Craig McTaggart is a member of the KNOWlaw Group of the Toronto law firm of McMillan Binch.
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Many people see a contradiction in the phrase ‘Internet law.’ ‘What law?’ they say. ‘I thought cyberspace was a sort of free-for-all and the law couldn’t apply.’ In its early days, many believed that the Net’s structure (or anarchic lack of structure) would make it impossible for the law to regulate it.
The Net has grown massively. Surfers come from almost every nation – what they share is curiosity and enthusiasm for the Net’s potential. What once linked university networks for rudimentary text-only messages and file transfers has become an unprecedented international communication tool for business, entertainment and education.
The sheer volume of activity now taking place in this global ‘virtual community’ has driven states to try to extend traditional public and private law to Internet conduct. The u.s. legal system, both legislatures and courts, leads the way. For better or worse, the norms of Internet law and custom are largely being established in the u.s., and will eventually affect everybody. Internet law came of age in 1997. What lies ahead in ’98?
A key Internet irony is that the very feature which makes it an unparalleled tool to spread information globally also makes it an unparalleled tool for infringing intellectual property rights. Text, graphics, audio and video files can be ripped off and zapped around the world in seconds. Legal protection for those who toil to create and who own creative works in these formats has traditionally been to forbid the copying and distribution of the works without permission.
A flurry of bills have been introduced in the u.s. Congress to adapt copyright law to this new global medium. Some try to say what will be ‘fair use’ in cyberspace, while others seek to shield Internet service providers from liability for files and messages which their servers carry.
The No Electronic Theft Act became law in the u.s. late last year. It takes the unprecedented step of criminalizing certain infringement activities. Targeted at preventing the non-commercial ‘pirating’ of software and other creative works, the NET Act imposes criminal sanctions tailored to the value of the work and the extent of the infringement.
In Canada, the rules governing use and payment for music on the Internet will be hammered out in 1998. The Copyright Board will hold hearings in April to consider socan’s proposed Tariff 22. Broadcasters, rights owners, authors and performers will clash on how to compensate for the use of music on the Net.
For the first time in Canada, the Copyright Board’s hearings will generate public debate about the nature of the Internet. Many observers believe that this proceeding will set the course for Canadian Net law for several years to come. One key issue will be the tension between the traditional legal prohibition on copying, and the fact that the Internet essentially works by making copies. The u.s. Copyright Office recently put the same issue on its hearing agenda for 1998.
www.yournamehere.com
Trademarks are key assets in the new economy. Lawsuits over domain name grabbing and exclusivity have proliferated in recent years. They will get worse this year. Hundreds of cases will be litigated because enterprises in widely divergent businesses and locales want to have the exclusive right to the Internet domain name that matches their corporate name.
In the old pre-Web world, no one minded if a business in Perth, Australia had the same name as one in Burnaby, b.c. On the Web they are competitors for the same space. While many enterprises may use the name ‘Acme this or that,’ there can be only one ‘www.acme.com’ in the world, as McDonald’s and several other famous companies found out to their expense.
A new twist on Internet trademark disputes turns on ‘meta-tags.’ These small bits of text are embedded in an unseen header to each html page. They are meant to briefly identify each page’s contents. Internet search engines look at these tags to assess whether a page is relevant to a user’s search. Some Website operators load the meta-tags with certain words to push their page up the user’s results list, whether the words accurately describe the page or not.
Using a well-known trademark as a domain name in hopes to attract attention to your site may well infringe trademarks in Canada and the u.s. But what if the well-known mark is not used in a domain name, and is not even visible on the offending Web page? If only search engines can ‘see’ the word, is such use likely to cause confusion as to source in the mind of the public?
Trademark owners might argue that in causing a ‘hit’ the hidden use would lead consumers to the goods and services of another, even though they were looking for the genuine article. u.s. courts will face this novel issue in several cases this year.
Who’s in charge here,
anyway?
With the increasing respectability and sophistication of the Internet, one might assume that it is a stable, publicly administered network. The world increasingly relies on its integrity and stability. The business plans of thousands of firms all over the world hinge on it. What’s not well-known is that no one’s home. The administration of the Internet is essentially a house of cards. No one authority controls it. No one agency plans its development.
The Internet was never meant to be what it is today. The loose-knit, voluntary authority of the Internet survives only by fortuitous cooperation. But this near-anarchy is starting to fray. The number of coveted ‘.com’ addresses is running out. The current administrators are dragged into so many domain name disputes that they probably spend more money defending lawsuits than running the system.
Little wonder that some are asking, ‘By what right are they setting the rules?’ With the right equipment, anybody could act as Internic, the private American agency which currently assigns domain names. This point was dramatized last summer by Eugene Kashpureff, when he diverted traffic headed for the Internic site to his Alternic site, just to show it could be done.
For a time this past fall, this hacker hero resided in a Toronto jail cell, awaiting deportation to the u.s. to face federal wire fraud charges arising from the stunt. A profitable Internic spoof by an Australian hacker last year required an international effort to stamp it out.
Public regulation still far off
The stakes are high in Internet governance, but no stable administration is in sight. The introduction of new top-level domains like ‘.firm’ and ‘.store’ will fix the problem in the short term. So will a decentralized registration procedure. The long-term outlook remains unclear. The International Telecommunications Union, a un agency, has attempted to assert at least notional authority, but that sparked yet another culture clash between the ‘Netheads’ and the ‘Bellheads.’
The computer industry and the phone industry differ radically in culture and world view. They are far apart when it comes to the role of ‘the state.’ Combined with the sheer power of Microsoft and the u.s. government (in that order), and corresponding hatred and distrust of both Bill Gates and Uncle Sam, lack of coherent control over the Internet will frustrate its growth. For many, this is part of the Web’s charm.
Although the crtc has been hands-off on Internet development thus far, technology is making it increasingly difficult to ignore the Net’s revolutionary potential. Television, radio, long-distance telephone and fax service can all be performed credibly today on a modestly equipped home computer with a fast Internet connection. As these technologies become more widespread, the threat to long-established traditions of broadcasting and telecom regulation will increase.
Many believe that once full-length dramatic works or popular television shows can be delivered over the Internet, on sites displaying advertising material, the crtc will have no choice but to respond. The big question facing regulators worldwide is how? The crtc has highlighted its New Media policy in its ‘Action Calendar’ for this year, possibly with public hearings in the fall. Funding mechanisms for content are to have a high profile in this process.
Secrets of the Clickstream
The public is shockingly unaware of the personal privacy threat raised by the Net. The use of ‘cookies’ and ‘data mining’ is being aggressively pursued by direct marketers and database operators. These methods, when layered over conventional consumer information databases, permit the creation of detailed profiles of Web users. Such profiles are used by Web advertising agencies to select which of a series of ads to show you when you visit participating sites.
Would you mind if these data miners knew exactly which Websites you visited last week and how long you spent on each page? Several cookies probably live on your hard drive right now, collecting this information, known as a ‘clickstream.’
Unless you make a habit of actively refusing to accept cookies every time you surf the Web, you are giving away revealing and valuable information about your interests, tastes and preferences. What is more alarming is that the default setting on almost all popular Web browsers is for your computer to accept all cookies without letting you know.
An even more worrying privacy concern is the gathering of personal information on Websites oriented towards children. Visitors to such sites are often asked to enter information in exchange for further content. Such information might include address, phone number, number of residents in the home, parents’ income and toy preferences. Children tend to be willing to provide such boring information when new fun lies behind the next screen.
The u.s. Federal Trade Commission has begun to take action on both cookies and data mining aimed at children. The u.s. Congress is fashioning legislation to address the issue. Yet no one regulates the activities of direct marketing agencies in Canada. The collection and use of personal information are hot political issues in Europe, and their profile should rise in North America this year. Do you know what your clickstream says about you?
1998 promises more Net law
Since the growth of the Internet shows no sign of slowing down (Web traffic reportedly doubled again in 1997), nor will Internet law. Recent American decisions and legislation may seem minor, but they are setting the ‘rules of the road’ before the next generation of this incredible global network arrives.
The Net has exploded worldwide despite woefully inadequate technological capabilities. In the near future these capabilities will improve to the extent that the personal computer will become a genuine rival to the tv, radio, phone and video store. The Bell multimedia trials are giving some London, Ont. residents a glimpse at tomorrow’s high-bandwidth world.
It remains to be seen how, or if, the law will keep up with these changes. Law does tend to lag. The early betting is that it will, eventually, catch up. Until then, be careful out there, and don’t do anything in cyberspace you wouldn’t do in the real world.

(This article contains general comments only. It is not intended to be exhaustive and should not be considered as advice on any particular situation.