"The Desktop Global Marketer" (tm)

   A free on-line newsletter of Sidereal Designs, Inc.,
   for Internet Entrepreneurs, and those who are
   considering becoming one.
_____________________________________________________

                   July 21st, 1999

In this issue: "Domain Names: You thought it up, you
registered it, you paid your seventy bucks, and it's
yours, right? Well...maybe."

_____________________________________________________

   "The Desktop Global Marketer" is free, and may be 
   re-published freely with permission. We encourage 
   you to give it to your friends.

   For subscription (or un-subscription) details,
   and other information, please see the end of the 
   newsletter.

   For any other purpose, please write to:
   	jamie(at)siderealdesigns.com
   Or visit us at:
   	http://siderealdesigns.com
_____________________________________________________

For a long time the Internet was like the American Old West:
"No law west of the Pecos." Anyone could - and did - do just
about what they pleased. This worked amazingly well because
in the early days of the Internet the only people out there
were pretty decent, idealistic folk who were intent on
building the tool that was going to remake the
world. Commercial traffic of any sort was forbidden by
custom, and fast, frontier justice greeted the few who
transgressed it.

How times have changed! The success of the web has made it
self-evident to all that it will be the single greatest
engine of commerce of the next century. Quite a lot of
businesses - for example brokerages - will shortly disappear
altogether in their non-web forms. Nobody knows how it will
all sort itself out, or who the winners or losers will be,
but the gold rush is on. All the would-be entrepreneurs in
the land are rushing to stake their claims, and just about
every sharp operator and outright highwayman in town smells
the loot.

The law is totally unprepared. It proceeds by legislation
and by precedent. The legislators have no comprehension of
the technology. There is no history of relevant precedent,
and the technology changes faster than new precedent can be
generated.  Courts are struggling to work by analogy, and
the only analogies are often far-fetched and useless. In
many cases it's even difficult to decide where a crime
should be considered to have been comitted, and hence who's
laws apply.

Things like credit-card fraud and embezzlement are pretty
straight-forward, but the issues of copyright and trademark
and theft of intellectual property are much more difficult,
as I will demonstrate shortly. For example, it was once
obvious what constituted a copy; now it is not. The courts
have been wrestling with ways to say that someone who copies
your software off your website and saves it in his machine
has stolen something from you without making it illegal for
someone looking at your website to have the necessary copy
of it in his computer's memory chips.

Watermarking: It's easy to modify digital things. If you pay
to have a fancy image created for your website and I copy it
and suck it into my image-editor and use it as the basis for
my own image have I stolen your property? Can you prove it?
Technology is starting to be of some help here as well as a
source of confusion. It's now possible to digitally
"watermark" an image with a visually undetectable signature
that will survive editing and can later be retrieved and
examined by special programs. If you pay a lot to have your
web designer or graphic artist produce digital images for
you, ask to have them digitally watermarked. Else you might
lose all right to them. Also get them to guarantee you wont
be sued by someone who finds their watermark in "your"
image!

Taxation: This is a howling wilderness of legal adventurism.
The states and counties are all trying to get the laws
against taxation of out of state purchases repealed because
most commerce will be out of state shortly and they're going
to lose billions in taxes. What constitutes "presence" in a
state for tax purposes? Do you know where the machine is
that houses your web site? Are you therefore doing business
in that state wherever it is? The best guide to internet tax
issues is David Hardesty. Visit his site at
http://www.mshb.com/EC/index.htm and if you want to stay
abreast of e-commerce taxation issues, subscribe to his
newsletter. (This link is always on Sidereal's "Useful Stuff"
page. http://siderealdesigns.com)

Domain Names: You thought it up, you registered it, you paid
your seventy bucks, and it's yours, right? Well...maybe. It
had first been thought legally that you owned only a license
to use the name for two years, and that property rights (if
any) vested in the registrar, such as Internic. In March of
this year a federal court in Virginia ruled that domain
names are ordinary property and thus subject to different
rules than had been previously thought. In this instance a
domain name was considered to be part of a firm's tangible
assets and ordered sold along with their desks and filing
cabinets to satisfy a judgement. The litigants got an order
to garnish the domain from Internic. This raises the
possibility that if the registrar takes the name away from
you without a legal basis you could sue them for civil
damages. Of course, that's a two-edged sword...

Trademarks: It's certainly a good idea to make sure you
don't infringe anyone's trademarks when you create a web
presence. A good start is the on-line trademark search of
the U.S. Patent and Trademark Office at
http://trademarks.uspto.gov/ (also a link always on
Sidereal's Useful Stuff page.) However this by no means gets
you out of the woods, because a trademark can be very
legitimate without being formally registered with the
USPTO. For real protection you need a legal specialist who
is knowledgeable in conducting trademark searches, but this
is not cheap. Lawyers we know advise everyone to plaster
those little "TM" symbols all over their sites. It's
probably sound legal advice, if a bit ugly, but it too is no
guarantee of protection.  Registering is better, but can
still be legally overturned.

What about registering a domain name? Does that give you
trademark protection of the domain? It probably helps you
establish first use, but legal pitfalls are appearing. In
April of this year the Ninth U.S. Circuit Court of Appeals
in San Francisco ruled that registration of a domain name in
and of itself does not constitute "use" for purposes of
acquiring trademark priority. The court went on to say that
priority was established by first active use of a name in
commerce. This means that simply registering a name but not
actively using it in commerce, or "parking" it on another
domain, does not establish prior use. Someone who has used
the name, on or off the net ,in active commerce can take it
from you.

SPAM and Privacy: These are both big issues on the web and
we've covered them separately in previous issues. If you're
a new subscriber considering a web site - especially one
with a mailing list - you may want to check these out in
Sidereal's newsletter archive.

Lynch Law: There's still a bit of the Old West left in the
net, and you can still get pretty badly shot up for
violating the accepted, if extra-legal, norms. Mail bombs
and URL storms are pretty effective medicine and there are
worse things around. You probably wont get any sympathy from
the sheriff, either. Smile when you say that, Pardner!

Disclaimer: Nothing in this document is intended to
constitute professional legal advice. Neither the author nor
Sidereal Designs, Inc. takes any responsibility for the
legal correctness of any statements made here. Neither the
author nor Sidereal Designs, Inc. will be liable for any
damages, consequential or otherwise, resulting from reliance
on any statement made here. No representation is made that
any statement made here is accurate or reliable. :)

Best,

Jamie


_____________________________________________________

To subscribe, send email to: 
	newsletter-request(at)siderealdesigns.com
and include the word   subscribe   as the only item in
the body of the letter.

To unsubscribe, send email to: 
	newsletter-request(at)siderealdesigns.com
and include the word   unsubscribe   as the only item in
the body of the letter.

If you have problems with either of these, write directly
to jamie(at)siderealdesigns.com for prompt attention from
a human.

If you would like to re-publish any of our newsletters,
at no cost, please contact jamie(at)siderealdesigns.com.

"Sidereal" is pronounced sy-DEER-ee-all, and means "of
or pertaining to the stars, the heavens, etc."
______________________________________________________________________________
Sidereal Designs, Inc. "Making The Web Simple."   http://siderealdesigns.com