INTA Response

[mheltzer <mheltzer@inta.org>]

INTA Response to Draft UDRP, Accompanying Rules, and Provider Selection

	The following is the response of the International Trademark
Association ("INTA") to the request for comments from the Internet
Corporation for Assigned Names and Numbers ("ICANN") on the Uniform Dispute
Resolution Policy ("UDRP"), its accompanying rules, and provider selection
which were posted on the ICANN Web site on September 29, 1999.   INTA found
the UDRP posted on ICANN's Web site to generally be a positive development
in terms of the protection of trademarks in cyberspace.  However, we have
noted a number of areas where we believe amendments are needed.  They are
listed below. 

	 INTA thanks ICANN and its counsel, Louis Touton, for including
trademark owners and practitioners in the drafting process and looks forward
to working with the Internet community to ensure that the UDRP is
administered in a fair and effective manner.  We also welcome the
opportunity to revisit the UDRP issue 12 months after its implementation by
ICANN, so as to determine its effectiveness and whether changes are in
order.

	
The UDRP

Section 4(a)(iii)	

	INTA recommends that the word "and" as it appears between
"registered" and "is" in this provision be stricken and replaced with the
word "or".  The provision would therefore read: "your domain name has been
registered or is being used in bad faith".

	We recommend this change so as to make it clear that instances of
alleged warehousing are considered to be "Applicable Disputes."
Increasingly, cybersquatters are registering famous trademarks in bulk, but
in most cases, do not post an active Web site.  Moreover, as currently
drafted, this provision is inconsistent with the provisions of 4(b) wherein
mere registration of a mark can be in bad faith and, therefore, subject to
the policy.

Section 4(b)(i)		

	INTA believes that the burden of proof required by the phrase
"primarily for the purpose of" as contained in this provision is far too
high of a hurdle for the complainant.  It requires the complainant to know
of the domain name owners intent -- his state of mind when the domain name
was registered.  


	For the phrase in this provision which states "for valuable
consideration in excess of your documented out-of-pocket costs directly
related to the domain name," INTA recommends inserting the words
"registration of the" before the word "domain".  While a domain name
registrant may incur costs in connection with developing a Web site, it will
incur virtually all of those costs regardless of the domain name associated
with that site.  In the experience of the trademark community,
cybersquatters will claim any and all costs associated with the
development of a Web site as being directly related to its selection of a
domain name.  This change will make clear that general Web site development
costs should not be considered in considering whether a demand for a fee to
transfer a domain name is in excess of what is reasonable.

Section 4(b)(ii)	

	INTA requests clarification of the meaning of the term "pattern" as
it appears in this provision.    

	In the final phrase of this provision, "provided that a pattern of
such conduct has been established on your part," INTA recommends that
everything after the word "conduct" be stricken and that the words "the
facts indicate" be inserted before "a pattern."  The new phrase would read:
"provided that the facts indicate a pattern of such conduct." 

	 This change clarifies the ambiguous passive use of the term "has
been established."  It clarifies that the panel may properly infer a pattern
of past misconduct from the facts or circumstances presented in the case.

Section 4(b)(iii)

	INTA believes that the burden of proof required by the phrase
"primarily for the purpose of" as contained in this provision is far too
high of a hurdle for the complainant.  It requires the complainant to know
of the domain name owners intent -- his state of mind when the domain name
was registered.  

Section 4(c) (Preamble)	

	INTA believes that the circumstances listed in 4(c) should be
treated as "factors" and not conclusive proof of "legitimate rights."
Guiding factors rather than conclusive proof is, in our opinion, more
preferable in fact intensive cases such as those involving domain names. 

Section 4(c)(i)		

	INTA believes that the phrase "demonstrable preparations to use," as
contained in this provision leaves trademarks subject to abuse by
cybersquatters.  It provides a cybersquatter with an easy-to-use mechanism
for defeating pre-existing trademark rights.  What precisely are
"demonstrable preparations to use"?  Could they be as simple as a
one-paragraph business plan?  Could this simple document somehow take
precedence over years and millions of dollars worth of investment in a name
by a trademark owner?   The phrase leaves open too many questions.   

	Moreover, despite the so-called "preparations" the domain name
holder has made to use the particular domain name, they simply may not have
the right as a legal matter to use such name.  For example, an individual
who wishes to set-up a site called  to sell shirts with MICKEY MOUSE and
DONALD DUCK on them does not have the right to use the DISNEY trademark in
his domain name because he has developed a business plan. The name belongs
to The Walt Disney Company and only The Walt Disney Company can use it or
authorize its use.  

Section 4(c)(ii)	

	INTA strongly recommends that this provision be stricken completely.


	First, this provision creates a giant loophole for an individual to
adopt or allege that a trademark is a nickname in order to obtain the domain
name that corresponds to that nickname.  Moreover, what would be the burden
of proof imposed upon an individual to show that the domain name is indeed
his or her nickname?  Finally, once the respondent asserts that he or she is
"commonly known" by the domain name, how can the complainant, as a practical
matter, disprove this fact?

	Second, the "commonly known" concept is dangerously ambiguous.  For
example, who must the domain-name owner be "commonly known by" in order for
their ownership of the domain name to be deemed legitimate?  In addition, it
is unclear as to how long the domain name owner must be known by the domain
name.

	Third, it runs contrary to U.S. law.  The "commonly known" clause is
an example of people substituting their  emotional take on an issue for the
considered deliberation of many courts.  In the 1800's courts used to say
that "Every man has the absolute right to use his own name in his own
business, even though he may interfere with or injure the business of
another person bearing the same name . . ." Meneely v. Meneely, 62 NY 427
(1875). 

	This "sacred" right theory is now referred to as "archaic" by
Professor Tom McCarthy in his treatise titled McCarthy on Trademarks and
Unfair Competition (Fourth Edition, Section 13:8, note 14), and has been
expressly repudiated. See, e.g., David Findlay v. Findlay, 18 N.Y.2d 12
(1966); John R. Thompson Co. v. Mrs. Lee Holoway, Sr., et. al. 366 F.2d 108
(5th Cir 1966).



	In 1914, Supreme Court Justice Oliver Wendall Holmes wrote in the
"Waterman Pen" case that while everyone had a right to use their own name,
the junior user  must to take precautions in the manner of use so as not to
cause confusion with the senior user's mark.  L.E. Waterman Company. v.
Modern Pen Company., 235 U.S. 88, 59 L. Ed. 142 (1914).

	Thus, we have seen people ordered not to utilize their names in a
certain manner so as to avoid confusion with a prior right.  Sullivan v. Ed
Sullivan Radio & T.V., Inc., 152 N.Y.S. 2d 227, 110 USPQ 106 (1st Dept 1956)
( Defendant ordered to change name of business for ED SULLIVAN to E.J.
SULLIVAN); E. & J. Gallo Winery v. Gallo Cattle Co., 12 USPQ2d 1657 (ED Cal.
1989) (Joseph Gallo not permitted to use GALLO  as trademark, non-trademark
use of name limited); Lyon v. Lyon, et. al. 246 Cal App 2d 519, 152 USPQ 719
/(2d Dist 1966) (partner named Lyon left the law firm of LYON & LYON,
enjoined from using LYON as the name of his new firm).

	A belief in the "sacred right" has led to a series of cases where
companies have hired people of a certain name to join their businesses in a
bad faith attempt to acquire a defense against infringement, see Cartier v.
Three Sheaves Co., 465 F. Supp. 123 (SDNY 1979) (bad faith license by Pierre
Cartier), or where people have entered businesses just to take advantage of
their last name, Champion Spark Plug Co. v. Champion, 23 F. Supp. 638 (E.D.
Mich 1938) (Prosper Champion enjoined from selling spark plugs). 

	People have even legally changed their name to take advantage of the
so-called sacred right, Societe Vinicole De Champagne v. Mumm, 143 F. 2d 240
(2d Cir 1944) (woman named Mumm van Schwarzenstein legally changed her name
to merely MUMM, enjoined from using MUMM to sell champagne).

	All the above cases refer to surnames.  The circumscribed right to
use one's own name has, for the most part, not been extended to nicknames.
John Walker & Sons Ltd. v. Bethea, 305 F. Supp. 1302 (D.S.C. 1969) ("Johnny
Walker" Bethea enjoined from using JOHNNY WALKER).  As the court pointed
out, when adopting a nickname as a trademark, the defendant had an infinite
number of choices and chose a confusingly similar one.
 
	However, if ICANN elects to retain the provision in some form, we
recommend that amendments be made.  In particular, we suggest that there be
some type of high evidentiary standard placed upon the domain name owner to
demonstrate that he is known by the domain name in question.  Another
suggestion is to insert language which suggests that the domain name owner's
use is legitimate if he is "legally known by" the domain name.  Finally, we
also believe that this provision should only be relevant if the domain name
owner is known by the name prior to any notice of the dispute.



	The re-drafted provision could read:

"you (as an individual, business or other organization) provide substantial
(or clear and convincing) evidence that, prior to any notice of the dispute,
you have been legally known by the domain name, even if you have acquired no
trademark or service mark rights at issue."  

Accompanying Rules

Rule 2(a)	

	While INTA believes that it is important that domain name holders
receive actual notice of any proceeding, we find that the language in this
provision places an undue burden on the provider, increasing their level of
administration, as well as transaction costs.  Ultimately, providers may
elect not to participate in the ICANN UDRP process because of their
responsibilities under 2(a).  We recommend that ICANN revisit this provision
and consult with the providers concerning matters of notice.


Provider Selection

	INTA believes that of the options regarding provider selection which
were presented in the "Staff Report," letter d is the most appropriate.
Letter d allows both the complainant and the respondent some level of
control in a system which is new and will likely be met with some
skepticism.  Allowing the complainant to chose the provider will encourage
competition among providers to offer efficient and cost effective dispute
resolution to the parties, thereby decreasing the transaction costs involved
in the UDRP.  Moreover, given that the complainant has to pay, it is only
fair that a complainant have a choice in whose rate fits its budget.
Lastly, this is fairly close to the way typical arbitration proceedings are
carried out.