Was $7.5 Million a Good Deal for Business.com? the Difficulties of Obtaining Trademark Protection and Registration for Generic and Descriptive Domain Names

By Branson, Christie L. | Santa Clara High Technology Law Journal, May 2001 | Go to article overview

Was $7.5 Million a Good Deal for Business.com? the Difficulties of Obtaining Trademark Protection and Registration for Generic and Descriptive Domain Names


Branson, Christie L., Santa Clara High Technology Law Journal


I. INTRODUCTION

There are approximately 83.3 million users of the Internet in the United States. (2) By 2002 that number is expected to exceed 165 million Internet users in the United States alone. (3) As a result of this increasing use of the Internet by Americans, many business entrepreneurs are moving all or part of their endeavors to an Internet web site. With the number of web sites growing exponentially, dotcommers (4) seeking a name for their business web site that is both catchy and memorable are finding such domain names increasingly limited. (5) Even if a dot-commer is lucky enough to register a catchy domain name, there is no guarantee that trademark and unfair competition laws will provide protection against another party choosing a confusingly similar mark or dilutive domain name. The controversy surrounding the domain name illustrates this dilemma.

eCompanies bought the domain name for $7.5 million from a Houston media entrepreneur who paid $150,000 for the domain name in 1996. (6) The co-founder of eCompanies, Jake Winebaum, indicated that the purchase of was not rash because requires much less marketing than other domain names. (7) What Jake Winebaum did not realize is that generic or descriptive domain names like are not entitled to trademark protection or registration in the United States. While may be an easy name to remember, other companies offering similar business-to-business services could create a company with the domain name or and compete directly with eCompanies. Customers of eCompanies could easily be led to the other competing sites and become confused as to which is the original.

Due to recent policies regarding trademark protection and registration for domain names implemented by the United States Patent and Trademark Office (USPTO), (8) it is unlikely that eCompanies can prevent this scenario: the operation of competing businesses with confusingly similar domain names. This comment seeks to explore the challenges, under current policies and case law, of registering generic and descriptive domain names on the USPTO's Principal Register and to examine how unfair competition laws apply to the protection of generic and descriptive domain names.

II. BACKGROUND

A. What is the Internet?

In the late 1960s the United States Defense Department's Advanced Research Projects Agency began networking computers together to transfer information. (9) After many years of research, the result was the ARPANET, a system created to tie incompatible networks together. (10) This system became the backbone for the modern day Internet. (11)

Each computer on the Internet is assigned a unique Internet Protocol (IP) address. (12) When information is distributed over the Internet, it is split into packets containing the IP address of the computer to which it is sent. (13) In the mid-1980s the domain name system (DNS) was created to manage the IP addresses of computers and networks. (14) As a result of continued development of the DNS, IP addresses can now correspond to alphabetic addresses (15) making human memorization of computer domain names much easier. (16)

For example, instead of remembering the numerical IP address 128.10.2.1, one merely needs to recall the domain name --the alphabetic equivalent of the computer with the IP address of 128.10.2.1. (17) Unfortunately, because there is no obvious correlation between the IP address and the words in a domain name, confusion often arises. (18) The number '128' in the above mentioned IP address has no correlation to the word 'arthur' in the domain name. (19) This makes it difficult for users to remember the IP address which is why most users choose to use the domain name to locate a particular computer on the Internet. …

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