Sunday, April 3, 2011

Chapter 7 Homework

1.) Why is Nissan Motor Co. so concerned about the use of the domain names nissan.com and nissan.net and how could monetary damages judgment of $10 could be justified?

The Nissan Motor Company was so concerned because the two sites represented a means of reaching potentially millions of customers who are interested in their product.  By not securing the rights to those names, it creates the appearance that Nissan is behind the times in terms of communications technology and careless in terms of maintaining their brand name, both of which would hurt the company's image in the eyes of potential customers. People who go to those sites expecting to find information about Nissan cars and instead reaching the site of the computer company might also become frustrated and look to another car company whose products are easier to find, which would also hur their bottom line.  There is also the risk of the owners using the sites to libel the company to people who might otherwise have a favorable opinion of the company.  A damages judgment of $10 million might seem excessive, until you consider how many millions the corporation spends in advertising for their products and brand name, and the potential audience reached by those two web addresses.

2.) In about 200 words, provide an outline of the ethics of the position taken by Uzi Nissan in this dispute.

Mr. Uzi Nissan has an established record, going back to when he founded his first company, "Nissan Foreign Car", in 1980 (before Datsun had even changed his name to Nissan) of naming his companies after his family name.  His current business of computer sales and consulting had virtually no overlap with the Nissan Motor Company, so there was little chance of Mr. Nissan engaging in deceptive trade practices, capitalizing on the Nissan Motors brand name for his own gain.  Since Mr. Nissan made no comments at all about Nissan Motors, he could not be said to be defaming Nissan Motors through the ownership and ownership of the domains, either.  Finally, because "Nissan" was the owner's family name, he had a basic right to use that name to represent his own products and services to the public.

3.) In about 200 words, provide an outline of the ethics of the position taken by Nissan Motor Co. in this dispute.

Nissan Motor's argument was that, in the minds of the general public, the name "Nissan" is already associated far more readily with the car company than the computer company.  As such, Nissan Motors would suffer far greater damage to their brand name and image by confused consumers being unable to find Nissan Motors' website, than Mr. Nissan would suffer by having to switch to a different domain.  Nissan Motors could also argue that because Mr. Nissan did not respond to or even acknowledge the attempts at contact by Nissan Motors' legal department, there was a legitimate concern that his intentions were not ethical for the future use of the web domains.  It was reasonable for Nissan Motors to try to protect itself from future use of the websites to confuse customers or libel Nissan Motors.

4.) If you believe that the courts' decisions in this case are fair to the parties and the general public, explain why in about 200 words.  If you believe the courts' decisions are not fair, outline a decision (in about 200 words) that you believe would be fair.

I think the courts' decisions were reasonable.  It sounded like an attempt to split the difference -- Mr. Nissan did not deserve to pay any punitive damages, since he was not using his website to confuse customers or disparage Nissan Motors; and forcing Mr. Nissan to do his computer business under a new name would keep Nissan Motors' potential customers from being confused over the names.  To avoid the appearance of might making right and a multi-billion dollar corporation steamrollering over the small businessman, it makes sense to force both companies to do business using their second choice for a website name, if they cannot come to an agreement for sale of the domain.    

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