Welcome back to Legal Geek. This week, we review the ever-expanding world of generic top level domains and how the new system may be a true drain on the economy and trademark rights.
https://archive.org/details/LegalGeekEp44
As recently as a few years ago, protecting a company name or a brand on the internet was not that difficult, as there were only a handful of possible gTLD's that could be used, like .com, .org, and country-specific codes like .co.uk. But ICANN, the organization who controls these things, started opening the opportunity to have many other words or suffixes behind the dot in website addresses, and that has had a profound effect on the way companies protect brands online.
As a threshold question, one wonders if this whole opening of new gTLD's is nothing more than a money scam. For companies who want to buy up the rights to their name in a new gTLD, like the .sucks domain that is about to go live, they have to pay $2500 in an initial sunrise period or else the domain name could be bought later on the open market for around $10. That price disparity, and the ever growing number of different gTLD's, makes it economically infeasible for companies to lock down every potential domain name, especially when also trying to cover common misspellings and alternative brands or names.
When .xxx was opened as one of the first new gTLD's, a high number of companies paid this extra money to prevent potential porn knockoffs using their brands. But with the seemingly similar .sucks domain this year, many companies have just given up trying to control everything. But that raises an interesting question under some national trademark laws like the U.S.
One of the obligations for trademark owners in the U.S. is not only to keep using the mark in commerce, but also to police others using the mark. If sufficient care is not taken to object to potential infringers over time, the trademark owner is assumed to have approved this type of competing use. If that happens enough, the trademark may become diluted or tarnished enough to not really reliably identify the source of goods or services anymore. And that's where a trademark gets invalidated.
So is the continued expansion of possible gTLD's actually providing any value anymore, or is it just creating a cybersquatting haven that becomes a monetary drain and nuisance for companies who need to protect and enforce their most valuable trademarks and brands? It seems the scales are tilting towards the latter, unfortunately.
The Bottom Line: just like with all new areas or expansions related to IP law, new gTLD's likely need some form of regulation to avoid this becoming a Napster-level cesspool filled with nothing but brand trolls, shameless profiteers, and increased unnecessary litigation. Figuring out how to do this logically is a whole different story, but let's hope it gets figured out soon!
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Thanks for reading. Please provide feedback and legal-themed questions as segment suggestions to me on Twitter @BuckeyeFitzy
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