Much has been written about the enforcement of trademarks in cyberspace. The rationale behind trademarks is to allow companies to protect their identifiable brand names and goodwill developed through investing in service, quality, etc. Traditionally the geographic scope of trademarks limited the likelihood of national — and transnational — disputes.
The global spread of the Internet and telecommunications has changed this dramatically, eroding the regional scope of trademarks. The Brookfield, 174 F.3d 1036 (9th Cir. 1999), and PETA, 263 F.3d 359 (4th Cir. 2001), decisions, which held that initial interest confusion exists with regard to domain names, opened the floodgates for similar trademark decisions. More recently, the litigation between Toys ‘R Us and Imaginarium highlighted the global tension arising out of companies seeking to preserve their trademarks in cyberspace.
Hence the transnational trademark problem arises: where two companies from two different countries have invested substantial resources in developing the same trademark, who should benefit from registering the domain name?
(Note: This problem particularly affects generic top-level domains (TLDs) like “.com” and “.org”, and less so country domains like “.co.uk”.)
Cyber lawyers will be quick to point to mechanisms for enforcing trademarks in cyberspace. As CNN v. CNNews.com, 162 F.Supp.2d 484 (E.D. Va. 2001), demonstrated, U.S. companies can utilize the Anti-cybersquatting Protection Act (ACPA) to force top-level domain (TLD) registries to turn over domain names similar to their trademarks. In CNNews.com, despite little to no evidence of bad faith or confusion, CNN was able gain in rem jurisdiction over the domain name and force the registry to forfeit it. Moreover, a company could resort to the ICANN dispute resolution mechanism (internationally WIPO) to settle a trademark claim. In both of these situations, however, one company is left unable (or less able) to use its trademark in cyberspace, a problem that undermines the value and importance of trademarks.
Although the CNNews.com example suggests that non-US companies may find it difficult to enforce their trademarks in cyberspace, there is a simple solution: change the architecture. On the surface, the structure of the internet is simply incapable of allowing two trademark holders to hold the same domain name. After all, ICANN, the pseudo-government of the internet, has specified particular registries for registering TLDs, and those domain registries only tie domain names to one server, one website.
However, as Lawrence Lessig famously suggested, law and its enforcement (in real or cyber space) is directly related to the architecture of the world in which it operates. The transnational trademark problem is solely the result of the world wide web’s architecture, and can be solved easily through the creation of national trademark TLD domain name system (DNS) servers.
DNS servers should be seen as internet phone directories in which ISPs look-up where a domain name points. If you want to find Otto’s Auto Repair Service in New York City, you could open a New York phone book and look up Otto’s phone number and address. In a similar way, DNS servers associate a server’s physical address with a domain name.
The existing doamin name system deviates from a phone book with regard to generic TLDs because DNS servers do not differentiate domain names geographically. If you look for Otto’s Auto Repair Service in a Chicago phone book, you will find a different phone number and address than in the New York phone book. If, however, you look for OttosAutoRepair.com in New York and Chicago, you’ll be directed to the same website. Whichever hypothetical Otto registers the domain name first undermines the others ability to set up shop in cyberspace — despite the fact that the two may not actually compete. Similarly, only one company with a particular trademark can have the domain, despite that same mark being held by another company in another country.
Like the Chicago and New York phonebooks, it is conceivable for countries to create different lists of trademarked domains. A country could pass legislation creating a national TLD DNS server for listing nationally trademarked domain names. This legislation could also require domestic ISPs to query the national registry before querying the ICANN-designated TLD DNS servers.
Thus, if Germany decides that it wants to give German trademark holders primacy with regard to domain names, it could pass the above legislation and require German ISPs to query its TLD DNS servers first. If a German company happened to hold the German trademark for “GAP”, a German user would be directed to the German company’s website, even though GAP.com is registered to the U.S. company in the ICANN-designated TLD DNS servers. If the German DNS doesn’t contain an entry for a particular domain name, the user would be forwarded to the usual TLD DNS servers.
Critics may view such a proposal as absurd, unnecessary government intervention in the internet, or a different instantiation of the Great Firewall of China. This, however, is nothing short of alarmist and misses the value added by such a system.
A country-based trademark DNS system would enable trademark holders to properly enforce their marks and reduce initial interest confusion for consumers. A consumer in Germany looking for a particular brand is more likely to be routed to the company he or she is actually seeking, as opposed to a foreign company. Moreover, this would greatly limit the impact of cybersquatters on foreign trademark holders.
Lastly, such a system would encourage companies to actively register their trademarks and domains overseas, adding clarity to the ownership of particular marks and reducing the frequency of disputes between foreign companies.