The Internet is by its nature a global enterprise for which no political or national boundaries are closed. Although this is its strength, it also creates problems when existing laws do not clearly address the uniqueness of the Internet and its related activities. Existing law is vague or does not completely cover such issues as gambling, the protection of domain names, taxes, jurisdiction in cross border transactions and contractual issues. The European Union, the United States and many other countries are drafting legislation to address the myriad legal questions not clearly addressed by current law. But until these laws apply world wide, companies will have to rely on individual country laws, which may or may not provide protection.
Domain names and Cyber squatters:
Unfortunately, the ease with which Web names can be registered and the low cost of registering has led to thousands being registered. Cyber squatters (CSQs) buy and register descriptive nouns, geographic names, names of ethnic groups and pharmaceutical substances and other similar descriptors and hold them until they can be sold at an inflated price. For example, a cyber squatter sold www.themortgage.com for $500,000 the record price paid so far is $7.5 million for the domain name www.Business.com if a cyber squatter has registered a generic domain name that a company wants the only recourse is to buy it.
Another of CSQ is to register familiar names and known trademark that divert traffic from intended destination or to sell competing products. eBay, the world’s largest online auction house, was embroiled in a dispute with an entrepreneur in Nova Scotia who registered www.ebay.ca thus forcing the US company to use www.ca.ebay.com for its newly launched Canadian Web site until it was successful in regaining the use of www.eaby.ca both Web addresses now to go the same site.
CSQs register a well known brand or trademark that misdirects a person to the CSQ’s site or to a competing company site. For example, an adult entertainment Web site registered www.cabnyland.com Hasbro the toy company markets a game for children called Candy Land. Disturbed by the thought that customers might end up at an adult entertainment site, Hasbro wanted to have the site vacated. It had the option of suing to have it removed or buying the domain name. Hasbro elected to sue and, although the adult Web site was not directly infringing on its trademark the courts deemed it to be damaging to the reputation of Hasbro and its children game. The Web site address now takes you directly to a Hasbro site.
Other cyber squatting abuses that can pose a serious threat to business include parody sites, protest sites, and hate sites. A good example is www.walmartsucks.org a site highly critical of Wal-Mart. This type of Web site may be difficult to prevent since the right to free speech is protected. The only defense Wal-Mart might have is to challenge the Web site’s right to sue a trade name to direct someone other site.
A growing number to celebrity names have been hijacked. Julia Roberts had her name registered www.leolair.com, minutes after the name was made public. Julia Roberts sued under the Anti Cyber squatting Consumer Protection act (ACPA) a dispute resolution forum in the United States that facilitates action against domain name squatters if the domain name infringes on a trademark or personal name. Prime minister Blair had leoblair.com evicted by his appeal to Nominet Dispute Resolution Service (DRS), a forum for resolving cyber squatting disputes in the United Kingdom. DRS requires the complainant to prove that it was right in respect to name or mark identical similar to the respondent’s domain name, and that the domain name is an abusive registration. Abusive registration is defined as a domain name that either was registered or has been used in a manner which takes unfair advantages of or is unfairly detrimental to the complainant’s rights.