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Trademark Law And The Internet sample essay


The Internet and the World-Wide Web have been the greatest breakthroughs in telecommunication technology in the last century. The rate at which the web has grown is an indicator of its popularity and importance in the world of today.
Brief history of the internet

The foundations of the internet were laid when a US military agency called the Advanced Research Projects Agency (ARPA) was given the task of maintaining communications in the even of a nuclear war. They devised a communication system which was like a web, in the sense that if one link or node of the system was broken, information could still flow around the broken link to reach its destination. In 1969, ARPA linked university computers to the network to help them in carrying out the basic research via a system known as ARPANET.

In 1977, a new communication technology was developed known as TCP/IP or transmission control protocol/internet protocol. In this system, packet switching networks came into play where transmitted data was broken into smaller parts called ‘packets’, sent to its destination and then reassembled at the other side. Packets were further compressed for speed and encrypted for security. This was also around the time that USENET, a popular bulletin-board system was developed. USENET contributed much to the rise in popularity of the Internet. (Shannon, n.d)

In 1983, the ARPANET system changed over to TCP/IP and became what is officially now known as the Internet. The US National Science Foundation funded most of the earlier development of the net but in 1995; it was handed over to commercial networks and service providers.

In 1991, the concept of the World-Wide web was introduced by Tim Berners Lee who proposed a new set of protocols, envisaging the need for a standard linked information system accessible across the range of different computers. These protocols were; http (hyper text transfer protocol), ftp (file transfer protocol), pop (post office protocol), smtp (simple mail transfer protocol) and nntp (newsgroups protocol). These five protocols became known as the World Wide Web protocols and the W3 protocols and were soon adopted by the early Internet community.
Brief history on the commercialization of the internet

As Shannon (n.d) points out, it was at this point in time that researchers got interested and started designing web sites and browsers. In 1993 the National Center for Supercomputer Applications (NCSA) developed the first proper web-browser, Mosaic. This immediately initiated a large increase in web usage. Services were set up for domain registration and sites were developed, running on very basic HTML. The web had an incredible 341, 634% annual growth rate. Important sites like the White House and Pizza Hut appeared and realizing the future of business on the net, several online shopping sites were seen.

It was around 1995 when the first large ISPs like AOL and CompuServe began offering Internet access to the masses. Technology like Sun’s Java and search engines were released. The browser war was in full swing between Netscape and Microsoft, with new browser releases coming every month and the web becoming increasingly fragmented. Commercial efforts mainly comprised vendors providing the basic networking products, and service providers offering the connectivity and basic Internet services.

Today, the web is still growing at an amazing rate. Technology has improved considerably, and the web is regarded as an indispensable tool for education, business and entertainment. The Internet has now however become almost a “commodity” service, and much of the latest attention has been on the use of this global information infrastructure for support of other commercial services. This has been tremendously accelerated by the widespread and rapid adoption of browsers and the World Wide Web technology, allowing users easy access to information linked throughout the globe. Products are available to facilitate the provisioning of that information and many of the latest developments in technology have been aimed at providing increasingly sophisticated information services on top of the basic Internet data communications.

According to Greenstein (2001) commercialization of the Internet developed well because of a number of reasons. First, commercializing Internet access did not give rise to many of the anticipated technical and operational challenges. Entrepreneurs quickly learned that the Internet access business was commercially feasible. Second, Internet access was malleable as a technology and as an economic unit. Third, privatization fostered attempts to adapt the technology in new uses, new locations, new market settings, new applications, and in conjunction with other lines of business.

These went beyond what anyone would have forecast by examining the uses for the technology prior to 1992. Fourth, and not trivially, the National Science Foundation was lucky in one specific sense. The Internet access industry commercialized at a propitious moment, at the same time as the growth of an enormous new technological opportunity, the World Wide Web. As it turned out, the Web thrived under market-oriented, decentralized, and independent decision making.
Copyrights and trademark protections effect on the commercialization of the internet

Commercialization of the Internet and World Wide Web has brought to the fore commercial owners of websites who have concentrated their efforts in searching for revenue models that allow them to maximize profit from Internet dealings (Rourke, 1998). This has raised challenges for the law, especially in the areas of copyrights and trademark law.

“The growing international and transnational nature of commerce, the spread of digital technology, and the ubiquity of the Internet, which together have provided a fertile ground for new trademark battles, have accompanied a broad legislative and judicial expansion of fundamental trademark concepts.” (Rourke, 1998).

Copyright is the right given by law to the creators of literary, dramatic, musical and a variety of other works of mind. It ordinarily means that the creator alone has the right to make copies of his works or alternatively prevents others from making such copies. Moreover, commercial exploitation of copyrights yields pecuniary rewards to the individuals’ creativity. The primary laws governing copyright in the United States are (Barnhart, 2002):
U.S. Copyright Act of 1976—which provides for protection of an original work once it is fixed in a tangible form and does not require that the copyright be renewed.
The Berne Convention Implementation Act—provides that works published after March, 1989 do not have to include a copyright notice.
The Sonny Bono Copyright Extension Act—provides an extension to the term of a copyright from the life of the author plus 50 years to the life of the author plus 70 years (for works created after January, 1978).
The Digital Millennium Copyright Act—prohibits circumvention of technology security devices and provides exemptions for certain uses of copyright protected material on the internet.
Title 37 of the U.S. Code of Federal Regulations—governs how copyrights are registered and applied.

As the Gartner study says, fair use of a copyrighted work does not require the creator’s permission. Such use includes criticism, commentary, news reporting, teaching, research and certain personal uses. However, the Copyright Act does not specify which uses are fair. Those issues are adjudicated case-by-case, based on a four factor balancing test.

The four factors are: (i) the purpose and character of the use, (ii) the nature of the copyrighted work, (iii) the amount and substantiality of the portion used in relation to the copyrighted work as a whole, and (iv) the effect of the use on the potential market for, or value of, the copyrighted work. This last distinction is critically important in an era of rapidly evolving technology. Consumers may consider certain uses of copyrighted digital media as fair, such as making back-up copies of a DVD. But in many instances, the law is not definitive. Congress has responded to the confusion with legislation aimed at protecting the rights of copyright holders while also respecting the traditional limitations of copyright. (Gartner Study, 2003)

A trademark is an identification symbol which is used in the course of trade to enable the purchasing public to distinguish one trader’s goods from similar goods of other traders. The word mark includes device, brand, heading, label, ticket, name, signature, word, letter or numeral or combination thereof. The Trademark Act was enacted to ensure that the proprietor of the mark has a monopoly right over the mark as an indication of the trade source or origin of the goods. The importance of the Trademark lies in its use in identifying goods with a certain source. Trademark registration helps in repressing the practice of passing off or misrepresentation whereby another appropriates the established reputation of one producer.

The trademark gives the consumer a guarantee of identity of origin of marked products by enabling him to distinguish the product, with no risk or confusion, from products of different origin. The trade mark system is valuable in connection with complicated consumer durables or with products marketed in sealed packages or containers. It is helpful to convey information about unusual conditions of sale such as warrantees or guarantees or other buyers’ options, thus adding to the buyer’s information. It is recognized as incorporeal property and can be assigned or transmitted under certain conditions.

Commercialization of the Internet and World Wide Web has brought to the fore numerous issues concerning trademark protection in cyberspace. In addition to trademark or trade name infringement claims based on use of a deliberately co-opted or a confusingly similar

Domain Name, questions of priority of use, and what constitutes use sufficient to establish trademark rights are becoming legion. The courts are only now beginning to address these issues, which may ultimately require a reformulation of traditional legal principles in step with the realities of an ever growing cyberspace marketplace (Abel, 2004).

As outlined in an article written by Ryan Isenberg (2001) “Traditional trademark infringement actions are brought under the Lanham Act on a cause of action for infringement of registered marks, while Section 43 covers unregistered marks, claims for dilution and now cyber squatting.”

There are now several special problems in trademark that result from “use in commerce” over the Internet, which has now expanded to include four unique areas: domain names, hyperlinks, meta tags, and framing. This is of course in addition to the traditional trademark cases that may arise. Here, “use” on an Internet website seems to essentially fall within the definition prescribed by the Lanham Act’s “use in commerce” language as it is typically applied in the general market setting. Despite this difference in character, trademark infringement over the Internet stems from the same roots such as dilution and unfair competition.
Trade secrets

A trade secret is information of any type that is actually or potentially valuable to its owner, not generally known or readily ascertainable by the public, and for which the owner has made reasonable efforts to keep it secret. A trade secret generally has some cost associated with its development, and is not common knowledge in the industry. Even negative information, such as research options that have been explored and found worthless, can be trade secrets. Practically any type of technical and business information may be protected as a trade secret provided it meets these requirements.

A trade secret may comprise of a combination of characteristics and components, each of which, by itself, is in the public domain, but where the unified process, design and operation of such characteristics, in combination, provides a competitive advantage. Inventions and processes that cannot be patented can be protected as trade secret. Companies rely on trade secrets to safeguard details of research and development including draft patent applications. Even after grant of a patent, the associated knowledge is protected as a trade secret. (Jaiya, n.d).
Encryption technology

Encryption is the translation of data into a secret code, a method of scrambling information so that only the intended receiver can use it. It uses algorithms to mathematically combine “keys” with plain text to form encrypted or cipher text. Encryption is the most effective security device because one has to have a specific key to unlock the data. Any digital data can be encrypted, including email messages and computer files. There are two main types of encryption

Symmetric: or Secret key encryption where the sender uses a secret key (a large binary number) algorithm to mathematically encrypt the communication and the receiver uses the same key to decrypt it. It is relatively fast and small, and is often generated in Web browsers each time they open a secure transaction.

Asymmetric: or Public key encryption where the message is encrypted with a public key and a private key is used to decrypt the same message. This protocol is used with Secure Sockets Layers (SST) technology, which is the standard protocol for secure Web-based communications.
Digital Rights Management

As Lohmann (2002) shows, Digital Rights Management (DRM) has evolved to satisfy the demands for intellectual property protection of digital content. The DRM platform primarily uses encryption as the underlying mechanism for securing access to digital content. A number of third-party technologies exist which could be utilised, and a combination of factors affects the suitability of each technology for use in a given scenario. These include target client platform, security, licensing and pricing requirements.

DRM technologies are aimed at increasing the kinds and/or scope of control that rights-holders can assert over their intellectual property assets. In the wake of the Digital Millennium Copyright Act’s (DMCA) ban on the circumvention of DRM technologies used to control copyrightable works, DRM restrictions are now backed up with the force of law. In essence, copyright owners now have the ability to write their own intellectual property regime in computer code, secure in the knowledge that the DMCA will back the regime with the force of law. One definition of DRM provided by LaMacchia (2002):

“The ultimate goal of a distributed DRM system is for content authors to be able to project policies governing their content into remote environments with confidence that those policies will be respected by the remote node.”

The advent of e-commerce has lead to the development and promotion of online advertising, which is not only cost-effective but also allows businesses to give more information to potential customers than the traditional forms of advertising such as through mass media and publications. There are two aspects to online advertising, namely legitimate and illegitimate.
Legitimate internet advertising: includes search-based advertising such as sponsored links and paid-for-search listings and banners and pop-ups that appear as separate windows generated by ad ware. These normally appear automatically on browser windows when surfing the net.
Illegitimate internet advertising: comprises of spamming which is the practice of flooding the internet with messages to individual email users or to different user groups who would otherwise choose not to receive it. The sheer volume of spam sent daily poses a problem to Internet Service Providers due to the consumption of bandwidth and slowing down of internet access which otherwise could be avoided.
Effects of Legitimate and Illegitimate advertising: The Web has turned into a marketplace and in the process through advertising transformed privacy into a commodity too. Use of cookies to gain personal information of the consumer, and spamming to send unwanted information pose a serious problem impinging on the privacy of consumers’ world-wide. However, on the positive side, suppliers, distributors and retailer have profited from the advertising on the net, whether it is from expanding traditional businesses into virtual ones or accessing global markets. Consumers too have benefited by accessing a global market place. They can shop online from the comforts of their home, get the latest updates on products, get lower prices because of global price competition, and lower transaction costs.
Open Source: According to Hutter (1998), the proponents of the “open source” approach (project it as a radically different approach to pricing in the Net. It is argued that the benefits for the total Internet community and for the originator of a new tool are largest when the tool is made available at zero price, possibly with aids for easy downloading. This way, the largest possible distribution is achieved. Private revenue can still be generated through special services, like customized installations, proprietary licenses and exclusive training courses. With such an approach, new tools can be improved and updated by all their users. Hutter says that open-source appeals to the university-based inventor who considers it part of his responsibility to distribute the knowledge contained in a publicly funded project, and it appeals to commercial competitors who are not large enough to defend their own network.

The use of the law to protect and promote the commercialization of the internet
The Audio Home Recording Act (AHRA) of 1992 was developed to meet the interests of both the recording industry and those of consumers, who were then represented by the Home Recording Rights Coalition (HRRC). The primary concern of the recording industry was preventing the propagation of consumer electronics devices capable of reproducing sound with perfect quality. According to the Gartner Study (2003), the AHRA
requires that digital audio recording devices include a system that prohibits serial copying,
establishes a royalty on sales of new digital audio recording devices, payable to the recording industry, and
provides a safe harbor for consumers’ personal use.

Technology, however, has outstripped the AHRA and made it ineffective as an enforcement mechanism for the recording industry. It has also proven ineffective as a defense for companies that provide file-sharing services to consumers. A significant problem is that many devices do not fall within the scope of the AHRA since it covers “digital audio recording devices,” but excludes many others. Other new devices, such as MP3 players, are not included because they are capable only of playing material uploaded to them, rather than of reproducing material on their own.

In recent litigation, Napster argued unsuccessfully that its file-sharing services did not fall within the AHRA’s scope, setting a problematic precedent for other companies. Accordingly, the AHRA is becoming irrelevant to legal conflicts involving the digital distribution of music.
The Digital Millennium Copyright Act

THE DMCA reinforced protections against unauthorized access to copyrighted material, and provided an additional layer of legal protection to copyright holders beyond the protections granted by the Copyright Act. The DMCA:
Makes it a crime to circumvent the technological measures that control access to copyrighted works
It also criminalizes the manufacture and distribution of any technology or tool designed to circumvent encryption a digital format
These restrictions apply even to individuals who create or use a circumvention tool to make a legal or fair use of encrypted material.

The Gartner Study (2003) shows that thought there are a few narrow exceptions, the provisions do not adequately protect users who want to make legitimate use of copyrighted materials. Section 512 of the DMCA does provide certain safe harbors to online service providers, defined as “a provider of online services or network access, or the operator of facilities thereof.”

Internet service providers (ISPs), Web-hosting services and search engines are all types of online service providers. So long as these providers have a “copyright agent” to respond to requests by copyright holders to remove infringing materials and follow the Act’s procedural requirements, the providers are protected from liability for users’ infringement by the Act’s safe harbor provisions. This procedure is referred to as “notice and takedown.” Still, an online service provider may not be liable for its users’ infringing acts, even if the provider does not follow the Act’s safe harbor requirements, because the legal standards for contributory or vicarious liability may not be met. The safe harbor provisions merely provide an optional measure of security for online service providers.

In addition to proscribing circumvention of access controls and the creation or distribution of tools for such circumvention, the DMCA regulates the broadcast of digital audio transmissions (i.e., Webcasters and satellite radio stations). Providers of music or other audio content over the Internet are grouped into two categories: interactive and non-interactive.

Interactive digital broadcasters allow listeners to control what they listen to and are required under the DMCA to negotiate directly with individual copyright holders or their performing rights societies for licenses to provide the copyrighted content to users. Non-interactive broadcasters operate like traditional radio stations and are permitted to operate provided they compensate copyright holders via a statutory license, with a fee periodically set by a Copyright Arbitration Royalty Panel.

Under the DMCA, Web radio broadcasters of digital transmissions are also required to pay royalties to record labels and recording artists. In contrast, traditional radio broadcasters only have to pay a royalty to composers, as radio broadcasts are considered to have substantial promotional value of benefit to the recording industry.
International laws

Kurbalija (2004) points out that currently, the only convention that deals directly with Internet-related issues is the Council of Europe Cyber crime Convention. However, many other international laws deal with the broader aspects of Internet governance. For example, in the field of telecommunications, ITU regulations (Radio Regulations and International Telecommunication Regulations) govern issues related to telecommunication infrastructure. Freedom of expression is protected by Article 19 of the Covenant on Political Rights. Global and regional human rights instruments regulate other Internet-related rights, such as privacy and the right to information. In the field of dispute resolution, one of the main instruments is the New York Convention on Arbitrations (1958).
Censorship on the internet

Governments try to control the Internet for a number of reasons. Sites usually banned include those with explicit sexual, racist, or terrorist content. Sites containing child pornography are universally accepted to be objectionable. Further, sites that are thought to belong to terrorist groups are usually banned by many governments.

Another factor for control over Internet access is to stop the spread of rebellious ideas and dissent. A rebel party situated in a authoritarian or bullying political medium may choose to prepare a Web site or a mailing list to broadcast its opinions instantly to thousands (even millions) of their national sympathizers or citizens of the world. Totalitarian governments that have little or no public support obviously wish to control the Internet just for this reason.

Economic considerations might play an important role in these efforts. Some governments do not want to share the profit that they owe to the monopolistic character of the Internet services they provide with other, independent operators and try to keep the Internet ‘under their thumb.’

Censorship in China

Ever since the introduction of the Internet in China in 1994 and particularly since its commercialization in 1995, the Chinese government has sought to control its content and to censor information it deemed detrimental or sensitive. (Amnesty International, 2006). China has over 111 million Internet users, using the most extensive, technologically sophisticated and

far-reaching system of internet. The outcomes of this censorship for China’s users are profound and disturbing. Despite China’s rapidly expanding economy the political climate still favours repression of dissent and restrictions over fundamental freedoms.

Amnesty International, (2006) has shown how the sophisticated technology that allows the government to block and filter Internet content is primarily designed by foreign companies. Words and phrases that have been targeted include ‘human rights’, ‘democracy’ and ‘freedom’. This pervasive system of filtering ‘undesirable’ information is so effective partly because the process lacks transparency.

There is no means by which Chinese citizens may appeal to have a site unblocked and it is not clear what words or phrases are banned and how the decision is made to prohibit certain topics. In September 2005, the government enacted the ‘Rules on the Administration of Internet News Information Services’, which required all individuals and organisations that publish news to be officially sanctioned. The only guidance offered by the government regarding the reasons behind this decision was that it was in the interests of ‘serving socialism’, ‘upholding the interest of the State’ and ‘correctly guiding public opinion
The internet was primarily designed for research and educational purposes. It encouraged cooperation and information sharing among academics in the United States and then all over the world. With huge investments in hardware and optical fiber giving rise to easy connectivity, the internet changed the world like few other inventions have. However, it was imperative that such a powerful tool be used for commercial purposes too, and indeed the increasing volume of e commerce is testimony to this role of the internet. In this context, intellectual property protection became critical as both producer and consumer interest needed to be looked after.
Innovations and innovative practices had to be protected against copying and consumers needed to be protected against spurious services and goods as also duplicates attempting to pass off their goods as someone else’s. Protecting brand value and equity required a strong trademark law. Today, Trademark law in most countries of the world protects domain names, digital content, search engines etc and regulates file sharing and web based advertising. In a digital world, such protection becomes imperative for the global economy to progress.
Reference List
Abel, S. (2004). eVolution or Revolution? Trademark Law on the Internet. At: Last accessed, April 18th, 2007
Amnesty International, (2006). “Undermining freedom of expression in China, The role of Yahoo!, Microsoft and Google”.
Barnhart, L. (2002). “Intellectual Property Rights: A Reference Paper for Protecting Language and Culture in the Digital Age”, Indigenous Language Institute.
Gartner Study (2003), “Copyright and Digital Media in a Post-Napster World”. GartnerG2 & The Berkman Center for Internet & Society at Harvard Law School.
Greenstein, S. (2001). ‘Commercialization of the Internet: The Interaction of Public Policy and Private Choices’. In (eds) Adam Jaffe, Josh Lerner and Scott Stern, Innovation, Policy and the Economy, MIT Press.
Halpern, W. S. (2005). A High Likelihood of Confusion: Wal-Mart, TrafFix, Moseley, and Dastar – The Supreme Court’s New Jurisprudence.
Hutter, M. (1998). “The Commercialization of the Internet – A Progress Report” At Last accessed, April 19th, 2007.
Jaiya, G. S. “Intellectual Property Management and Commercialization of New Products”. At Last accessed, April 19th, 2007.
Kurbalija, J. (2004) Internet Governance and International Law. At Last Accessed, April 20th, 2007.
LaMacchia, B, (2002), “Key Challenges in DRM: An Industry Perspective”, ACM Workshop on Digital Rights Management, Washington
O’Rourke, M. (1998). “Fencing Cyberspace: Drawing Borders in a Virtual World”, Minn. L. Rev. 609.
Isenberg, R. (2001). Trademarks and the Internet, 32 U. WEST. L.A. L. REV. 229, 234 (citing Polaroid Corp., 182 F. Supp. at n.19).
Shannon, R. “The History of the Net’, At, accessed April 19th, 2007
Von Lohmann, F. (2002) “Use and Digital Rights Management: Preliminary Thoughts on the Irreconcilable Tension between Them”. Electronic Frontier Foundation. San Francisco.

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