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Are Domain Names Contract of Services or Property Rights?

Duksh K. Koonjoobeeharry

There are several perspectives from which one can give various answers to the question of 'what are domain names?'. Originally the domain name system started and continues to be a human-friendly way of addressing to a set of machines or specific machine connected to the Internet. Hence, from the technical perspective, a domain name is simply an address consisting of a combination of alphanumeric and symbols to communicate with a machine which also happens to be hosting certain services in form of data and information on it.

Indirectly that machine or its hosted services can also act as a gateway to a network of other services and machines. The above perspective can be considered as the parent perspective from which comes the business perspective and legal perspective. As a starting point, the domain name takes birth via the domain registrar and the registrant after going through the registration process which is done online in a lapse of minutes consisting of:

  1. Entering desired domain name to be checked for availability from database;
  2. Checking availability from the database;
  3. If domain name is available, select service plan consisting of terms and conditions along with duration of plan and service fee;
  4. Pay online;
  5. Configure the Domain Name Server (DNS) to associate the domain name.

The above is all it takes for anyone to get a domain name from a domain name registrar at any time and day. The issue of whether the domain name becomes a services contract, more than property rights or vice versa, comes next.

Trademarks and the owner

A trademark is always attached to an entity representing the owner and a quality attached to a product or service. On its own, the trademark has no value if separated from its goodwill. Every country and its different jurisdictions have their own laws regulating trademarks. Can a trademark be used as a domain name? Yes. Can a domain name become a trademark? Not really, as the domain name is not owned by anyone, it is only licensed to be used as an address by the registrar to the registrant for a limited time only.

Bundle of Rights

Breaking down some of the various bundles of rights enjoyed by stakeholders related to trademark and domain names. Several of these rights can be transferred between different parties through sales or trade.

1) Regulatory Body (ICANN):

  • Right to license registrant
  • Right to amend the UDRP
  • Right to amend the ICANN Bylaws
  • Right to publish root zone server

2) Domain Name Registrars:

  • Right to change service fee
  • Right to amend service contract
  • Right to impose UDRP on registrant

3) Domain Name Registrant:

  • Right to register an available domain name
  • Right to not publish the domain name (no website attached to that domain name)
  • Right to configure the domain name to point to the desired machine
  • Right to control access to service provided via that domain name
  • Right to use the domain name for advertising
  • Right to sell the domain name

4) Trademark Owner:

  • Right to register an available domain name
  • Right to not publish the domain name (no website attached to that domain name)
  • Right to configure the domain name to point to the desired machine
  • Right to control access to service provided via that domain name
  • Right to use the domain name for advertising
  • Right to sell the domain name

5) Public:

  • Right to access the service provided via the domain name
  • Right to provide reviews and comments about service/website provided via the domain name
  • Right to fill report of spamming against a domain name

6) Internet Intermediaries (ISPs/ Search engines):

  • Right to allow access to the website
  • Right to block access to the concerned domain name

Does the 'bundle of rights' makes the domain names service contract rights or property rights?

The following cases (in chronological orders) will provide different angles through which the question of whether the 'bundle of rights' makes the domain names service contract rights or property rights, can be answered:

1) Dorer v Arel, 60 F. Supp. 2d. 558 (E.D. Va.1999).

Rose Marie DORER and Forms, Inc., who were the plaintiffs filed a trademark infringement action in the jurisdiction of Virginia state against Brian AREL the defendant for using the domain name 'writeword.com'. The court decided to ban the defendant from using the domain name and made the defendant pay $5000 to the plaintiffs. But the plaintiffs also wanted to have their share from the profit which might have been derived from the domain name use, but the court denied that request as there was no lien between the domain name and the defendant's property. In this case, the domain name was a contract of service from NSI.

2) Umbro International v 3263581 Canada, 48 Va. Cir. 139 (1999).

This case which at a point turned out to be a case of cybersquatting during which the court had to deal with a situation of whether a contractual right to use an Internet domain name (in this case 'umbro.com') could be garnished from NSI (the registrar) according to Umbro International. But the court decided that as it was not a liability but rather a contract of services provided by NSI as registrar to the registrant there should be no garnishment.

3) Gary Kremen, et al. v. Stephen Michael Cohen, et al. No. 01-15899 (9th Cir., July 25, 2003).

This case was one where a forgery took place and the plaintiff was ordered to be compensated by the defendant who went away without following the order after which the plaintiffs decided to go after the NSI (the registrar) for compensation. But as the registrar was found to be a party having no gain and interest in the domain name, the registrar was saved by its contract of services.

4) Barcelona.com Incorporated v. Excelentisimo Ayuntamiento de Barcelona (The City Council of Barcelona, Spain) 330 F.3d 617, Civ. No. 02-1396 (4th Cir., June 2, 2003).

This case had an international angle with conflicting laws in a specific jurisdiction. 'barcelona.com' was ordered to be transferred to 'Excelentisimo Ayuntamiento de Barcelona' on the basis of cybersquatting but later on, the decision was reversed on the basis of Spanish law being applied in a US jurisdiction where the court did not find the domain name to be infringing the claimed trademark.

5) Audi AG and Volkswagen of America Inc. v. Bob D'Amato 469 F.3d 534, No. 05-2359 (6th Cir., November 27, 2006).

This case was purely one of trademark infringement in which the defendant's, without proper permission, had used the Audi trademark and logo on a website having a trademarks infringing domain name.

6) Tucows.Com Co. v. Lojas Renner S.A., 2011 ONCA 548 (CanLII).

To sum up, I'd like to use 2 of the following quotes which say it all.

"A number of courts have — not surprisingly - concluded that domain names are service contract rights."

"As someone mentioned in a forum discussion about this, the door swings both ways. Whether domain names should be considered property or not, and whether it's good or bad, depends on what side you're on." Dave Zan, Dec 23, 2005 on circleid.com

* * *

Bibliography

1) Dorer v Arel, 60 F. Supp. 2d. 558 (E.D. Va.1999). Available at <http://www.leagle.com/xmlResult.aspx?xmldoc=199961860FSupp2d558_1557.xml&docbase=CSLWAR2-1986-2006#FR_9>

2) Umbro International v 3263581 Canada, 48 Va. Cir. 139 (1999). Available at <http://www.courts.state.va.us/opinions/opnscvwp/1991168.pdf>

3) Gary Kremen, et al. v. Stephen Michael Cohen, et al. No. 01-15899 (9th Cir., July 25, 2003). Available at <http://www.internetlibrary.com/pdf/kremen-cohen-9th-cir.pdf>

4) Barcelona.com Incorporated v. Excelentisimo Ayuntamiento de Barcelona (The City Council of Barcelona, Spain) 330 F.3d 617, Civ. No. 02-1396 (4th Cir., June 2, 2003). Available at <http://www.internetlibrary.com/pdf/Barcelona.com-Excelentisimo-Ayuntamiento-4th-Cir.pdf>

5) Audi AG and Volkswagen of America Inc. v. Bob D'Amato 469 F.3d 534, No. 05-2359 (6th Cir., November 27, 2006). Available at <http://www.internetlibrary.com/pdf/Audi%20D'Amato.pdf>

6) Tucows.Com Co. v. Lojas Renner S.A., 2011 ONCA 548 (CanLII). Available at <http://www.canlii.org/en/on/onca/doc/2011/2011onca548/2011onca548.pdf> last accessed on 11/02/2013 7) Comment from Dave Zan on 'Is a Domain Name Property?', 23 December 2003. Available at <http://www.circleid.com/posts/is_a_domain_name_property/>

By Duksh K. Koonjoobeeharry, Team Lead, Open Source Geek, Internet Legal Research
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