Trying to avoid a legal headache that has afflicted others in the Internet address space, a start-up hoping to change the way users pull up Web sites has asked a group of Net luminaries to help it head off potential liability created when multiple companies claim exclusive rights to a name.
Centraal, maker of the RealNames Web directory, named former commissioner of the Federal Trade
Commission Christine Varney; Lori Fena, chair of the Electronic Frontier Foundation and chair of
the privacy certification group Truste; and Andrew Bridges, Centraal's
Internet and intellectual property lawyer at Wilson Sonsini Goodrich & Rosati to a
policy advisory board.
Centraal's RealNames directory allows users to pinpoint specific pages on a company's Web site that correspond to particular goods or services. A user looking for information about Pepsi One, a new soft drink, can find a link to the specific page that advertises it on Pepsi Cola's Web site.
Companies pay Centraal $100 per year for a single listing. Companies with multiple listings pay a recurring fee based on the amount of traffic Centraal brings to their site.
The board's formation appears aimed at insulating Central from liability
other third parties have faced when two or more companies face off over an
Internet address. The relationship of trademark law to Internet addresses has dogged Internet policy makers for years.
The board's formation comes as the nonprofit organization assuming control of many of the Internet's crucial functions--the Internet Corporation for Assigned Names and Numbers (ICANN)--is forging its own policy for resolving trademark disputes on the Internet.
The board will help Centraal forge "fair and equitable" rules for deciding which customers should receive a given listing. While it may be relatively simple for Centraal to decide who is legally entitled to a strong trademark, such as "Disney," awarding a name such as "America's favorite entertainment provider" could be fraught with legal liability if two or more companies square off in court over the phrase.
Network Solutions, which until recently was the sole registrar of the most popular forms of Internet addresses, used to face similar exposure. Early on, companies that believed a domain name was improperly registered to someone else frequently brought NSI into the fray, claiming that the act of registering the name contributed to trademark infringement.
A series of court decisions has since let NSI off the hook, finding that NSI's actions as a registrar lack the commercial elements necessary to bring a trademark suit.
Centraal, however, is not likely to benefit from that line of court rulings, said Sally Abel, a trademark attorney at Fenwick & West.
"This is a private entity putting up a directory service. I don't see Centraal as having some of the arm's-length arguments that NSI had," said Abel, a member of the now-dissolved Internet International Ad Hoc Committee, which submitted a plan to try to resolve the trademark controversies. The plan was later killed by critics, including the U.S. government.
"They obviously want to avoid litigation as much as possible," Abel added.
Centraal spokeswoman Donna Loughlin said the company has yet to face a lawsuit over a disputed name but agreed that the company is interested in preventing legal challenges over its policies. She added that Centraal also hopes the board will lead to an "external agency" that will help resolve trademark disputes among Internet players.
"The ultimate goal is to use this as leverage for us to get involved in...an external organization that would go well beyond Centraal," Loughlin said. She added that Centraal has not yet decided what that body should be, but it was possible it could be formed in conjunction with the ICANN.
Internet users have been complaining for years that the system for finding products and services on the Net is far from perfect. RealNames' method of directing users to sites based on product names rather than sometimes complicated addressing schemes has attracted the attention of a number of big-name investors, including NSI, Idealab, and Draper Fisher Jurvetson.
Loughlin said Centraal has lined up other board members as well but declined to name them. The board will advise Centraal on how to form a fair dispute policy and will lobby policy makers as well.