Last month, Utah passed its own statewide anti-cybersquatting law.
This has happened in the wake of recent initiatives in the internet world where entities are trying to set jurisdiction forescalation and enforcement. Recently, California has been in the forefront on that issue thanks to Verisign and its long history in that state.
However, and moving East a bit, Utah is taking some of that limelight.
The new Utah law provides for the following: First, It is purported to increase the benchmarks of financial damages for which a cybersquatter can be sued.
Financial deterrents seem to be a good route to pursue, except for when you consider the case of the young Australian man who uploaded a Nintendo game title pre-release date and was convicted under similar intellectual property laws, which levied a hefty fine that he will be paying for the rest of his life.
At his current level of employment and yearly earnings, he will never pay his debt over his lifetime.
A victory, yes, but I don’t know if Nintendo is so sure after their own legal expenses. That is not to say that the punishment is not effective, but a fine to those who are broke is not much of a deterrent.
Having said that, the Utah law seems to address that and more.
The new Utah legislation further extends penalties to allow trademark owners to sue “affiliates” that enable cybersquatters to operate.
This may be a change that could have some teeth if it catches on.
Personally, I have a love / hate relationship with this because in many cases, in my experience, the affiliates are operating somewhat ignorantly in their infringement. Something like this would be devastating especially for an “advocate” of the product who unknowingly violated a process point.
However for the ones who have their eyes wide open, this will make them rethink their formerly “easy” money.
The legislation then provides a solution for those affected by phishing and pharming attacks. This is accomplished by permitting registrars and Internet service providers to remove or disable Web site content deemed to be involved in fraudulent activities.
I am not sure this does much more than enable effective Cease and Desist campaigns to have some early recourse in a handfulof cases.
I say this because in my experience, compliant registrars and ISPs usually do this already; to me this would just state for the record that you had one more entity backing your assertions.
Here is where Utah’s legislation sharpens its teeth:
The law defines phishing and pharming as third-degree felonies.
That’s right, they are felonies in Utah, tried right next to similar third degree felonies like DUI and Sex offenses. The law allows further for either actual damages or rewards of up to $150,000 per violation in related civil suits.
Pursuant to this Utah is also permitting $1 million in penalties for the use of spyware.
Utah hopes this will serve as a model for legislative action in other state legislatures and ultimately in the United States Congress. They are not alone in their enthusiastic support for this legislation; CADNA or The Coalition Against Domain Name Abuse, has given the Utah E-Commerce Integrity Act its full support as well as Governor Gary Herbert who signed this into law on March 26th.
What does all this mean to us?
Given the Federal government and California are going to run headlong into each other over Marijuana legalization and the many assorted states which have sued the federal Government over the Federal Mandated health care measure recently passed, I am not sure that enforcement of the new law will be either timely or upheld.
With jurisdiction challenges not readily answered, Federal vs. States Rights at the forefront of current political debate, and the new ICANN potential extensions to be approved, the legalities are in more of a “Wild West” frontier than perhaps when I started in this industry at the end of the 90’s. I personally would not look for a rash of new convictions nor would I want to be the first one to test Utah’s mettle.
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