www.????.com – Protecting Your Digital Presence

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I wanted to take a break from my usual posts about more traditional construction issues and address a problem that contractors (and businesses in general) are increasingly facing: how to properly secure your long-term digital presence.

As a personal intro, my father, the owner of a mechanical construction company, recently discovered the wonders of the internet, including “the Google” and YouTube (solely for guitar videos).  Since pigs are officially flying, I figure it is only a matter of time before all contractors bring their presence online.  

As a professional intro, I was recently involved with a matter that addressed many of these issues.  Thus, hopefully this post will help organizations deal with these issues before they turn into litigation.

First Issue: Domain names

Securing the proper domain name (www.????.com) for your organization is often the first place to start when creating a website.  Getting a domain name involves registering the name you want with an organization called ICANN (Internet Corporation for Assigned Names and Numbers, a non-profit company that contracts with the government) through a domain name registrar (like GoDaddy.com).

For instance, if you choose a name like “example.com”, you will have to go to a registrar, pay a registration fee that costs between $10-$35.  That will then give you the right to the name for a year, and you will have to renew it annually for the same amount (generally).

If a domain name is available, it is yours.  Basically, think of it as a digital version of the Oklahoma land rush.  Domain names have been disappearing extremely fast.  Thus, if you want a domain name for your site (or future site), act now, or face the agony of having someone else scoop it up first.  After all, $10 for a year’s ownership of the domain name is minimal compared with losing the perfect name for your website.  And, if the domain is already taken, you can always try to buy it from the current owner (but this is often cost prohibitive).

Now what if a domain name that clearly represents the trademark of your company, such as www.uniquecompanyname.com, is already taken.  There are options to gain control if you think someone has registered your trademark with only the intent to profit by selling it to you (often referred to as “cybersquatting”).  Note: generally, a trademark is a distinctive sign or indicator used to identify a company’s products or services to consumers, and to distinguish its products or services from those of other entities.

First, all registrars must follow the Uniform Domain-Name Dispute-Resolution Policy (“UDRP”). Under the policy, most types of trademark-based domain-name disputes must be resolved by agreement, court action, or arbitration before a registrar will cancel, suspend, or transfer a domain name.  However, disputes alleged to arise from abusive registrations of domain names (i.e., cybersquatting) may be addressed by expedited administrative proceedings that the holder of trademark rights initiates by filing a complaint with an approved dispute-resolution service provider.    

Second, you can also file a lawsuit in federal court under the Anticybersquatting Consumer Protection Act (“ACPA”).  The purpose of the law is to thwart cybersquatters who register domain names containing trademarks with no intention of creating a legitimate web site, but instead plan to sell the domain name to the trademark owner or a third-party.

Generally, a UDRP proceeding can be faster and cheaper for trademark owners than an ACPA lawsuit 

Second Issue: Dealings with information technology (“IT”) vendors

In creating and maintaining a website, organizations often rely heavily on internet consultants or vendors, as this is specialized knowledge and is generally better in the hands of professionals.  However, there are risks to such relationships, which can be minimized.  For example, when registering a domain name with a registrar (see above), you have to provide the name of the “registrant.”  The registrant is generally presumed to be the owner, so if your vendor registers as the registrant, it may lead to issues later if you transfer vendors and want to take your domain name with you.

Also, vendors often contract with other third parties for hosting services or to acquire licenses and software on behalf of the client.  These contracts could provide that ownership of the licenses or software is with the vendor.

Overall, any organization that outsources its IT work should have a clear contract that lays out the rights and liabilities of the parties, which may include: specifying what is being purchased, identifying the owner of all relevant items, providing for a smooth unwinding of the relationship at the end of the term, and requiring the vendor to help in a transition.

The irony of a post on an internet blog about helping companies get an online presence is not lost on me.  However, my hope is that anyone with access to “the Google” can find this post and gain some helpful information.

More “Final” and More “Binding”?

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I recently came across a situation concerning a modification of the standard American Institute of Architects (AIA) general conditions that I found very interesting (hopefully you do as well).   

In this situation, an owner and a contractor entered into a contract for the construction of a project.  They used a modified version of the A201-1997 document.  As you may know, subparagraph 4.4.5 of the form document states that the approval or rejection of a Claim by the Architect shall be “final and binding” on the parties but subject to mediation and arbitration.  However, the parties decided to modify the contract and removed subject to mediation and arbitration, as well as all other references to mediation and arbitration.  No language was added concerning review.   

So what next?  What implications arise when the parties remove alternative dispute resolution from the equation?  Is the architect beyond reproach?  Can the parties still litigate?  Such questions made me look at the how Indiana treats situations where the parties to a construction contract designate a party as the final arbiter of all claims, without any articulated review process.

First, it appears to be well-settled in Indiana that contracts appointing a party as sole arbiter, like the situation discussed above, are valid.  Second, judicial review may still be available under certain circumstances.  The court in James I. Barnes Construction Co. v. Washington Township of Starke County, 184 N.E.2d 763 (1962), held that it is a rule of law in Indiana that where a contract provides that work shall be done to the satisfaction, approval or acceptance of an architect or engineer, he is thereby constituted a sole arbitrator by the parties, who are bound by his decision in the absence of fraud or such gross mistake as to imply bad faith or a failure to exercise honest judgment.  Thus, the decision is not absolute.  It appears that this is still the general rule today. 

Other states that appear to have similar cases on point are Massachusetts (Fontaine Bros., Inc. v. City of Springfield) and New Jersey (Ingrassia Construction Co., Inc. v. Vernon Township Board of Education).  This is by no means an exhaustive list. 

Overall, grounds for reviewing the decisions of appointed sole arbiters could include fraud, bad faith, gross mistake, failure to exercise honest judgment, arbitrary and capricious decisions, or decisions outside the scope of her authority.  However, parties should consider the full implications of removing ADR references and be sure that the modified agreement accurately reflects their intent. 

This post is neither final nor binding.  There are other concerns raised by the modification described herein, which may warrant further discussion.  If you have any experiences with such modifications or comments on a different state’s treatment of the issue, drop us a comment.

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