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House passes cybersquatting bill

Fines could reach $100K. Bill bans 'confusingly similar' names. White House, privacy groups warn it goes too far.
Written by John Simons, Contributor
WASHINGTON -- The House passed a bill outlawing "cybersquatting," or registering an Internet address that is a trademark or corporate "service mark" with the intent of selling it to the highest bidder.

The measure, introduced by Jim Rogan (R., Calif.) and Rick Boucher (D., Va.) would prohibit the registration, sale or use of a domain name that is identical to or "confusingly similar" to a trademark in use at the time of the registration. Violations would be punishable by fines of as much as $100,000. If a site is registered before the law goes into effect, the trademark holder can demand the cancellation or return of a domain name that uses its trademark or famous name.

The Senate approved a similar bill in August. Now, lawmakers must go into a conference session to hammer out the differences between the two measures.

The legislation is supposed to clarify the rights of trademark holders, but instead, it raises a number of questions and will likely spark a heated debate as it heads toward President Clinton's desk.

Companies argue that such Internet domains dilute their trademarks. While some companies pay large sums to buy Internet addresses that use their trademarked names, many have sued to stop the use of the domain names. But the courts haven't always been sympathetic. Last month, Hasbro Inc. lost a case against a Boulder, Colo., company called Clue Computing over the rights to "clue.com," which carries the same name as Hasbro's famous Clue mystery board game.

Too far reaching?
The White House, free-speech advocates and many industry groups are concerned the legislation's proposed remedies are too far-reaching. Web sites such as Ihatemicrosoft.com, which contain commentary and parody, might be deemed illegal under the measures.

The legislation "is really tipped in favor of the trademark interests," said Dori Kornfeld, a policy analyst with the Association for Computing Machinery, a New York nonprofit organization of computing professionals.

The Clinton administration, in a letter to Rep. Rogan in August, expressed concern about the bill, arguing that existing laws sufficiently protect famous names and trademarks.

The legislation also sets up a regime in which foreign domain holders can be sued in U.S. courts if they registered a domain in the U.S. Critics say that provision could be difficult to enforce.


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