Our next speaker is Ms. Sarah Deutsch, and she is the vice president, associate general counsel at Verizon communications.
Sarah, I hand you the mike.
>>SARAH DEUTSCHE: Thank you. Is my screen showing?
>>JOTHAN FRAKES: Rob hall, thank you for your help there.
>>ROB HALL: Don't thank me yet.
>>JOTHAN FRAKES: There you are.
>>ROB HALL: It's there. Can you see it.
>>SARAH DEUTSCHE: Yes. Although there is nothing long with a little healthy monetization, I am going to talk today sharing I think Roberto's and other's concerns about the dark side of monetization. And this unfortunately has nothing to do with lip balm or photography, but does have to do with the exploitation of trademark that victimizes consumers and businesses and the goodwill of the trademarks. And most of the problems are actually arising from the practices of domain name parking.
And let me say. Yes, here see for example our customer wanted to go to our Vcast service which is one of our wireless services but has found out all it needs to know about go daddy's services. And also from issues involving typo-squatting and domain name tasting.
So the practices are bad enough in their generic form but I am going to focus today on what I find very troubling and that is that some in the registrar community for various reasons are registering or taking ownership of typo-squatted variations of trademarks in their own names.
So many of you may be aware that various entities in the monetization food chain have already been sued. So this past March, Louis Vitton sued Overseed.net as marketers of landing pages or other revenue generation services for trademark infringement and cybersquatting, and Neiman Marcus and Bergdorf Goodman recently sued the register Dotster. According to the complaint, Dotster registered numerous variations of the plaintiff's marks in its own name and then listed no match in the WHOIS database for each of these infringing domain names. And unfortunately for us, one of the exhibits to that complaint showed that Dotster had actively exploited many famous brands including over 120 variations of our Verizon trademark as domain names. And we have written to Dotster and have only just heard that we will be able to get all of those domain names back.
This April, we also learned that eNOM had 144 variations of our Verizon trademark and our superpages trademark, which is the name of our online directory.
And eNOM cause called their domain name tasting service club drop. So we wrote to them about two in particular because we were in the process of selling our superpages business and we needed those domain names to provide back to the purchaser of that business.
So they wrote back to us and told us that apparently their customers had defaulted on the payment and registration fees and therefore, they had placed the names in eNOM's name.
So you can see here that we did a WHOIS search for one of the other infringing names, a typo-squatted variation of freeverizon.com, who it shows eNOM is the registrar, and then lists the registrant's name, their first name as master and their last name as account.
So it's difficult to determine if the owner here is eNOM or if it's some evil villain's nickname, you know, master cylinder, master account.
When we first complained to eNOM, they told us we had two choices. One is we could purchase our names for $160 plus a $29.95 registration fee or they would let the names be deleted. And deleted means it would be dropped back into the pool and auctioned off to the highest bidder.
And you can see here that they have a very active practice of optioning Verizon trademarks.
We then wrote back again informing them that their activity, under the clubdrop program, was a violation of our rights, and this has been since April, and we wrote back again in June after the Dotster case was filed.
So I heard on Friday that we would be able to get two of those names back, and I had a very good discussion here today with Paul Stahura, and I am very confident we will be able to figure this out and work this out to get, we know at least three other names of our trademarks that are in eNOM's name and we are not sure who owns the various others.
So I have spent most of my career at Verizon dealing with liability issues.
And although until now, I think the registrars have done an excellent job protecting themselves from liability, as you have heard today there are so many entities in this food chain who are getting a cut from some of these new monetization schemes. And I think this places everyone in that food chain at an increased risk of liability.
So registrars in the U.S., and I can only speak to U.S. law, I believe would face liability under, for traditional trademark infringement as well as the anti-cyber squatting act for their bad faith intent to profit as, quote, one who registers, traffics in or uses a confusingly similar variation of a mark. And you can see here the various elements that can be triggered to show bad faith.
The cyber squatting act also requires that the registrar must have a reasonable policy prohibiting the registration of identical or confusingly similar marks. It's hard to see how a practice of domain name tasting, parking, typo-squatting would be consistent with a requirement to have a reasonable policy. Moreover, this same law says that the registrar is not liable for damages only absent a showing of bad faith intent to profit from such registration or maintenance of the domain name.
In eNOM's case we heard they believed from their counsel they were immune under the Ford versus Great Domains case. However, the court in that case held that Great Domains was only as auctioneer who does not transfer or receive for consideration the domain names names that are sold over its Web site.
>>PAUL STAHURA: I would like to respond to that.
>>JOTHAN FRAKES: That's very reasonable, but can you hold that until Sarah has completed, and then you can respond.
>>SARAH DEUTSCHE: There will be plenty of time for fighting here this morning.
>>PAUL STAHURA: The facts are not correct, and it's not -- you know, fair.
>>SARAH DEUTSCHE: I think we should in courtesy let each continue because we can each interrupt each other with facts that are not correct.
>>JOTHAN FRAKES:That's indeed the case but Sarah, you are running up against your time limit. Do you have many more slides?
>>SARAH DEUTSCHE: No. One more slide.
So two last points. One is that I think the concept -- there's a risk here that the concept of secondary liability under trademark law might be expanded either in the case law or possibly in legislation akin to what we saw in the Grokster case, and I don't necessarily think that's great for many -- all across the spectrum to see increased secondary liability for trademarks.
Finally, I would note that ICANN has an important role to play in addressing this issue. Section 3.7.9 of the registrar accreditation agreement states that the registrar shall abide by any ICANN adopted specifications or policies prohibiting or restricting warehousing of or speculation of domain names by registrars. And although some in the domain name community it appears would love to do away with this section in the next iteration of the RAA, I would at a minimum urge that ICANN put this section in here for a reason, and anticipating the possibility of misconduct and the need to act on it.
So I think at a minimum we need a PDP to study these issues and suggest specific policies prohibiting registrars from promoting and participating in the speculation of typo-squatted trademarks in the secondary market.
>>JOTHAN FRAKES: Okay. Thank you, Sarah.
Now I personally heard a few blurring of distinctions and I think because Paul Stahura was singled out here, would I like to give him the opportunity to re-address before we continue into the next segment.
Paul, go ahead.
>>PAUL STAHURA: Two quick comments. You mentioned two types of names, your letter does, and by the way, I was only made aware of this yesterday, so I didn't enough time to research this controversy. But your letter to us mentions two types of names. The first two names we think were not paid for by the registrants. So some registrars -- every registrar has these names. Some registrars call it seized names or lost and found or whatever. But for various contractual provisions, we end up with names. Like it was used in child pornography or whatever, so we seize it. So what do we do with these names? If they are trademarks, if we approach the trademark holder, then they think we are holding their feet to the fire. If we delete them they may end up in some other registrar which makes it very difficult for the trademark holder to get these seized names. So what we do is we hold onto them and when a trademark holder approaches us and wants the name, we say okay, pay us retail. I think one of these names was in RGP. So therefore, we said pay us retail plus pay us our RGP fee which is 160 bucks.
So I think the way we settled those two is we just gave them to you and so eNOM is out some money.
Now, the second class of names in your letter was 145 names that your, I feel, overzealous attorney says that we were auctioning. Now, we looked at our database yesterday and found -- I was confused by this statement of your attorneys. So we looked in our database and we found that -- we looked at -- he said it was on June 6th. So we looked at days before June 6th and days after June 6th of what names were in auction and we couldn't find -- we found one name that was in auction. And by the way, when we say auction, that doesn't mean eNOM owns it. It means we have demand from registrants who want to register this name, more than one. The name is about to drop, so we don't know which registrant to give it to, and so we get it for one of the two registrants and then we auction it similar to other systems like Snapnames and Pool.
We couldn't find these names in any auction, but what we think your attorney did is look at the list of names that is about to be deleted, which is a list, and I think we'll have another speaker talk about the states that the name goes through and time but it's a list that VeriSign publishes every day that says these, whatever, 20,000 names are going to be deleted in five days hence. So I think your attorney looked at that list that we republish and found these names, these 145 names that you say you have a trademark or a typo related to your trademark on.
When we looked at the list we could only find 102 that were related to Verizon or superpages.
So further investigation, those names -- none of those names were registered at that time. After republished the list, our clients, which we don't know if it's Verizon or could be VeriSign looking for a misspelling of their name. One client of eNOM said they wanted one of those names on the list so we registered it for them.
So out of the 145, one name was registered, and not by eNOM.
>>JOTHAN FRAKES: You know, I understand you would like to re-address. This may have to do with litigious matters. It also is diverting us from our aim which is to talk about the marketplace.
>>PAUL STAHURA: I do agree with her last statement. I wanted to say I think we could settle this misunderstanding, in my opinion.
>>JOTHAN FRAKES: And it is very easy to make a misunderstanding. Obviously, these are sophisticated issues, which part of the participation in this is to create a common dialogue so people can understand all the various complex issues.
Sarah, I saw you had a point and then I would like us to move on to an opportunity for the public, after we get an opportunity to pose questions to each other.
Go ahead, Sarah.
>>SARAH DEUTSCHE: Okay. Thanks, just a quick point, I guess. We did this research in April. So 145 names were showed as being auctioned off then.
>>PAUL STAHURA: That's not what your letter says. Your letter says June 6th.
>>SARAH DEUTSCHE: In any event, this has been going on for months. Apparently if someone has stopped payment on their credit card, I don't think that this is necessarily charitable service that the registrar is doing by taking it in their own name. What they are saying is someone hasn't paid us, and someone has to pay, and it might as well be you, the trademark owner.
I think Paul here is acting in good faith and I am confident we will work it out.
