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INTELLECTUAL PROPERTY

IN CYBERSPACE

A WEB PROJECT FOR CYBERLAW

NORTHWESTERN SCHOOL OF LAW

OF LEWIS AND CLARK COLLEGE

INTRODUCTION

by Bridget Morrissey

Cyberspace is wrecking havoc with intellectual property laws and intellectual property laws are wrecking havoc in cyberspace. In this new world made up of 1s and 0s, traditional ideas about ownership and property are difficult if not impossible to apply. On one end of the spectrum in this debate are those who believe cyberspace is no place for government regulation of any kind. (See Declaration of Independence for Cyberspace.) At the opposite end are those who are trying to fit the problems in cyberspace into the current scheme of intellectual property law. (See Intellectual Property and the National Information Infrastructure: The Report of the Working Group on Intellectual Property Rights.) The middle is a crowded place, filled with those who do not want to see cyberspace chilled by improper or overreaching regulation and yet want to preserve the incentives that intellectual property laws creates for holders. (See A Magna Carta for the Knowledge Age.) It is in this middle ground where the most difficult questions arise because to arrive at a solution, a balance must be struck.

COPYRIGHT

By Bridget Morrissey

Article 1, Section 8, Clause 8 of the United States Constitution describes the overall purpose of copyright law as a device intended "to promote the progress of science and the useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries." It is this concept of exclusivity that is finding cyberspace to be fairly inhospitable ground. In cyberspace, information is the main commodity and attempting to regulate its is a Herculean task. Nothing remains the exclusive information of one person for very long because once it arrives in cyberspace it becomes available to anyone. It is the culture of the Internet to clip information, add ones thoughts and forward it to a friend. This sharing often infringes upon copyright holders’ rights to copy and create derivative works.

Copyright Infringement

Cyberspace has revolutionized the activity of copyright infringement. It is easier and faster than it has ever been before and perhaps most importantly, it is accepted, normal and in some instances a necessary practice on the Internet.

On the most basic level, the mere act of browsing a web site is technically considered infringement. The test for infringement has two elements: ownership of a valid copyright and copying. The first element is generally fairly easy to meet with a web site. The only requirements for copyright protection are originality, a minimal degree of creativity and that the work is fixed.i Registration of the copyright and notice are not necessary for protection under copyright law. Most web sites fit this description and are copyrightable. The second element, copying, is met by the act of viewing a web site which automatically creates a copy in the viewing computer’s random access memory (RAM). This copy infringes the copyright owner’s reproduction right even though without this copy computers would not work. In his essay entitled The Economy of Ideas, John Perry Barlow posits that entirely new laws will need to be drafted for cyberspace. Barlow argues that "Intellectual property law cannot be patched, retrofitted, or expanded to contain digitized expression any more than real estate law might be revised to cover the allocation of broadcasting spectrum." This statement is particularly true in this circumstance. It is not surprising that a large number of netizens believe that copyright does not apply to cyberspace (see 10 Copyright Myths, ) because this interpretation of "copying" makes very little sense. It is difficult to imagine how copyright law will ever gain much currency in cyberspace if it is not especially cognizant of the technology that creates cyberspace. Leaving this construction of "copy" in place is completely at odds with the format of the Internet and computer technology and leaves copyright law looking foolish in the eyes of netizens. Without some respectability as well thought out and carefully drafted devices, those who are to be governed by laws pay them little heed. In order to make copyright laws, either in a modified form or in some new composition, viable and enforceable in cyberspace they must work with the structure of cyberspace creating logical lines to govern behavior.

Protection of Copyrighted Works

Owners of copyrighted works in cyberspace have a few options to use in protecting their works. One simple option is for authors and inventors to give their work directly to the public domain and allow free copying. However, this overlooks one of the incentives for copyright - to make money from a work for the duration of the copyright protection. Though in a perfect world authors and inventors might create works and send them out for the edification of human kind, the reality is that creators generally want and need to see a financial return on their creations. Thus presenting a work to the public will not always be an option for those engaged in inventing or writing as their trade.

Another option is to require that those who copy a work request permission first. For example, Tom W. Bell has included a request that fixed copies of his paper, Fair Use vs. Fared Use: The Impact of Automated Rights Management of Copyright’s Fair Use Doctrine, not be created without his express permission. Bell includes a direct link to his email address to facilitate this process. Although this method is by no means fool proof it is probably effective considering his probable audience – those interested in copyright issues.

Bell’s paper itself describes a system of "faired use" in which users would pay for access on a document-by-document basis. Under this system, which has been advocated by the White House Information Infrastructure Task Force report on Intellectual Property and the National Information Infrastructure, a user would pay approximately .02 cents per access per document and copying would be prohibited. This proposition would however limit the doctrine of fair use which is the major counterbalance to the exclusive rights of copyright holders. Noncommercial uses of portions copyrighted material for news reporting, criticism, parody and comment that are generally considered to be fair use.ii To use a portion of a copyrighted work for one of these purposes is not infringement because these uses are considered beneficial to society. Under "fared use" these fair uses would be severely limited. This raises problems with the First Amendment as wells as with the culture of cyberspace in which "information wants to be free." (See The Economy of Ideas.) Congress is currently considering bills which would help to implement this fared use system by prohibiting the circumvention of technological protection measures which could include a pay-per-view measure. (See H.R. 2281 and S. 1146. )

One of the other technological measures that is currently available is a digital watermark. This device, which is hidden behind an image, is activated when the image is opened and displays the copyright status of the work along with information to help the user get in touch with the artist. (See Digital Watermarks.) If the user did not obtain permission from the artist, the watermark would remain embedded in the image and the same message containing the copyright status would display upon opening the image. This mechanism could be useful especially if the message indicated that if the image appeared anywhere other than the artist’s web site it was infringement and urged those seeing it to contact the artist. It seems that netiquette might serve this purpose well. This technological measure comports with the atmosphere of cyberspace and with the purposes of copyright because it keeps the access of information free while at the same time giving the artist rights to her work. Watermarks combined with some form of encryption that would not allow copying with out permission - in the form of a key - could be the best alternative for protecting copyrights. The terms under which a user would obtain the key or the new message for the watermark could be a negotiated transaction between the user and the author or as simple as a flat licensing fee or full attribution to the creator on the user’s web site. The market would then decide what kind of terms are acceptable in cyberspace.

There is one thing that remains a crucial factor in the success of any measure designed to protect copyright, it is education of the netizens. There is already a fair amount of information available to those who wish to create web sites. A search on Yahoo! brings up many resources for web site designers to consult as they consider the copyright issues that are involved in cyberspace. (For an example of such a resource, visit Web Issues .)

But there remains the problem that copyright infringement is very easy to do in cyberspace. Most web browsing software contains a source/save feature which with a quick right-click snips an image and saves its source code on the viewing computer. This feature is very helpful for obtaining images that have been given to the public domain. For example, the image of the symbol for the Blue Ribbon Campaign on the Electronic Frontier Foundation’s web site is available to anyone who would like to put it on their web site. However, the image of the Star Wars Tie Fighter on the Lucas Arts web site is a copyrighted image and is not intended to be copied freely. By using a source/save feature both of these images are easily copied, one infringing and one completely permissible. The availability of this source/save feature is in essence promoting copyright infringement. Though this is presumably not the intended purpose of the feature, it is undoubtedly one of its most commonly used purposes. Thus, the creators of web browsers must also be educated about copyright and be encouraged to develop a feature that refuses to copy an encrypted or watermarked work without the proper key. At the same time, authors and inventors must be educated about the necessity to use some form of technological mechanism to keep their works from being copied.

Fan Sites

One of the more popular creatures in cyberspace is the web site dedicated to popular television shows. These sites are the meeting grounds of fans to discuss the episodes and they are also a recent hot bed of controversy regarding copyright. A current example of this problem involves popular television programs from the Twentieth Century Fox network. Fans of the television shows King of the Hill, Millenium and The X Files created web sites dedicated to these shows. See Fox Slams Bootleg Millennium Sites. On these web sites fans could find information about their favorite shows, characters and actors. This type of information most likely falls within the fair use exception as news reporting and the networks usually left sites with this kind of information alone. However, when these sites began carrying audio clips and fan fiction using copyrighted characters the network’s lawyers got involved.

On his web site entitled "Yeah man, Itellyawhat…" which is dedicated to the King of the Hill television show, Noel Gross included audio clips from the show and was contacted by attorneys representing 20^th Century Fox requesting that he remove them. Fox also asked Gross to display legal copyright notice and a disclaimer on every page of his site that contained King of the Hill images. Similar notices were sent to approximately six other web sites and all seem to have met with hostility and surprise from the web masters and those who frequent their sites.

Applying the fair use exception to the use of these audio clips involves a four-step analysis.iii First, the purpose and character of the use must be considered. In this case, the use is non-commercial and is most likely news reporting or parody in character. The second step in the analysis places the work on the spectrum of copyright. At one end are factual compilations which are not covered by copyright and at the other end are works of fiction or fantasy which are at the core of copyright. These audio clips are works of fiction and lie very close to the heart of copyright protections. Third, the amount and substantiality of the portion used is assessed. The audio clips are normally only a few seconds long but when considered in proportion to the fact that the weekly episodes are thirty minutes in duration, the substantiality increases. Finally the effect of the use on the potential market value of the original should be considered. It is likely that the official Fox King of the Hill web site would carry downloadable audio clips but considering that most web sites are not commercial ventures, a market value does not really come into play in this situation. Further, the audio clips on Gross’ site were not available for downloading. Considering these four factors together it appears that two weigh in favor of fair use and two weigh against. No one factor is given determinative weight but the fact that Gross’ use was not commercial works heavily in his favor.iv

However, fair use in cyberspace is a new question and there are no bright lines to follow regarding this issue. This traditional analysis has worked well with the existing copyright laws but if changes are made to fit those laws into the new world of cyberspace this analysis will most likely not work the same way.

The creators and users of fan sites were outraged over Fox’s attempt to stop them from using sound clips from their favorite shows. One fan wrote to Gross saying, "I think it sucks what they are doing…You only heighten the popularity of their show…What a bunch of dorks." This attitude is echoed in many of the comments that Gross has posted to his site. It is a common attitude among netizens that their activities are harmless because they are not done for profit. However this overlooks the possible market for software containing audio clips and art depicting characters from the show for use in screen savers and wallpaper, to name only one market. This attitude also overlooks the fact that networks do hold copyrights on their shows and that is a valuable commodity. Fox’s approach was meant to protect their rights. Until a creator of a fan site takes this issue before a court, it is unclear who is right and how the issue will be handled. In the mean time, the threat of suit will continue to cause web sites like Gross’ to close down.

Derivative Works

Another problematic area for copyright law in cyberspace is the creation of derivative works. Again, the two main culprits of this infringing activity are the lack of education about copyright law and the ease of accomplishing this type of infringement. Sites that contain fiction based on popular characters from television and film are gaining popularity in cyberspace with their counterpart fan sites. These sites are also butting heads with television network and movie studio attorneys generally for the same reasons. These large companies have enormous investments in their characters and the copyrights they hold entitle them, and only them, to make derivative works based on those characters.

A major reason this problem has become prevalent, is the ease at which anyone with a computer can become their own publisher. While in many respects this fact is beneficial for virtually everyone involved with cyberspace because it increases the information that makes cyberspace an appealing place, it also increases the likelihood that someone will publish a piece of fan fiction that is not desirable to copyright owners. It is not clear how this problem will be resolved. In her article entitled Scotty, Beam Down the Lawyers, Jennifer Granick reported that Lucasfilm "tolerates the publication of fan fiction, so long as the stories are not for commercial gain and don’t sully the ‘family’ image of the Star Wars characters." Presently under copyright law there is no way to distinguish between a pleasant derivative work and one that is not acceptable – such as the stories about Star Trek’s Captain Kirk’s love affair with Mr. Spock that Granick mentioned in her article.

It may very well be necessary that in the wake of this revolution called cyberspace for copyright law to be reformulated to fit into the new cracks and crevices that are created when the medium is digital. Until then, those netizens who are risk-averse will steer very clear of potentially infringing activities and those who are risk-takers will continue to disregard copyright. Those in the middle will be left to sort out the unclear boundaries of copyright law in cyberspace.

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i The Copyright Act of 1976, 17 U.S.C. s 102.

ii Id at s 107.

iii Id.

iv. Sony Corp. of America v. Universal City Studios, Inc. 464 U.S. 417 (1984).

Trademark Law as applied to Domain Names

By Brian C. Butler

As technological advances continue to increase at an exponential rate, the law is constantly struggling to adapt. In the area of trademark law, the rise of the World Wide Web as a commercial medium is making this struggle is more difficult. This phenomenon promises only to increase.

Some of the most heated disputes involving trademark law and the World Wide Web are over who will have the right to a particular domain name. Federal trademark and dilution law under the Lanham Act is far from adequately addressing this issue. In the near future, a new method for resolving these disputes will be needed.

Domain names are a convenient way for users to locate a particular Internet Protocol ("IP") address without having to remember a string of numbers. As David J. Loundy points out in "A Primer on Trademark Law and Internet Addresses", the purpose of these domain names is not to identify Trademarks, but to make user access to these locations simpler.i However, the prevalence of using a company’s Trademark as its domain name has meant that these domain names have become one of the ways that a user locates a particular site. For example, to locate Netscape’s main page, a user only needs to type in "netscape.com". Without ever having visited or seen reference to the site, a user can make a pretty good guess as to what a company’s domain name will be.

For examples of this see:

johnsonandjohnson.com

kmart.com

fritolay.com

walgreens.com

It is undoubtedly true that these sites could easily be accessed using a web browser like Yahoo! or Hotbot) but it would be difficult to access these search engines initially if their domain names did not correspond with their trademarks.

The importance of these domain names in increasing the ease at which a site is located has led companies to sue over the right to use a particular domain name. Most of these suits have included claims of Federal Trademark Infringement and Federal Trademark Dilution under the Lanham Act. (15 U.S.C.A. § 1114) However, these statutes are ultimately inadequate methods for solving these disputes.

The Lanham Act (15 U.S.C.A. § 1114) protects the owner of a Trademark from another entity’s commercial use where "such use is likely to cause confusion." (15 U.S.C.A. § 1114 (1)(a) & (b)). Courts generally apply several factors in determining "Likelihood of Confusion" such as: "(1) The degree of similarity between the marks; (2) The similarity of products or services for which the name is used; (3) The arena and manner of concurrent use; (4) The degree of care likely to be exercised by consumers; (5) The strength of complainants mark; (6) Actual confusion; and (7) Intent of alleged infringer to palm-off his products as those of another"ii

Section 43(a) of the Lanham Act gives federal protection for "Dilution" of a famous mark. (15 U.S.C.A. § 1125) To prevail on a claim of "Dilution" under §43(a), the plaintiff must show that the mark is famous, that the allegedly infringing use was commercial, and that there was "dilution."iii

(Click here for more information about the new dilution law.)

In the context of domain names, showing "Likelihood of Confusion" for purposes of Federal Trademark Infringement will, in most cases, be difficult. The reason for this is that –where only the domain names are similar—any confusion that existed as to the source of the goods or services will likely cease once the web site is accessed. Under the second factor above (for "Likelihood of Confusion") the existence of completely different "products or services" lessens the likelihood of consumer confusion. Where the "products or services" are similar, though, a finding of infringement is much more likely.

Federal Trademark Dilution under §43(a) (15 U.S.C.A. §1125) will be easier to prove than Infringement in this context because no "Likelihood of Confusion" need be shown. The major hurdles under Dilution Law would be showing that the infringing use was commercial and that the use constituted "dilution.

Thus far, relatively few cases have addressed these issues. One of the most noteworthy is Panavision, Int’l. v. Toeppen iv Dennis Toeppen, the owner of an Internet Service Provider (ISP) in Illinois, acquired the domain name "panavision.com" from Network Solutions, Inc. ("NSI") before Panavision International L.P. had an opportunity to do so.v Toeppen’s page contained nothing more than an aerial view of Pana, Illinois.vi When Panavision decided to begin doing business on the Internet, it discovered that Toeppen "owned" the domain name to one of its trademarks.vii Toeppen refused to give up this domain name unless he was paid $13,000. When Panavision refused to pay, Toeppen registered the domain name "panaflex.com" with NSI. This is another one of Panavision’s trademarks. This page contained only the word "hello."x

Panavision sued claiming, among other things, Federal Trademark Infringement under 15 U.S.C. § 1114 and Federal Trademark Dilution under 15 U.S.C. § 1125.xi The court did not reach the issue of Infringement, but found that Toeppen had violated federal and state dilution laws.xii In order to find that dilution existed, the court necessarily had to find that Toeppen’s use was a commercial use. The fact that Toeppen had apparently registered the domain names in order to demand money as a condition for them up was enough for the court to find that his use was commercial.xiii This is important because if Toeppen had acted completely without a profit-motive, his acts would likely have been outside the scope of Section 43(a) of the Lanham Act. The court’s finding of a commercial use in this case also represents its willingness to find a commercial use even where the alleged diluter was offering no goods or services at all.

The court also had to find that there was "dilution." (This is both the third prong of the test and the test itself.) 15 U.S.C. § 1127 defines "dilution" as "the lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence of (1) competition between the owner of the famous mark and other parties, or (2) likelihood of confusion, mistake, or deception."xiv The court in Toeppen looked at the two customary forms of dilution, "tarnishment" and "blurring."xv

"Tarnishment," the court pointed out, involves the use of a famous mark in connection with a product having a low level of quality or that is unwholesome.xvi "Blurring," the court noted, "involves a ‘whittling away’ of the selling power and value of a trademark by unauthorized use of the mark."xvii The court, however, did not use either of these theories to find that Toeppen had diluted the trademark.xviii Instead, the court found that Toeppen had "eliminate[d] the capacity of the Panavision marks to and distinguish Panavision’s goods and services on the Internet" and that in doing so he had diluted the mark. However, it is really not true that Panavision would have been deprived of the right to use its marks to identify its goods on the internet. Panavision could still have used its trademarks on the web page itself, or could incorporate its trademarks into another, similar, domain name. In fact, Toeppen’s use of Panavision’s marks probably would not lessen the capacity of the marks to distinguish Panavision’s goods or services at all. Since Panavision’s marks are truly "famous" marks, a consumer stumbling upon Toeppen’s sites, with there obvious intent to spoof Panavision, would likely be reminded of Panavision and its products.

Both in finding that Toeppen’s uses of Panavision’s marks was commercial and that the uses fit within the definition of "dilution," the court was straining to fit Toeppen’s acts within the scope of Section 43(a) of the Lanham Act. Such strained analysis makes bad law, and borders on the court legislating what it thinks the law should be.

The current dispute between Zero Micro and Microsoft Corporation raises similar issues. Zero Micro uses the domain name "micros0ft.com" (with a zero instead of an 'o' between the 's' and the 'f') on a web page that is critical of Microsoft Corporation and Bill Gates. David Loundy points out that "Zero Micro did not use a name that Microsoft wanted but could not get; rather, it used a name that Microsoft wishes no one had or could get."xx This dispute is probably outside the scope of Federal Trademark Infringement under the Lanham Act because there is very little likelihood that consumers will be confused as to the source of this particular use of a similar mark. Zero Micro’s page is clearly a parody of the Microsoft Corporation. No reasonably sophisticated web surfer would assume that Zero Micro’s page is associated with Microsoft Corporation. In fact, this is exactly the opposite of Zero Micro’s intent.

Most courts will consider what the consumers’ likely level of sophistication is when considering whether there is a "Likelihood of Confusion" (see factor number four above.) In this case, a consumer is unlikely to stumble upon Zero Micro’s page while looking for Microsoft’s page, and even if she did, the consumer would immediately know that she was in the wrong place.

Zero Micro’s use of a mark similar to Microsoft’s mark probably also falls outside of the scope of Federal Dilution Law under Section 43(a) of the Lanham Act. 15 U.S.C.A. § 1125. The reason for this is that Zero Micro’s use of the mark would likely be considered within the "news reporting and commentary" exemption to the law as a parody.xxi Parody is an important method of criticism and is generally held to be protected by the First Amendment.xxii

To visit Zero Micro’s site, click here.

For information on a dispute involving an Internet Service Provider in Northern Ireland and The Gap Incorporated clothing company click here.

In many situations, the Lanham Act, as it currently exists, will be an inadequate means of solving disputes between parties desiring the same second-level domain name. The reason for this goes to the heart of the traditional approach to trademark law. Ownership of a valid trademark is not ownership of the exclusive right to use the mark. It is, rather, the exclusive right to use the mark in a particular context. In other words, the same mark can be used simultaneously by two different entities so long as the marks are not used for competing goods or services.xxiii This is problematic in the context of domain names because only one of potentially multiple holders of the same trademark can have a directly corresponding second-level domain name. Section 43(a) of the Lanham Act protects a trademark owner from "dilution." However, as is evident in the strained analysis in the Toeppen case, this too will likely be an inadequate means of solving these disputes.

Effective September 8, 1997, Network Solutions, Inc. ("NSI") –the company licensed by the National Science Foundation to distribute second-level domain names-- instituted a new policy for dealing with disputes involving domain names. The Domain Name Dispute Policy states that NSI will continue the "First come, First served" basis for handing out second-level domain names. NSI will also continue its policy not to determine the legality of a domain name registrants use of a particular domain name.xxv

Under the new policy, where registration of a domain name by NSI allegedly violates the legal rights of a third party, that party must supply NSI with a certified copy of a "United States Principle or foreign registration" to prove a valid Trademark and give prior notice to the domain name registrant stating that the domain name violates the third party’s legal rights. (see "Domain Name Dispute Policy") When this has been done, NSI will determine whether the activation of the domain name is after the earlier of (1) the date of first use of the third party’s Trademark or (2) the effective date if the certified registration.xxvi If it is after the earlier of those two dates, then the registrant will be given an opportunity to show evidence of its own Trademark registration which was before the earlier of (1) NSI’s request for proof of ownership or (2) another party notified the registrant of a dispute.xxvii

If the registrant does not provide this proof of Trademark registration within 30 days, NSI will assist the registrant in attaining a new domain name, and registrant will be able to use both domain names for 90 days.xxviii Then the old domain name will be put on "hold" pending the result of the dispute.xxix

NSI's policy of assigning second-level domain names on a "first come, first served" basis and then letting the courts clean up the mess is clearly inadequate and will lead to inequitable results. NSI's policy allows a non-commercial "squatter" to apply for domain names using another entity's trademark, and effectively deny the trademark owner the right to use its trademark as the domain name for its web page. The reason is that no federal law currently would prevent this.

NSI ought to be required to make some good faith effort to ensure that priority is given to holder's of a valid trademark in distributing domain names. Its current policy of relying on the assertions of the registrants is not enough. This will not be an easy task considering the large number of applications for second-level domain names that NSI receives each year. However, given the reality that domain names are an important way for consumers to locate a particular site, this is the only responsible approach. Inevitably, the law will also have to address this issue. If encouraging commerce on the Internet is desirable, an equitable means for distributing domain names that have commercial value will need to be developed.

For general information regarding Trademark Law and Domain Names see:

Internet Domain Names and the Law

Trademark issues in Cyberspace:The Brave New Frontier by Sally M. Abel and Connie L. Ellerbach

Are Trademarks Lost in Cyberspace? By Annette M. Mulee

For criticism of NSI and its "Dispute Name Dispute Policy" see"

EFF Position Statement on Internet Domain Name System Policy and Evolution

and

Analysis and Suggestions Regarding NSI Domain Name Trademark Dispute Policy by Carl Oppedahl (note: this was published before the new policy came out.)

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i "A Primer on Trademark Law and Internet Addresses"

ii. Forum Corp. of N. Am. v. Forum, Ltd., 903 F.2d 434.

iii. See Panavision Int'l v. Toeppen, 945 F. Supp. 1296.