House Subcommittee Approves Anti-Cybersquatting Bill

(October 12, 1999) The House Courts and Intellectual Property Subcommittee approved HR 3028, the Trademark Cyberpiracy Prevention Act, on Thursday, October 7, 1999. The bill is very similar to the anti-cybersquatting bill which passed the Senate on August 5.

The House Courts and Intellectual Property Subcommittee approved HR 3028 IH, the Trademark Cyberpiracy Prevention Act, by a unanimous voice vote, without amendment, on Thursday morning, October 7, after a short discussion. The bill was introduced just prior to the markup. The full Judiciary Committee is scheduled to mark up the bill on October 13.

"This is an important piece of legislation," said subcommittee Chairman Howard Coble (R-NC) in his opening statement. "Over the past two years, this Subcommittee, through a series of oversight hearings, has become very aware of the problems faced by owners of famous marks when dealing with the issue of domain names. Time and time again we heard stories of cyberpirates who registered numerous domain names containing the marks or trade names of American companies only to hold them ransom in exchange for money."

"Sometimes these pirates will even put pornographic materials on these sites in an effort to increase the incentive for the trademark owner to protect the integrity of its mark. The time has come for this practice to stop," said Rep. Coble.

Rep. James Rogan (R-CA)

Rep. James Rogan (R-CA), the sponsor of the bill, explained HR 3028 in his opening statement. "This legislation specifically prohibits registration, trafficking in, or use of a domain name that is identical to, confusingly similar to, or that dilutes a mark that is distinctive at the time that the domain name is registered. HR 3028 sets a standard for enforcement when a bad faith intent to profit from the good will associated with that mark is shown."

"Legislation clarifies the right rights of trademark owners with respect to bad faith, abusive domain name registration practices, and provides clear deterrence to prevent this bad faith conduct. Furthermore, the property interests of trademark owners are balanced with the interests of Internet users. A number of balancing factors are set forth which a court may wish to consider in decided whether the requisite bad faith intent is present. If the court finds bad faith by a domain name holder, trademark owners can seek the forfeiture, cancellation, or transfer of an infringing domain name."

Rep. Howard Berman (D-CA), also spoke in favor of the bill. He also stated, "I think it is also important to recognize the work ICANN is doing to establish a uniform dispute resolution mechanism for domain name registrars. I hope that that process yields mechanism that will be truly effective in protecting trademarks. There sometimes are legitimate disputes." However, he added that the situation that HR 3028 deals with "is not that kind of dispute. It is essentially a legal form of extortion."

Rep. Rick Boucher (D-VA) is the lead cosponsor of HR 3028. He was also involved in the drafting. He stated that "under current law it is hard for a trademark owner to pursue someone" who has registered his trademark name. "The legal remedies are both expensive and uncertain, and many trademark owners conclude that it is simply easier to pay the cybersquatter his ransom, and in effect buy his own trademark name, than it is to pursue his legal remedies in court."

"Mr. Rogan and I want to put the cyber-squatters out of business by providing a more certain legal remedy to trademark and servicemark owners," concluded Rep. Boucher.

Rep. Zoe Lofgren (D-CA) stated that "this measure does not actually change trademark law; it merely creates a more accessible remedy, or tool, to those who have been victims of trademark violations."

The closest thing to criticism of the bill came from Rep. Bob Goodlatte (R-VA), a cosponsor of the bill, who said "I would, however, like to see it go further than it goes."

"I think we could expand that legislative authority beyond trademarks," said Rep. Goodlatte, "to the names of individuals." He cited the case of Mother Teresa. As of the writing of this article the URL http://www.motherteresa.com/ returns a page that contains the following information:

Rep. Goodlatte pointed out that this sort of practice is not be covered by the bill.

Several members of the subcommittee also pointed out that the bill would not offer Members of Congress any protection against cyber-squatters who use their names, as they are not trademarked. For example, there are at least two such sites which defame Rep. Rogan. See, http://www.jimrogan.com/ and http://www.rogan4congress.com/.

Rep. Rogan's Congressional web site is at http://www.house.gov/rogan/, while his campaign web site is at http://www.jimrogan.org/. Tech Law Journal's biography of Rep. Rogan is at http://www.techlawjournal.com/people/rogan.htm.

Finally, Rep. Chris Cannon (R-UT) stated that "I intend to support this bill out of subcommittee, but there are several concerns that I have." He cited only the "in rem part of the jurisdiction."

The bill allows a victim of cybersquatting to bring a suit solely against the property (the domain name) when the victim cannot locate, serve, or obtain personal jurisdiction over the perpetrator. In these actions, the remedy would be limited to transfer of the domain name. Rep. Cannon did not specify whether he wanted to limit or expand this provision.

HR 3028 IH is essentially the same bill that passed the Senate in August, S 1255, sponsored by Sen. Spencer Abraham (R-MI).

There are several changes, however.

• HR 3028 does not contain the statement of purposes listed in S 1255.
• HR 3028 does not contain the severability section contained in S 1255.
• HR 3028 lists several more factors that may be considered by courts in determining whether a person who has registered the trademark name of another has acted in bad faith.
• HR 3028 covers not just domain names that are the same as or similar to registered marks, but also covers a name protected by reason of section 706 of title 18 or section 220506 of title 36.

The members of the subcommittee who participated in the meeting, and who were present for the vote were Howard Coble, Howard Berman, Mary Bono (R-CA), Rick Boucher, Chris Cannon, John Conyers (D-MI), Bob Goodlatte, Bill Jenkins (R-TN), Zoe Lofgren, Ed Pease (R-IN), Jim Rogan, and James Sensenbrenner (R-WI).