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THE INDUSTRY STANDARD'S
N E T L A W
A Weekly Report on the Law Shaping the Wild, Wild Web
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| http://www.thestandard.com |
Tuesday, May 9, 2000
TOP STORY:
* What's in a Name Dispute?
SAID IN CHAMBERS:
* Lawyers for Napster and Metallica square off
BRIEFS:
* This Week in the News
FILE YOUR OPINION:
* How can ICANN ensure fairness in domain-name arbitration?
Last Week's Question: Can class-action lawsuits help prevent dot-com
stock fraud?
"With the general inattention of the investing public these days,
there does not appear to be the need to commit fraud in a dot-com
stock. You could probably put recipes in a dot-com prospectus these
days and the IPO would still sell out. Class-action suits too often
have resulted in making the plaintiff's lead counsel wealthy while not
returning much value to the investors. Call it redistributing the
wealth from MBAs to those with JDs."
-Harvey S. Jacobs,
Attorney At Law
Washington, DC
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TOP STORY
~~~~~~~~~
What's in a Name Dispute?
By John Roemer
Last time we looked, in January, there had been exactly one
domain-name dispute filed with the Internet Corporation for Assigned
Names and Numbers. (To nobody's surprise, ICANN took
worldwrestling.com away from a California man and gave it to the World
Wrestling Federation.) Now, four months later, more than 600
domain-name cases are on ICANN's books, with litigants looking for
quick, cheap dispute resolution. But a leading Internet law scholar
warns that since that inaugural case, the desire for speed and low
cost may have superceded fairness and consistency, a pattern that
bodes ill for future cases.
"Although ICANN has created a reasonably effective process, the
legitimacy and long-term acceptance of domain-name dispute resolution
will depend upon a body of decisions that are consistent, fair to all
parties, not biased toward trademark holders, and freely available and
searchable," says Michael Geist, a University of Ottawa law professor
who specializes in e-commerce and Net issues.
Geist says that ICANN has raised concerns "by ruling in favor of
trademark holders in some fairly suspect circumstances." He cites a
man who registered Esquire.com in 1994, thinking he was getting a
generic term for lawyers. But Hearst Communicatons, the publisher of
Esquire magazine, persuaded an ICANN arbitrator to transfer the name
to Hearst. This happened, Geist notes, even though the name was
registered years before cybersquatting was a problem -- and even
though the first registrant never made suspicious moves like trying to
sell the name to Hearst.
Another case concerned one of ICANN's own arbitration providers,
eResolution.ca, a Montreal-based outfit that did not exist in early
1999 when a California individual registered eresolution.com. Even so,
an arbitrator from another forum, the World Intellectual Property
Organization, took the name from the Californian and gave it to the
Canadian company.
The problem, Geist points out, is these early decisions are creating a
new body of law. "ICANN 'law' is at a very early stage," he says.
"Arbitrators are beginning to rely upon and cite prior decisions, but
the caselaw is relatively inaccessible and hard to search." No search
engine exists to sort through prior rulings by keyword, so those with
a potential dispute may have to pay a high-priced lawyer to do a
tedious check of all cases so far, seeking precedent. "This last point
is absolutely critical," Geist says.
If that doesn't happen, domain disputes will be forced into
courtrooms. Last week federal jurors in San Francisco heard testimony
from witnesses for E-cards.com and Ecards.com, rival online
greeting-card firms. E-cards' suit says its rival violates federal and
state unfair competition laws. That case will cost the litigants tens
of thousands of dollars in legal fees, travel expenses and other costs
- the Washington, D.C., law firm Williams & Connolly, representing
e-cards, bills $400 per hour - in contrast with a total fee of $1,000
for an ICANN arbitrator, who operates chiefly by e-mail. The federal
judge decided to take the greeting-cards case even though Ecards is
based in Canada. In similar cases, other federal judges have ruled
that they have no jurisdiction. By contrast, ICANN takes a global
approach. "The explosive growth of these arbitration cases has led to
growing pains," Geist concludes, "but it's important for the system to
get better organized and strive for consistancy."
Domain-Name Wars Heat Up
http://www.globetechnology.com/archive/gam/E-Business/20000504/TWGEIS.html
ICANN Dispute Resolution Site
http://www.icann.org/udrp/udrp.htm
Prof. Michael Geist's Internet Law News
http://www.lawbytes.com
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SAID IN CHAMBERS
~~~~~~~~~~~~~~~~
"[We] will review the over 300,000 fan names that Metallica turned in
as soon as possible. If the claims are submitted properly, the company
will take the appropriate actions to disable the users Metallica has
identified. Of course, if the band would provide the names in
computerized form, rather than in tens of thousands of pages of paper
intended to create a photo op, that would expedite the process." -
Napster's lawyer, Laurence Pulgram of San Francisco, after Metallica
band members delivered to Napster's San Mateo, Calif., headquarters
the identities of people who allegedly downloaded the band's music
illegally.
``The technology is always going to run ahead of the law. ... You
educate the public - it's wrong, it's criminal - then you go after the
largest offenders. Right now, that's Napster. After Napster, who
knows? It's certainly not out of the question that somebody goes after
the users.'' - Metallica lawyer Howard King of Los Angeles.
http://www.mercurycenter.com/svtech/news/front/docs/napstr050400.htm
FURTHERMORE:
Napster Loses Round One
http://interactive.wsj.com/articles/SB957829189796006031.htm
(Paid subscription
required)
Metallica Confronts Napster on Site Users
http://www.nytimes.com/library/tech/00/05/biztech/articles/04music.html
(Free registration required)
Legal Experts Explain Potential Troubles for Napster Fans
http://news.cnet.com/news/0-1005-200-1814794.html
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BRIEFS
~~~~~~
FTC CRACKDOWN ON E-COMMERCE ADS: Online ads are growing, but consumer
confidence might dwindle unless fraud and deception are squelched, the
Federal Trade Commission says. The FTC is promoting a 20-page booklet
that insists: "All real-world consumer protection laws apply in
cyberspace. Disclosures must be clear and conspicuous and on the same
screen as the triggering claim." FTC rules and guides using old-speak
terminology still apply, so references to "written" mean screen text
and "direct mail" includes e-mail. The FTC said it intends to continue
"to see that consumers get what they pay for."
http://interactive.wsj.com/articles/SB957402460160455109.htm
(Paid subscription required)
http://www.ftc.gov/bcp/conline/pubs/buspubs/dotcom/index.html.
MP3.COM JUDGE SPEAKS: U.S. District Judge Jed S. Rakoff of Manhattan
has filed a detailed explanation of his ruling against MP3.com on
copyright-infringement charges brought by record companies. He
rejected MP3's argument that it doesn't break copyright law because it
requires users to prove they own a CD before delivering a download.
"In actuality, defendant is re-playing for the subscribers converted
versions of the recordings it copied, without authorization, from
plaintiffs' copyrighted CDs," he wrote. Rakoff rejected MP3's
assertion that it is a consumer-friendly alternative to Net music
pirates: "Stripped to its essence, defendant's 'consumer protection'
argument amounts to nothing more than a bald claim that defendants
should be able to misappropriate plaintiffs' property simply because
there is a consumer demand for it. This hardly appeals to the
conscience of equity." Meanwhile, MP3.com CEO Michael Robertson said
the suit may be resolved by cutting "monumental" licensing deals with
the industry. The company took a first step by inking a pact with
music copyright holder BMI, representing more than 140,000 songwriters
and composers.
http://interactive.wsj.com/articles/SB957469678408780710.htm
(Paid subscription required)
http://www.techserver.com/noframes/story/0,2294,500199474-500274580-501451685-0,00.html
http://www.nysd.uscourts.gov/courtweb/pdf/00-04756.pdf
http://news.cnet.com/news/0-1005-200-1823327.html
BILL GATES COULD WORK FOR UNCLE SAM: Congressional lawmakers passed a
bill giving thumbs up to federal information-technology jobseekers who
lack college degrees. Legislators shied away from requirements that
eliminated skilled applicants who never finished school. The move gets
strong backing from the Information Technology Association of America,
an industry lobby that produced a study showing that labor shortages
will cause half the 1.6 million new IT jobs projected for 2000 to go
unfilled. If the bill becomes law, it would open the federal
employment door to Bill Gates, who dropped out of Harvard in his
junior year, along with degreeless computer maker Michael Dell and
Oracle's Larry Ellison.
http://www.nytimes.com/library/tech/00/05/biztech/articles/03tech-contracts.html
ADDITIONAL LINKS:
FBI Adds New Online Fraud Squad
http://www.thestandard.com/article/display/0,1151,14899,00.html
Philippines 'Love Bug' Suspect Ordered Freed
http://www.thestandard.com/article/display/0,1151,14913,00.html
Microsoft to Propose Self-Restrictions This Week
http://www.thestandard.com/article/display/0,1151,14879,00.html
Microsoft Drafts Reply to Breakup Proposal
http://www.washingtonpost.com/wp-dyn/articles/A13986-2000May5.html
EU Approves E-Commerce Legislation
http://www.thestandard.com/article/display/0,1151,14788,00.html
24/7 Sues DoubleClick for Patent Infringement
http://www.mercurycenter.com/svtech/news/breaking/merc/docs/061907.htm
U.S. Indicts 17 for Software Theft
http://www.nytimes.com/library/tech/00/05/biztech/articles/05soft.html
(Free registration required)
Pollstar Sues Gigmania.com Over Event Listings
http://www.wired.com/news/business/0,1367,36070,00.html
Microsoft Case Could Prompt Employee Departures
http://news.cnet.com/news/0-1003-200-1816984.html?tag=st.ne.1002.thed.ni
Microsoft Case Viewed As Political Powder Keg
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2000/05/03/MN2071.DTL&type=tech_article
FILE YOUR OPINION
~~~~~~~~~~~~~~~~~
This Week's Question: How can ICANN ensure fairness in domain-name
arbitration?
E-mail your opinions to johnr@thestandard.com and we'll print a
selection of the responses in next week's newsletter. Keep them short,
and include your name and affiliation if any.
Last Week's Question: Can class-action lawsuits help prevent dot-com
stock fraud?
"With the general inattention of the investing public these days,
there does not appear to be the need to commit fraud in a dot-com
stock. You could probably put recipes in a dot-com prospectus these
days and the IPO would still sell out. Class-action suits too often
have resulted in making the plaintiff's lead counsel wealthy while not
returning much value to the investors. Call it redistributing the
wealth from MBAs to those with JDs."
-Harvey S. Jacobs,
Attorney At Law
Washington, DC
"Have class-actions stopped other (nondot-com) stock fraud? No. Sadly,
for dot-coms, the answer will be the same."
-M. Hope Aguilar,
Gazillion Interactive
Los Angeles
"Where there are nervous investors, large amounts of money and the
possibility of fraud there will always be class action lawyers.
However, where there is financial trouble, large amounts of money and
nervous investors, there will always be stock fraud."
-Marcus Bornfreund,
The University of Western Ontario
London, Ontario
STAFF
~~~~~
Written by John Roemer. Send newstips and press releases to johnr@thestandard.com.
Edited by Lori Patel (lorip@thestandard.com).
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