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What's Good Faith?

Cybersquatters are catching heat from the federal government and from the agency that oversees the registration of domain names, the White House-appointed Internet Corporation for Assigned Names and Numbers.

The shortage of names has led ICANN to consider the addition of new top-level domain names, and the organization is expected to take action to expand the domain name structure at its July meetings in Yokohama, Japan.

"If you look around the world, cybersquatting has been the source of a lot of grief in the domain registration system," says ICANN President Michael Roberts. "The question of your rights to a name is a legal question under U.S. trademark law."

ICANN's domain dispute policy, which new registrars must agree to before becoming accredited, allows a complainant to choose an ICANN-approved dispute resolution service provider. There are currently three providers, including the UN'S WIPO.

Any person or company worldwide can file a domain name complaint using the ICANN domain dispute policy. If the parties aren't satisfied with the arbitration, they can still go to court to fight for the name.

How do you determine who has the rights to a domain name? ICANN's policy says that an administrative panel can transfer the name based on "bad faith": for instance, if the name obviously violates a trademark, or if the name was registered primarily to disrupt the business of a competitor. The name must also "be identical or confusingly similar to a trademark," and the holder must have no legitimate interest in the name.

The blistering growth of the Net makes for a lot of gray area in establishing the right to domain names, says Kevin Goering, an Internet law specialist at the New York firm Coudert Brothers.

"If a company is in a very different type of business and it's likely that no one would confuse the two, there would probably not be a finding of bad faith or a violation of trademark law at all," says Goering.

Just Volks

Jim Anderson knows first-hand about domain disputes. Automobile manufacturer Volkswagen questioned his right to use the domain vw.net and sent a cease and desist letter to Anderson's Virginia-based networking company, Virtual Works Incorporated.

"When we registered our name, it was understood that .net was a network service provider," says Anderson. "We had to jump through loopholes to get the name. We were very happy it was available."

Anderson tried at one point to sell the name to Volkswagen, then sued the automobile maker for trying to have the name vw.net canceled.

In late February, however, a U.S. District Court in Virginia ruled that Volkswagen had the right to the name, saying vw.net diluted Volkswagen's trademark the way that "Buick aspirin" or "Kodak pianos" would. The court ordered the transfer of the name to Volkswagen, which recently put up its content at vw.net. Virtual Works is appealing the decision.

"They've never done business as VW," says Volkswagen's attorney, Gregory Phillips. "VW is a famous trademark, and Internet users would intuitively think that VW belongs to Volkswagen. I think eventually all famous trademark owners will want their .net and .org names."

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