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Predicting Domain Name Trademark Infringement

Legal trademark issues related to domain names will take a long time to resolve. Meanwhile, using a statistical model to determine infringement benefits all parties.

The legal system has not yet established comprehensive and easy to understand rules under which a domain name is considered to infringe on a third party’s trademark. The vacuum allows trademark owners and their agents, such as the Coalition Against Domain Name Abuse (CADNA), to sue domain name owners pretty much at will, but doing so is not always in the best interest of trademark holders.

If ICANN decides to go ahead with making new top-level domain names (TLDs) available to the highest bidder, the problem will increase exponentially and create tremendous headaches for trademark owners. Thus, finding an immediate solution, though not perfect, is better for all parties.

A real possibility would be to develop a statistical model that uses historical data on legal decisions to predict whether a domain name infringes on a third party’s trademark. For example, a logit-type regression model can be estimated, whereby the explanatory variables include trademark information, type of legal action, industry, and domain name information. Based on the model, the probability of the success of legal action can be assessed. Similar applications have been successfully developed to predict Supreme Court decisions and to value domain names.

Such a model would benefit all parties. It would reduce legal costs for trademark owners by focusing on cases with high probability of success, improve industry image, and decrease the anxiety, cost, and risk for registrants who cannot tell if their domain name is infringing. The benefits will also apply to future TLDs and new registrations under existing TLDs. Moreover, with the implementation of checks prior to approving registration, trademark-related domain tasting would drop.

Although there is no guarantee that the resulting model would have a strong predictive power, it is worth experimenting with such an approach. Model development can come from ICANN, the legal community, or an independent entity.

By Alex Tajirian, CEO at DomainMart

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When Domain Names infringe trademarks David Adler  –  Dec 10, 2008 7:57 PM

As an intellectual property lawyer battling cybersquatters and infringers for the last 11 years, I could not disagree with you more. There is a well-settled test for whether a domain name infringes a trademark. The holder of a trademark is protected from infringement under the Lanham Act which provides that infringement occurs when, without the consent of the trademark owner, one uses in commerce any reproduction, counterfeit, copy or colorable imitation of a mark in connection with the sale, offering for sale, distribution or advertising of any goods or services on or in connection with which such use is likely to cause confusion, mistake or deception.

Owners of both registered and unregistered marks are protected under Section 43(a) of the Act.  In order to prevail in a cause of action brought under Section 43(a), a complainant must demonstrate a valid, protectable interest in a trademark and that the alleged infringing use of a colorable imitation of a trademark is likely to cause confusion among consumers.  The second part of the test,

likelihood of confusion

, is based on an eight-factor test. Those eight factors are: (1) similarity of the conflicting designations; (2) relatedness of the two company’s products or services; (3) strength of the plaintiff’s mark; (4) marketing channels used; (5) degree of care likely to be exercised by purchasers in selecting goods; (6) defendant’s intent in selecting its mark; (7) evidence of actual confusion; and (8) likelihood of expansion in product lines.

Examining the proposed domain name against the trademark under this 8 factor test will lead to a very clear conclusion as to whether the domain name is likely to cause confusion that rises to the level of infringement.

I thought the Lanham Act was repealed Alex Tajirian  –  Dec 21, 2008 11:15 PM

I thought the Lanham Act was repealed with the Glass-Steagall Act. Just kidding!

As you note, the Lanham Act deals with trademark “uses in commerce.” And you are correct in noting that under such situations, it would not be easy to predict infringement using statistical models, especially with varying legal treatments outside the U.S. Nevertheless, I like to start small and dream big. Thus, we can initially concentrate on the use of trademarks in domain names rather than the use of domain names.

Let’s, for a moment, put aside existing “theoretical” implications of the Anti-Cybersquatting Protection Act.  Do you think that predicting “illegal use of trademarks in domain names” and “bad faith registrations”  prior to the approval of a domain name registration is worthwhile? Do you think that UDRP/WIPO historical cases can be useful in making such predictions?

Thanks for your input and for clarifying things for me.

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