The Jurisdiction of Trademark and Copyright Infringement on the Internet - James H. Aiken

• Publication year: 1997

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The Jurisdiction of Trademark and Copyright Infringement on the Internet

I. Introduction

The unbounded territory known as cyberspace poses many jurisdiction-al questions. This Article presents and attempts to answer some of these questions as they relate to intellectual property ownership. The first section gives some background information on the Internet. The second section introduces some of the problems faced by owners of intellectual property who utilize the Internet. The third section discusses the jurisdictional questions posed by Internet infringment litigation. The fourth section discusses personal jurisdiction generally. A case study of existing cases dealing with Internet infringment follows and the Article concludes with a proposal for the most efficient and effective solution.

II. Background on the Internet

It is no longer just chic or hip to have a web page on the Internet. The Internet is now a necessity for most large to medium sized businesses and some small businesses. Experts predict that the Internet will account for 1.3 percent of the nation's economy, or $45.8 billion in revenues by the year two thousand.¹ Why are so many businesses attracted to the Internet? Because consumers are attracted to it. By the end of 1996, the total number of online subscribers was estimated at 18.1 million, up from 6.3 million in 1994.² In response to this synergetic growth, the potential for conflict between trademark or copyright owners and infringers is also increasing. Businesses and individuals now have the capacity to provide places to go on the Internet, containing virtually any type of information, protected or not, for a possible fifty-two million people.³

"Places" or hosts on the Internet are accessed using Internetworking Protocol Addresses ("IP addresses"). The Internet Assigned Numbers Authority ("IANA") is responsible for the assignment of IP addresses to users. IANA delegates the administration of IP address applications and registrations to InterNIC Registration Service, operated by a private firm called Network Solutions, Inc. ("NSI").⁴ IP addresses are represented as strings of digits divided into parts, or fields. Periods usually separate the fields in the IP address.⁵ A typical Internet address might be 132.76.249.197. This format is cumbersome and inconvenient, making it difficult for users to remember and use the address. A facility called the Domain Name Service ("DNS") has made access to IP addresses easier to use by equating mnemonic designations with IP addresses.⁶ Internet applications (browsers such as Netscape and Explorer) seamlessly refer to the DNS when a domain name is called for and direct the user to the appropriate IP address. The general format for a domain name is [subdomain].[subdomain].[domain].[field].

The field, or top-level domain, to the right of the domain name is a well specified and regulated area of the Internet. Each domain name is assigned a domain field based on its affiliation: commercial (.com); educational (.edu); governmental (.gov); military (.mil); network operator (.net); or miscellaneous organization (.org). Countries are assigned two-letter domain fields, including France (.fr); Germany (.de); and United

Kingdom (.uk).⁷ The domain is the designation of the entity, such as the name of the company or organization. Examples of domains are microsoft.com and mercer.edu. The number of domains on the Internet was estimated at 828,000 in January of 1997 (see Table 1).

Table 1: Semi-Annual Estimates of Internet Hosts and Domains⁸

Date	1	Hosts	Domains
Jan	97 1	16,146,000	828,000
Jul	96 1	12,881,000	488,000
Jan	96 1	9,472,000	240,000
Jul	95 1	6,642,000	120,000
Jan	95 1	4,852,000	71,000
Jul	94 1	3,212,000	46,000
Jan	94 1	2,217,000	30,000
Jul	93 1	1,776,000	26,000
Jan	93 1	1,313,000	21,000

A subdomain can be any division of the domain, such as departments of an organization, as in irs.ustreas.gov, or more typically, the organization of the location's contents, such as "www" for World Wide Web pages or "gopher" for gopher servers usually found at universities.⁹ The IANA, also responsible for assigning domain names, has delegated to InterNIC the operation of a name registry. InterNIC assigns domain names on a first-come, first-serve basis, and any entity registering a domain name may do as it wishes with that name: use it, reassign it, or simply hold it unused. Domain names are fully portable because they have no direct connection with IP addresses, except through the DNS, and can be transferred to a new machine or site if the name holder moves.¹⁰ It is the domain name that is often remembered or guessed by users when trying to access an organization. With increased competition due to the increased number of domains, companies are finding it increasingly valuable to have easily remembered and distinguishable domain names, usually equivalent to established, recognizable, and valuable trade-marks.¹¹

III. Trademark and Copyright Issues on the Internet

One source of potential conflict between owners of intellectual property and potential infringers is the use of trademarks as domain names by the infringer.¹² The technical limits of domain names can lead to confusion and deception with regards to trademarks. For example, organizations cannot use stylized fonts or formats, designs, or even capitalization to distinguish themselves from other organizations.¹³ Another difficulty in distinguishing domain names arises from the lack of context in the Internet medium. There is a greater risk of confusion in the marketplace as users cannot distinguish between different lines of business as they can in real space.¹⁴

An Internet address is not just a reference to a source of information; it is often the link between the buyer and seller or advertiser and audience. "From a commercial standpoint, it is the billboard component which is the carne of this electronic enchilada, and everyone wants a bite."¹⁵ The importance of being able to utilize the strength of a trademark by allowing users to access the owners via the domain name is often the highest priority among organizations with an Internet presence. Unreliable and difficult to use search engines¹⁶ are inade-quate substitutes for typing "ford.com."¹⁷

Another source of potential conflict between intellectual property owners and potential infringers is the infringement of copyrights.¹⁸ Internet users can produce their own web pages and, with a few clicks of a mouse, could potentially fill the screen of anyone who accesses the site with copyrighted material.¹⁹ Many large organizations, from 20th

Century Fox to K-Mart, are aggressively seeking out copyright infringers on the Internet and threatening litigation.²⁰ So far, most of the infringers have been either small scale fans setting up "unofficial WWW sites" or vengeful ex-employees berating employers.²¹ The only issues the infringers raise in response are usually in the form of hateful e-mail (a.k.a. "flames"), but the issues they raise often have merit and are in part the subject of President Clinton's proposed National Information Infrastructure Copyright Act.²² Presently, however, the laws governing intellectual property in cyberspace are questionable and quite possibly the subject of future litigation as more dedicated and legally resourceful infringers get involved.

The bottom line is that litigation over intellectual property issues related to the Internet is inevitable. Given the vast number of intellectual property owners putting their marks and works on the Internet and the ease with which others can infringe on those marks, curbing infringement is likely to become a high priority with owners.²³

Iv. Potential Problems with Internet Infringement Litigation

When the mere threats by intellectual property owners no longer make potential infringers shut down their sites or remove offending material, owners will have to sue to enforce their rights. One question that needs to be answered, and is as yet unclear, is where to sue. The physical locations of the infringers and owners can be virtually unlimited. Anyone with a computer and a phone line located anywhere in the world can access the Internet and publish or distribute offending material. Do intellectual property owners have to seek out and determine the location of infringers and bring suit there or is it possible to bring suit somewhere more convenient and less costly to the intellectual property owner?²⁴

In the early days of the Internet and computer bulletin boards, individuals openly trafficked unauthorized copyrighted and trademarked material with an above-the-law attitude coined "the spirit of the Internet."²⁵ In 1994, one infringer actually defended himself by claiming that because 45,000 other computer bulletin boards across the country posted copyright material, he should not be liable for his infringement.²⁶

During this "information wants to be free"²⁷ time period, Internet usage was limited to small time bulletin boards without international access. Individual networks were not connected and the sharing of information was limited.²⁸ The injury to intellectual property owners was small and did not justify the legal fees necessary to fully protect copyright and trademark rights.²⁹ The result was infrequent litigation; but when suit was brought, it was usually brought at the defendant's location.³⁰ This practice became the rule, and this unfortunate "rule of thumb" made protection of intellectual property rights on the Internet inconvenient and expensive, and opened the door to more damaging infringement as the medium gained popularity.³¹

The face of the Internet has changed vastly since the development of the "rule of thumb."³² Almost fifty million people have access to over ninety thousand networks.³³ Aggressive intellectual property owners are seeking more convenient and cost-effective means...