that using another’s trademark in online advertising is illegal in other countries, and commended Utah for protecting its trademark holders in the absence of federal regulation in the United States.

Conversely, many are calling into question the constitutionality of the law. The state of Utah’s general counsel stated that “this legislation has a high probability of being held to be unconstitutional … [b]ecause of the potential impact on interstate commerce.” Google and other online search engines strongly oppose the law, alleging it has a “devastating effect on Internet users, online speech and Internet commerce.”

As a result of these criticisms and challenges, the Utah legislature is already considering amending, and possibly even repealing, the law. However, legislators are meeting with Google and other opponents in an attempt at compromise to protect trademark owners online within constitutional limitations. Ultimately, any compromise reached will impact advertisers in other states, due to the global nature of online advertising.

USPTO Report Raises Concerns over File Sharing

In November 2006, the United States Patent and Trademark Office (“USPTO”) released a report to the general public on the dangers of peer-to-peer (“P2P”) file sharing programs. These programs allow Internet users to install software onto their computers that will search the computer’s memory for certain types of files and then tag them to share. The programs then freely permit other Internet users to access those files and duplicate them onto their own hard drives. Many businesses utilize these programs as a fast and easy means of transferring files and sharing information between co-workers.

However, the USPTO report labeled file sharing as a national security concern because of the threat of exposing confidential and classified materials. The USPTO concluded in its report that five prominent P2P file sharing programs try to deceive users into unintentionally sharing infringing files. Program users themselves have no control over what files are tagged, and evidence now indicates that once a file is tagged, the tags are not removed, even after the removal of the P2P software. The USPTO report found that P2P file-sharing programs oftentimes tag files with sensitive or classified information, such as financial records, thereby leaving these confidential files exposed for others to duplicate. The USPTO concluded that the threat extended to not only government data but to personal and corporate records as well.

The USPTO report also discusses the intellectual property concerns businesses and the government might face, including copyright and trade secret information. In one reported case, a gang used a common P2P file sharing program to gain names and account information from personal and business sources in efforts to steal money and merchandise. In 2005, the U.S. Department of Homeland Security reported that they found "sensitive materials" on non-U.S. government computers. As a result of the concerns and problems created by these programs, the USPTO report claimed that "[t]here will almost never be a legitimate business or governmental justification for employee use of file-sharing programs." The overriding concern is that the continued infringement of copyrights by these programs will result in consumers having a greater “disregard [for] the importance of copyright protection.”

Jon Dudas, Under Secretary of Commerce for Intellectual Property and Director of the USPTO, stated that the USPTO released this report to raise awareness about this issue. Copies of the report were sent to the Department of Justice, the Federal Trade Commission, and the National Association of Attorneys General. The USPTO is ultimately hoping to solve the problem of illegal file sharing through active prevention among personal, corporate, and governmental Internet users.

As the Number of Business-Related Blogs Grow, So Do Liability Concerns

Consumers surfing the Internet looking for more information on Wal-Mart can now simply access an employee-operated Wal-Mart blog to learn about new store openings, the company’s economic impact in the communities it serves, employees’ perspectives of Wal-Mart, and many other things. In 2006, employees of other large corporations began to follow this trend and manage their own business blogs. According to a prominent Fortune 500 Business Blogging Wiki, as of October 2006, eight percent of Fortune 500 companies have employees utilizing blogs that provide information on the company's products and services.

While the percentage of companies with business-related blogs is growing, their use is still relatively low. One probable reason might be that employees may not want to assume legal liability over potentially infringing content. In providing information about a company, employees may, unknowingly or not, divulge trade secrets, infringe on the company’s copyrights, or violate other intellectual property laws. Employees might also be held liable for defamation if they post negative comments about their company. There have been numerous lawsuits litigated over these issues, and so far employers have won most of them.

Moreover, there is growing concern over the content posted by readers of one business-related blog. In August 2006, Traffic-Power.com sued Aaron Wall, the operator of SEOBook.com, a blog addressing search engine optimization, for publishing some of the company’s trade secrets and posting various defamatory remarks about the company. The case is significant because the remarks were made by readers who posted their own comments to Mr. Wall’s blog. According to the Wall Street Journal, legal analysts believe that this lawsuit could become an indicator of the extent to which bloggers can be held liable for defamatory remarks, as well as the publication of trade secrets or other intellectual property, posted by readers of the blog.

Currently, the standards are somewhat ambiguous. In 2003, the Ninth Circuit Court of Appeals held that the operator of a website can post material written by others without being held liable for that content. On the other hand, the California Court of Appeals held in 2006 that blog operators can be exposed to increased liability if they hold themselves out to be publishers that control the content of the blog. As the amount of litigation continues to increase on these issues, the extent of bloggers’ liability should become more transparent, encouraging or deterring many others to join the growing trend of business-related blogging.

More information on the law as it relates to blogging can be found in When a Business Begins a Blog: It’s Easy, but is it Safe? By John E. Ottaviani, John W. Bagby and Kristie D. Prinz. This article has also been published in the American Bar Association's Business Law Today Volume 16, Number 3 January/February 2007.

Critics Grow as “Domain Tasting” Becomes More Prevalent

“Domain tasting” commonly refers to a practice in which domain name registrars use a five-day grace period to test the marketability of domain names without incurring the usual charges from the Registry. Specifically, the registrar can gauge the amount of traffic generated by commonly misspelled domain names, and subsequently delete the ones which are less visited at the end of the grace period in order to avoid registration fees. The five-day grace period is governed by the Internet Corporation for Assigned Names and Numbers (ICANN), which originally created this policy with the intent to provide registrars with a recourse in case a domain name was accidentally misspelled during registration.

However, some companies have attacked the policy as inadequate because they claim that the practice of domain tasting goes far beyond its policy’s intentions. Retailers Neiman Marcus and Bergdorf Goodman have alleged in a federal lawsuit that domain name registrar Dotster is using the policy to determine which commonly misspelled domain names are visited most often in order to maximize profits generated from cybersquatting. The lawsuit has yet to be resolved.

In response to this growing concern, ICANN adopted an amendment to its .org Registry Agreement with the Public Interest Registry on November 22, 2006 that authorized an excess deletion fee on certain “.org” domain names. Some have applauded ICANN for these efforts, while others have criticized ICANN for the limited scope of this amendment. Some large domain name registrars such as GoDaddy.com, which recently teamed up with Google and eNom to sell addresses ending in “.com,” “.net,” “.biz,” and “.info,” have verbally and in writing called for further change to ICANN’s policy.

Approximately 4 million domain names are currently tasted in any given day according to Jay Westerdal, CEO of the domain consultancy firm Name Intelligence, and the practice continues to increase. This issue is likely to remain hotly debated for quite some time.

‘Tis the Season to Install Electronic Medical Records Systems

Following the recent changes in regulations governing electronic medical records systems, vendors have seen an immediate reaction in market demand for fully integrated systems. One of the main obstacles preventing physicians from shifting gears and introducing electronic medical record systems is the sheer cost associated with the initial set up, which some estimate is around $20,000 per physician.

Heightening this barrier is the lack of a direct benefit for physicians who make the investment in their own system. Physicians benefit when the entire community is electronically connected through capable and compatible systems. Tom Leary, director of federal affairs for Health Care Information and Management Systems Society, mentions that physicians are viewing the installation of their own electronic system as a benefit to other physicians, rather than their own practice.

The new regulatory shift strives to crumble the hefty financial barrier by allowing hospitals to donate to physicians the software, maintenance and Internet fees associated with the establishment and upkeep of an electronic medical records system. The new regulation, most importantly, requires the donated software to be compatible with other similar systems around the country. This is an effort to avoid the possibility of hospitals using donations of incompatible software as a means of stifling competition. The new regulation not only aims to lessen the initial financial burden associated with the installation of capable systems, but it also strives to spur the growth of a compatible, nationwide system.

As the electronic medical records industry grows, we will likely see a number of large players get into the market. Adam Bosworth, Vice President of Google, Inc., recently stated on the official Google Blog that the availability of personal medical records is an area in which its industry should become involved.

“U” and “You” Feuding Over Domain Name

Since its inception in February of 2005, YouTube has become nothing short of the proverbial wide-load, trucking its way down the information superhighway. What began as a small venture by some programming gurus has developed into an enormous enterprise that was recently acquired by Google for $1.65 billion in stock. YouTube, a free video sharing service, touts that it streams over seventy million videos per day. In spite of its popularity, however, there is some confusion among Internet video connoisseurs between YouTube’s domain name, <youtube.com>, and its phonetically identical counterpart, <utube.com>.

Universal Tube & Rollform Equipment Corporation, a company based out of Perrysburg, Ohio, is the owner of the <utube.com> domain name. Since registration, it appears Universal Tube has used the domain name to resolve to its company website that deals in the trade of industrial tubing. According to Alexa’s traffic statistics, the <utube.com> domain name has experienced a dramatic spike in traffic that directly coincides with the increasing popularity of YouTube’s website. Before YouTube’s arrival, Universal Tube’s website averaged around 1,500 unique visitors per month but current reports show that over 2,000,000 users now visit the <utube.com> domain name per month. This spike in traffic has caused numerous service outages and the company fears that it has lost sales as a result of consumer confusion.

Rumors abound that Google has offered Universal Tube $1 million for the <utube.com> domain name. However, this claim was denied by Google representatives. It appears that Universal Tube has brought a claim against Google where it asks Google to either (a) use a domain name other than <youtube.com> or (b) compensate Universal Tube for the costs associated with the creation and promotion of a new corporate identity on the Internet. This story, as it unfolds, will surely be a lively example of how similar trademarks in different industries can overlap within the Internet context.

Agreement between ICANN and DOC Strikes “New and Different Relationship”

The Internet Corporation for Assigned Names and Numbers (ICANN) and the United States Department of Commerce (DOC) signed a new Memorandum of Understanding (MoU) on September 29, 2006, which effectively amended the Joint Project Agreement (JPA). Setting the flurry of acronyms aside, the publication defines the roles of the two entities in the administration of the backbone of the Internet and emphasizes their continued commitment to the transition of the administrative force behind the DNS system to the private sector. The amended JPA is effective until September 30, 2009 and may be extended an additional 18 months at the discretion of the two entities. Vinton Cerf, chairman of ICANN, told a CNET reporter that the new agreement defines a “new and different relationship with the Commerce Department.”

Most notably, the new JPA alters ICANN’s reporting requirements. ICANN will no longer submit semiannual reports to the DOC; rather, ICANN will publish an annual report to the Internet community as a whole that details its (1) bylaws, (2) responsibilities, and (3) strategic and operating plans.

The new JPA also highlights ICANN’s responsibilities in administering a secure and stable DNS system through an improved multi-stakeholder model. Though the JPA does not explicitly provide how the multi-stakeholder model will be improved, it provides that ICANN shall “strive to increase engagement with the Private Sector by developing additional mechanisms for involvement of those affected by the ICANN policies.”

Critics of the new JPA insist that the new agreement is merely a cosmetic make-over in order to convince the public of ICANN’s independence from US politics.

Department of Commerce Extends Agreement With ICANN

The Department of Commerce has extended its agreement with ICANN regarding the administrative control over the functions of the Internet Assigned Numbers Authority (IANA). The new agreement will commence on October 1, 2006, upon the expiration of the original Memorandum of Understanding. The duration of the new agreement is set for one year of service with optional annual extensions for up to four additional years. In an ICANN press release, Dr. Paul Twomey, President and CEO of ICANN, stated, “In executing this contract the Department of Commerce has confirmed that ICANN is uniquely positioned to perform this function.”

In addition to the extension of its control over the Internet’s domain name system, ICANN is contemplating an interesting change in the proposed registry agreements for the .ORG, .INFO and .BIZ generic top-level domains. On September 13, 2006, the ICANN Board of Directors will review public commentary regarding the proposed registry agreements that would not prevent registry operators from charging different prices for the registration or renewal of domain names on a domain-by-domain basis. In other words, the proposed agreements would allow a registry operator to set a registration or renewal price based upon what it believes the domain name to be worth. More information and developing commentary on this topic is available at CircleID.com.

ICANN Calls for Public Input Regarding Registry Agreements

Last month, at a meeting held by the National Telecommunications and Information Administration (NTIA), the Internet Corporation For Assigned Names and Numbers (ICANN) publicly committed to the eventual privatization of the management of the Internet’s domain name system (DNS). Even though the expiration of the Memorandum of Understanding at the end of September is quickly approaching, it remains unclear when and how the transition will occur. John Kneuer, the Acting Administrator of the NTIA, emphasized it will not take actions that compromise the stability or security of the Internet.

Additionally, ICANN published proposed Registry Agreements for a number of top-level domains, including .BIZ, .INFO, .ORG and the forthcoming .ASIA. In an effort to understand the diverse interests of involved international parties, ICANN is allowing public comments to be submitted at their website until August 28 for .BIZ, .INFO and .ORG and August 31 for .ASIA. The Registry Agreements for the .BIZ, .INFO and .ORG generic top-level domains (gTLDs) most notably feature the removal of price controls on registry services, which is consistent with the 2005 .NET Registry Agreement and the proposed .COM Registry Agreement. Under the proposed agreements, the registry operator would be required to give six months notice of any price increase for any registry service.

Putting any unforeseen conflicts aside, the forthcoming .ASIA top-level domain will be sponsored by The DotAsia Organisation and will likely be available 6 to 9 months after the formal Registry Agreement is signed. DotAsia’s website suggests that the availability of the new sponsored top-level domain (sTLD) will be made available beginning with a trademark sunrise period where interested groups with registered marks can preemptively register their domain names before it becomes available to the general public. Upon launch, the .ASIA sTLD will likely cause an upward spike in the registration of Internationalized Domain Names (IDNs) in the numerous Asian languages.

ICANN Marrakech Meeting Highlights: Add-Grace Statistics; U.S. Invites Commentary Regarding DNS Transition

ICANN allows a 5-day grace period in which registrars may rescind the registration of a domain name without incurring the $6 registration fee from VeriSign or the $0.25 fee from ICANN. The purpose of this policy is to safeguard the registration process from typographical errors and other mishaps that can occur in the registration process. VeriSign has recently released some compelling statistics regarding registrars’ use of the grace period. Accordingly, these statistics were highlighted and discussed at the Domain Name Marketplace Workshop during the ICANN Meetings in Marrakech, Morocco.

During the month of May, 616 registrars registered over 30 million new .com and .net domain names. Over 80% of those registrars utilized the grace period to delete a domain name within 5 days of addition to the registration system. However, it appears that a few bad apples are abusing the grace period in a practice contrary to the purpose of the policy. Twenty-nine registrars deleted over 97% of the domain names they registered. Moreover, 18 registrars were responsible for 98.1% of the deleted domain names pursuant to the grace period. Finally, the statistics show that approximately 38,600 domain names were systematically registered and deleted at least 6 times within one month.

Watch for the grace period policy to be one of many topics discussed at the public meeting held by the National Telecommunications and Information Administration (NTIA) on July 26 regarding the privatization of the coordination and management of the Internet domain name and addressing system. This meeting is in anticipation of the September 30, 2006 expiration of the Memorandum of Understanding that established the joint responsibilities of ICANN and the US Department of Commerce regarding the development and management of the domain name system. Public commentary on the broad topic of the privatization of ICANN may be viewed at the NTIA DNS Transition Website.

How to Master Your Domains

Many companies manage and protect their domain names in what can only be called piecemeal fashion. Often different employees of the same company are responsible for registering domain names on behalf of the firm. As a result, companies may have registered hundreds of domain names but are unclear about which names are registered, with whom they’re registered or when to renew the registrations.

Without a global domain name strategy, a company runs the increased risk of identity theft, intellectual property infringement, and loss of revenue streams associated with its brands. The best way to avoid these risks is to establish a company-wide domain name strategy.

Here are a couple of tips for managing domain name registrations:

1. Create a single account to manage all registered domain names. Use account management software tools, a registrar or an in-house specialist to locate the company’s currently registered domain names.

2. Develop and implement company-wide registration and management standards and procedures to help ensure that the company’s domain names are properly maintained in the future.

The National Arbitration Forum Offers IP Alternatives

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Since 1986, the National Arbitration Forum (FORUM) has been a leading provider of mediation, arbitration and other dispute resolution services. The FORUM has established specialized IP panels to add depth to its ADR expertise in the IP arena. The IP dispute resolution experts recruited by the FORUM combine highly specialized IP backgrounds with intimate knowledge and experience in ADR. These specialists are supported by the FORUM’s talented case coordinators and state of the art systems, which together enable them to provide superior IP dispute resolution services to parties seeking to avoid contentious litigation. Through such options as mediation, arbitration or mediation followed by arbitration, the FORUM offers alternatives to parties wishing to resolve their IP disputes quickly, efficiently and fairly. Contact the FORUM at 800-474-2371 for more information or visit our website at http://www.adrforum.com/.