Domains Are NOT Real Estate, KW Research as I. Property: Internet Law Experts Speak Out!

Author: Gab Goldenberg

Are domain names the internet’s real estate? Can keyword research be considered intellectual property? I put these and other questions to Eric Goldman and Mark J Rosenberg, both of whom are speaking on SES San Jose’s legal panel. (Clarification: This is an interview, not coverage of an SES session.)

Contract
(Image: Jason Burrows)

Note: This post only offers information. It does not offer legal advice, counsel or opinion, and should not be relied upon for such. Speak to a lawyer who is a member of your local bar if you need counsel.

1) Are domains really an equivalent to real estate? I asked my real estate prof that and he highlighted a variety of reasons why they aren’t. Ex.: No rights-of-way, usufruct, and other such items.

Eric Goldman (EG): No, domain names are not virtual real estate, and I always chuckle when I see the domainers bloviate about this analogy. Personally, in almost all cases, I’d rather own the top spot on Google for a keyword than to own the keyword.com. I expand on this point more in this lengthy article: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=635803 [Requires some kind of subscription; password confirmation email not hitting my inbox so I'm not linking to them. Talk about SE friendlines... Abstract looks interesting though!]

Mark J. Rosenberg: He [your prof] is right. Domains are like any other personal property. No different than a baseball bat. They can be bought and sold without any special terms and conditions. If used incorrectly, they can cause damage.

2) Can SEOs be considered fiduciaries/trustees for their clients, at least with respect to the site? What criteria would militate in favour and what criteria would oppose such a characterization? Is implementing non-best practices a breach of trust that can constitute a cause of action?

EG: No, I think the analogy to fiduciaries or trustees is way too strong in most cases. In some cases, SEOs can be “agents” of their clients and have the power to bind their clients to legal commitments, but this is probably not the case with the standard SEO-client relationship.

EG: However, like any professional service provider, SEOs could face malpractice or related claims for botching their jobs. I’ve never seen an SEO malpractice claim but I suspect they will come in the future. Even then, the standard for malpractice will be loose (i.e., general incompetence will probably not be deemed malpractice; it will take a higher degree of incompetence to be actionable).

EG: In all cases, an SEO who does a lousy job will develop a poor reputation and suffer some economic consequence accordingly. Also, this issue becomes less important to the extent clients are paying performance bonuses or other compensation tied to results.

MJR: [Whether the SEO is a trustee or not] is most likely a contract specific issue. Unless specified in the contract and/or SEO given special responsibilities, the answer should be no.

MJR: Some of the criteria that would militate in favour are handling money, extensive control and/or operation of site including content. Those that would oppose such a characterization include an SEO acting as a consultant merely providing advice, and having limited or no control over site or its operation.

MJR: [As to breaching a trust by forgoing to implement best practices,] This is case specific. For example, in some situations, there may be a legitimate reason for not implementing a best practice. Otherwise, I would say that depending on the extent of the violation, there may be a claim for breach of contract.


3) Keyword research – can it be considered as intellectual property? If an affiliate manager gives yours away, or a search engine does… are they violating your rights?

EG: It’s possible for the insights derived from researching keywords to be protected under IP. Most likely it would qualify as a trade secret (if it qualifies as IP at all). In order to remain a trade secret, the SEO would have to require everyone who has access to those insights to agree in writing to protect their confidentiality. This can be tricky–especially with the search engines, who aren’t promising anything!

EG: Note, however, that depending on an SEO’s contract with its client, the contract may transfer ownership of the SEO’s work (including their keyword research) to the client. Clients are often as concerned about confidentiality as the SEO, so this can set up some conflict during the contract negotiations. SEOs really interested in protecting their work product, including their keyword research, need to retain an attorney to help them build the proper legal
protections into their contracts and operations.

MJR: It can be considered a trade secret if it is treated as such. If given away without permission, there is a definite violation, provided that it was a trade secret in the first place.

4) What is the standard of care SEOs need to employ in carrying out work for their clients ?

EG: As I mentioned, I don’t think the standard of care has been defined in the courts, and I expect it will take some time before it is. In all cases, the legally defined standard of care will be less rigorous than the marketplace expectations of SEOs’ ability to deliver results. Add value to your clients, and you will be richly rewarded. Chunk it, and your phone will stop ringing.

MJR: There is no special standard. It is to abide by contract terms to the best of their ability while governed by the usual implied covenants and standards under the UCC [Uniform Commercial Code, a US inter-state legal convention aiming to harmonize signatory].

If you liked this post on search marketing and internet law, get SEO ROI Services’ RSS feed.

Tags: , ,

Sidebar Story

Comments

  1. Fantastic post. I've always wanted to sit down with a couple of competent lawyers and have a conversation like this. Thanks for taking those steps for me :)

    Comment by Kyle Wegner - August 19, 2008 @ 9:46am
  2. My pleasure Kyle - thanks for being a regular reader. Go Automaticable! BTW, can you sphinn this since you liked it?

    Comment by Gab Goldenberg - August 19, 2008 @ 1:35pm
  3. I've always had this question in the back of my mind and everything you laid out here makes perfect sense. This is probably one of the most valuable pieces of info I've read on the internet in months... thank you for taking the time to share it with all of us. I think I especially like the baseball bat analogy. I think the only reason that we haven't seen things like SEO malpractice suits is because often people forget that the internet is still the real world, where people are on the other end and those people get hurt. In cases where people have been taken advantage of, I think those people don't realize they can take any kind of action because "it happened on the internet and not in person." Thanks again for the great article and for asking such valuable questions.

    Comment by Loretta - August 21, 2008 @ 1:54pm
  4. Loretta, that's a fascinating insight. I think you've touched on a terrific point that is amplified by the internet: choice-of-forum and the feasability of international lawsuits etc.

    Comment by Gabriel Goldenberg - August 21, 2008 @ 6:37pm
  5. Gabbi, Thanks for the awesome post. I've needed to make a contract for my SEO services for a while, but have never had a disagreement with a client to date. Seems like a prudent idea anyways. So thanks for the awesome post to pass along to somebody who can work with legaleze. -Brad

    Comment by Bradley- the Wordpress SEO - August 22, 2008 @ 12:53am
  6. Hey Gabriel. That is an interesting post. Learned some great points. I believe it is only fair that whoever buys a domain name should be the complete owner no matter what.

    Comment by Joel - seo consultants - October 15, 2008 @ 3:36pm

Leave a Reply