Eric Goldman is an Associate Professor of Law at Santa Clara University School of Law. He also directs the school's High Tech Law Institute. Before joining the SCU faculty in 2006, he was an Assistant Professor at Marquette University Law School, General Counsel of Epinions.com, and an Internet transactional attorney at Cooley Godward LLP. Eric teaches Cyberlaw and Intellectual Property and previously has taught courses in Copyrights, Contracts, Software Licensing and Professional Responsibility. Eric's research focuses on Internet law, intellectual property, marketing, and the legal and social implications of new communication technologies. Recent papers have addressed topics such as search engines and online marketing practices.
ANNOUNCER: Today’s program is brought to you by Traverse Legal. A law firm specializing in internet law, domain disputes, and technology company representation. That’s Traverse Legal www.traverselegal.com. Welcome to the Vertio Talk Radio tech spotlight with your host Damien Allen.
DAMIEN ALLEN: Good afternoon and welcome to Traverse Legal Radio. I’m Damien Allen in the studio with Professor Eric Goldman of the Santa Claire University School of Law and the Director of the High-tech Law Institute at Santa Claire University. Good afternoon and welcome to the program Eric.
PROF. ERIC GOLDMAN: Hi. How are you?
DAMIEN: I have very few complaints, enjoying a great day here in lovely Northern Michigan. And today we will be speaking about domain name exceptionalism and exactly, Eric, what is domain name exceptionalism?
PROF. GOLDMAN: We have to make sure we get that pronounced right. Domain name exceptionalism is when, from a regulatory standpoint, we treat domain names as different from other types of online communication tools. So, for example, we might regulate domain names differently than we do other types of keywords, such as keywords used to trigger advertising. And we have a long list of laws that have treated domain names special as ways of people to communicate in. I hope we can enforce some of them.
DAMIEN: Now, why would a domain name be so heavily regulated? Where a keyword or search words aren’t?
PROF. GOLDMAN: Well, that’s a good question. It’s something that I’ve been wondering all along and we see over and over again regulators and perhaps people in the marketplace assign special magical powers to domain names. That they somehow have some unique or different impact on causing consumers to go one place as opposed to another. It’s something I see in the field, but regulators assign that heightened special role to domain names. Some of that might be due to the historical power of domain names, back when there weren’t a lot of other keyword options, back before there was a robust search engine for example. And so, back then perhaps having the domain name was more important way of staking up some turf in the marketplace. But times have changed I’m not sure regulators have.
DAMIEN: Now, this has been a constant discussion term with a lot of these interviews where you talk about domainers. People who park on sites. People who want to buy all these domains, hold them hostage, sell them back. People who have stolen domain names and the term of branding your domain name could be everything to you. But, at the same time, so could your keywords. What are some of the regulations that are specific to domain name and what are some of the regulations to keyword specific?
PROF. GOLDMAN: With respect to domain names an example of domain name specific regulations the Anti-Cyber Squat and Consumer Protection Act, which was passed about a decade ago by Congress to clean up some of the 1990’s era cyber squatting and it creates a series of rules about the proper acquisition and usage of domain names. We don’t have anything equivalent to that with respect to keywords. In fact, keywords are fairly lightly regulated. We’re still developing legal regulations for keywords in the courts, but statutorily Congress has pretty much ignored search keywords. So, that about it. But, we actually have a long list of other examples of domain name specific laws. Let me just mention a couple. First, we have some state domain name laws. Where states have said domain names are so important that we are going to get into the business of regulating them. Even though usually domain names are going to be global in nature. So it’s not really clear what states can do to add something to the party. Another example of a law is the Truth in Domain Names Act; which is a law that says you can’t use domain names to lure kids into porn. And again we come back to the issue of if the domain name is really unique, special, or different from other ways that people could misdirect kids or anyone else into porn.
DAMIEN: So, thereby policing for the benefit of the youth, which would be a good law, whereas there has been other cases say boycottkentucky.com has a campaign going against Governor Steve Beshear who sees a hundred plus different domains dealing with gambling saying it threatened the income of the state of Kentucky.
PROF. GOLDMAN: Yeah and that’s another issue that has been interesting and a little hard to wrestle with. So, one the one hand the gambling sites in theory could be agnostic about the domain name that they use. So if the state of Kentucky decides that it wants to go and clean up online gambling. It’s going to go grab some domain names from gamblers, in theory, it shouldn’t matter. The gamblers say fine, here you go, here’s a bunch of domain names we’re going to go to some other domain names. Show me how you’ve made any progress there. Other words the domain name is only one asset, and perhaps not even a critical asset for online gambling websites to be able to reach their consumers. On the other hand it raises some really thorny issues about states trying to impose their will on this global domain name scheme. In other words, what basis does Kentucky or any other state have the right to claim that they can grab an asset for some domain not to have any other ties to Kentucky and remove it from the gambling site.
DAMIEN: Now with domain name regulations, keyword specific regulations, stuff like that, with the search engines coming in what are some of the policies that are being used with the search engines? If say, I register a keyword or I purchase a keyword or search term is somebody else able to block that kind of thing? Or do I own it?
PROF. GOLDMAN: We’ve seen a lot of self regulation among the search engines. Search engines have developed a variety of policies to try to accommodate the interests of trademark owners and give them some power to shape how their trademarks can be used as keyword triggers for advertising. We’ve seen a variety of policies. Google has perhaps a nonstandard one compared to its competitors where it will not allow the blockage of a keyword specifically it will only allow the trigger guard to block the reference to the trademark in the ad copy. Other search engines will the blockage of the keyword as that trigger entirely, but then with a bunch of caveats and exceptions and so on. And then there is yet other programs, for example, the Ad Sense for Domain program where Google has taken a slightly different tact with respect to how it allows trademark owners to block their trademark being used for park domains. So we’re seeing a whole bunch of self regulatory efforts. None of these are expressly driven by Congress or by other regulators. In some sense some of the self regulation might be to avoid trademark claims that might otherwise come. So they’re basically forestalling more litigation in the courts. But, for the most part Congress and the Legislators have left this to the search engines to figure out for themselves. So it’s very unusual that we see domain names being much more tightly regulated, keywords being left largely to the market, and then raising the question which one is really the right result.
DAMIEN: And how deep is the Federal Government really getting into this regulation? Is it so broad spectrum that they’re hoping to come up with a set of rules for the entire gamut of the web? Or are they looking for just specific things?
PROF. GOLDMAN: As I said, Congress has pretty much ignored it. We have seen two states that have been active in regulating keywords at the state level and the most active one has been Utah, which has tried already, depending on how they want to count it, two or three times to restrict certain kinds of keyword advertising. And the prediction that I have is that they’re going to try again. It seems almost inevitable that they’re going to think that they can solve the problem. So, in the case of Utah they’re actually prepared to get pretty deeply involved in the regulation of keyword advertising, but we’ll see if they can actually figure out a model that makes sense.
DAMIEN: And is this going outside the realm of we’re trying to protect our children from pornography? Is this actually stating a case that these keywords threaten the income and livelihood of the state of Utah?
PROF. GOLDMAN: It would be out of bounds for me to suggest I could speak for anyone in Utah. I truly do not understand what they’re thinking. Having said that I don’t believe this is anti-porn effort although they have plenty of laws that they’ve pursued to try and clean up internet porn themselves. But this has in the past been really much more about the latter point that you make with respect to actually trying to protect Utah businesses from losing money to competitors that are buying up keywords triggered on their trademarks.
DAMIEN: So with all this debate and everything that’s been discussed about it, what is so important about domain names? What’s so powerful about them? What makes people so passionate about this that we’re now looking at state regulations, people up in arms, lawsuits? What’s the big deal all about Eric?
PROF. GOLDMAN: Well I’m still trying to figure that out, but there’s been no doubt that an entire economy has developed around domain names and we continue to see domain names litigation. We continue to see domain name speculation. We continue to see what, I think, look like inflated prices for domain names; where people are spending in some cases millions of dollars to acquire a single domain name. And with that kind of money being thrown around then it strikes that there may very well be people who are so concerned in protecting their investment that want additional protection from the legislators and regulators to keep them safe or to protect their investments. The question that I still have and that one of the areas where there could be a wild swing to domain name evaluations is how much credit search engines are giving to keywords that are in the domain names when they do their sorting algorithms. If search engines continue to give extra credit to keywords in domain names then domain names do have some additional drawing power to, say, other types of keywords based on the ability to get inorganic traffic. If the search engines start to change that policy, for example, say no we don’t want to give a lot of credit to domain names now that they’re easily gamed, then they will simply revalue them in their sorting algorithms and it could be that all these domain names will lose inorganic traffic that they’re getting or get a substantionally lower amount, because that’s what the search engines decide. What is also completely unclear to me is how much value there remains in what we refer to as type-in traffic? Certainly, there are some domain names that have some power for that, but it strikes me that over time consumers have increasingly gone away from relying on typing in domain names into browsers for a couple of reasons. One, unless they’re good typers they might not get where they want and it’s a whole lot easier to simply go to the search engine and put in the exact same search terms into the search bar as opposed to the address bar. The other is of course that there could be pernicious consequences with going to the wrong domain name that they could end up getting pop-ups and porn which they simply don’t want. So, in my mind the question remains to what extent domain names will have a value over time? What extent consumers are being socialized away from domain names? To what extent domain names are dependant upon search engines and their sorting algorithms? It strikes me that we might see some of the investment expectations change simply because of these external changes not because of any regulatory changes. There’s not a whole lot that regulators can do to prop up the domain name system that way.
DAMIEN: Does there look like there may be answers to any of the questions anytime in the near future?
PROF. GOLDMAN: Well I’m not even sure which questions we consider open. In other words, entrepreneurs are making investment decisions today, consumers are searching today, and in many respects the system is working generally pretty well. There’s a lot of happy people out there, but there’s always some unhappy people maybe they’re the ones with the questions. In terms of a regulatory outcome I don’t anticipate any changes soon at the Federal level it’s something I think Congressional Regulators have bigger fish to fry right now. At the state level there may be new answers, but they may not be all that well thought through. So, for example, if Utah decides again to regulate keyword advertising we’ll have an answer. My guess is it won’t be the best one.
DAMIEN: Is the states getting into this something that we may see an upswing of or is this just an isolated case?
PROF. GOLDMAN: Utah is special. I can’t speak whether other states will decide to get involved. It’s very possible that Utah marches to its own drummer and nobody else will follow. But, state legislators are a little bit easier for business interest to capture. So, it is possible for trademark owners to rally together and to go persuade a state legislator to do something goofy, though it would be much harder to do at the Federal level. Although, my question is whether or not there’s state legislators who are receptive to that kind of lobbying or push. What’s interesting is the Trademark Owner Associations have generally not been pushing for legislative solutions, but we really haven’t seen a lot of noise from groups like INTA or the ABAIP section, or AIPLA, or et cetera, et cetera. People who tend to coordinate the actions of the trademark owners in trying to rally up the troops to go and push for state legislative solutions and as I’ve said I think there’s enough stasis in Congress that nobodies really looking to push the battle there. So, it’s very possible that we won’t see a kind of new regulatory efforts by states, either because no ones pushing it or for it because it’s just too complicated for people to really get their arms around.
DAMIEN: A lot of different aspects of this. We thank you very much Eric for joining us today and discussing this with us.
PROF. GOLDMAN: You’re welcome. It’s a pleasure.
DAMIEN: We’ve been speaking with Prof. Goldman of Santa Claire University School of Law the Director of the High-tech Law Institute at the Santa Claire University School of Law. You have been listening to the Traverse Legal Radio program. I am Damian Allen. Everyone have a great afternoon.
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