The Utah legislature Wednesday passed set of amendments to its Trademark Protection Act, gutting it of its online ad components and ending the state’s bid to regulate online search engine ads triggered by trademarked keywords.
The amendments were passed at the end of the Utah state legislature’s most recent session after some last-minute wrangling between the House and Senate.
The amendments effectively kill an online advertising law that was widely derided.
“I applaud the Utah legislature for reaching the only logical conclusion available to it — that the Utah Trademark Protection Act was stupid and untenable, so wiping the slate clean was both the best social policy and the lowest cost option,” wrote Santa Clara University law professor Eric Goldman on his advertising and technology blog. “On the other hand, I remain shocked that Utah residents tolerate legislators who screw up this big and waste valuable resources enacting ill-advised laws only to waste more resources reversing themselves.”
Under the original law — which was passed unanimously without a debate — Utah was to establish a database on which companies could register so-called “electronic registration marks” for a yearly fee of up to $250. Competitors would then be banned from buying keyword ads triggered by the registered terms.
Though many executives are in favor of banning competitors from using their trademarked names to trigger online ads, most observers said Utah’s law violated the constitution’s ban on interfering with interstate commerce.
Also, executives with a vested interest in a robust online ad market were adamantly against the law.
After it was passed representatives of Google, eBay, Microsoft, America Online, Yahoo, went to Salt Lake City to explain to the state’s lawmakers how wrongheaded they believed Utah’s Trademark Protection law was.
According to reports, the lawmakers saw their error fairly quickly and set about crafting amendments to avoid a court battle.
Utah has long held a reputation for crafting bad Internet law.
In 2005 it passed a law establishing its infamous child-protection do-not-e-mail registry forcing marketers who want to include in e-mail anything it is illegal for minors to view or buy are to scrub their lists against it for a fee. Rather than protect children, the registry puts them at greater risk of being contacted by online predators, according to the Federal Trade Commission.
Also in 2005, Utah passed a law allowing Utah’s Attorney General to designate porn sites as off limits to Utah. How this would be accomplished was unclear.
“I think it’s safe to say that Utah has an unrivaled track record of enacting dumb, regressive, unproductive Internet laws,” wrote Goldman in another blog post. “But Utah’s three-year battle against keyword advertising represents the strongest support for this assertion.”
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