Ex Parte Filing of Kathryn Kleiman, General Council, DNRC

June 2, 1998

Summary of Ex Parte Meeting of the Domain Name Rights Coalition, Professor Milton Mueller and Professor Tamar Frankel with Becky Burr and Karen Rose of NTIA

Submitted by Kathryn Kleiman, Esq.

Kathryn@domain-name.org

On Tuesday, May 26, Kathryn Kleiman, General Counsel of the Domain Name Rights Coalition (DNRC) spoke with Becky Burr to arrange a meeting.

On Thursday, May 28, Ms. Kleiman and Harold Feld, Assistant General Counsel and Secretary of DNRC, met with Becky Burr and Karen Rose at the Department of Commerce in the office of Ms. Burr.

In the first part of the meeting, Professor Milton Mueller, Director of the Graduate Program in Telecommunications and Network Management at Syracuse University’s School of Information Studies, joined the group by phone.

In the second part of the meeting, Professor Tamar Frankel, Professor at Boston University School of Law, teacher of corporations law for 20 years, writer of the definitive treatise on the regulation of money markets and expert on fiduciary law, joined the group by phone.

The meeting covered three topics:

Concern that the study proposed by the Green Paper about the effects of adding new TLDs and creating dispute resolution procedures for domain name conflicts must be performed by a body that is both independent and objective. While WIPO and the American Arbitration Association (AAA) and similar international organizations should certainly be offering competing mediation and arbitration services for online disputes, including domain names, DNRC and Professor Mueller suggested that an objective party such as an academic institution would be an appropriate site for this important study.

Concern that the trademark infringement case has been overstated. DNRC restated its position of the Green Paper Comments of March 1998 and Department of Commerce Notice of Inquiry Comments of August 1997 that trademark owners are seeking to expand their rights and enforcement powers on the Internet beyond their traditional rights and enforcement powers. DNRC expressed concern that such a position, if incorporated into public policy, would result in harm to small businesses, entrepreneurs and individuals.

Professor Mueller discussed his recent study of conflicts between domain name registrants and trademark owners. His study examined four categories of conflict: infringement; string conflict (where Prince Sports and Prince Lighting want prince.com); speculation (where a party registers a mark for the purpose of offering it to another party); and parody and preemption (where the domain name is used for a commentary about another group or reserved so that it cannot be used by another group). He found that only 12 percent of trademark and domain name conflicts involved actual infringement. In these cases, existing legal remedies proved very adequate and provided a nearly 100 percent effective remedy for trademark owners. The study also found that 88% of trademark and domain name conflicts did not involve infringement at all. From this study, Professor Mueller concluded that it would be a mistake to allow concerns about trademark infringement to shape the regulatory agenda for Internet governance.

DNRC supported the Green Paper’s search for a corporate structure that would provide accountability, responsiveness and transparency. However, it questioned whether the not-for-profit corporation would meet these criteria. Professor Tamar Frankel, whose work on fiduciary law has been quoted by the highest courts of several countries, pointed out the high goals of the new corporation would be better met by another type of structure such as a for-profit corporation or a trust. A for-profit corporation would have to meet the mandated disclosure requirements of the SEC and a business trust would be required to administer the Internet assets for the benefit of those who use the Internet. Professor Frankel pointed out that the trust, in particular, combines great flexibility with accountability.

DNRC thanked Ms. Burr and Ms. Rose for their time and all of their work and effort on these matters.