Law & Borders The Rise of Law in Cyberspace

Stanford Law Review
Law and Borders: The Rise of Law in Cyberspace

Author(s): David R. Johnson and David Post
Source: Stanford Law Review, Vol. 48, No. 5 (May, 1996), pp. 1367-1402
Published by: Stanford Law Review
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Law And Borders-
The Rise of Law in Cyberspace
David R. Johnson*
and DavidPost**
DavidJohnsonand DavidPost arguethatCyberspacerequiresa systemof

rules quite distinctfrom the laws that regulate physical, geographically-
defined territories. Cyberspacechallenges the law's traditionalreliance on
territorialborders;it is a "space"boundedby screensand passwordsrather
than physical markers. ProfessorsJohnsonand Post illustratehow "taking
Cyberspaceseriously"as a uniqueplace can lead to the developmentof both
clear rulesfor online transactionsand effectivelegal institutions.
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INTRODUCTION
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Global computer-based communications cut across territorialborders, creat-
ing a new realm of human activity and undermining the feasibility-and legiti-
macy-of
o n
laws based on geographic boundaries. While these electronic
communications play havoc with geographic boundaries, a new boundary,
r e d
made up of the screens and passwords that separate the virtual world from the
"real world" of atoms, emerges. This new boundary defines a distinct Cyber-
a
space that needs and can create its own law and legal institutions. Territorially
Sh
based law-makers and law-enforcers find this new environment deeply threat-
ening. But established territorialauthorities may yet learn to defer to the self-
regulatory efforts of Cyberspace participants who care most deeply about this
new digital trade in ideas, information, and services. Separated from doctrine
tied to territorialjurisdictions, new rules will emerge to govern a wide range of
new phenomena that have no clear parallel in the nonvirtual world. These new
rules will play the role of law by defining legal personhood and property,
resolving disputes, and crystallizing a collective conversation about online par-
ticipants' core values.
* Chairmanof Counsel Connect and Co-Directorof the
CyberspaceLaw Institute.
** Visiting Associate Professorof Law, GeorgetownUniversity Law Center and Co-Directorof
the CyberspaceLaw Institute. The authorswish to thank Becky Burr,LarryDownes, Henry J. Perritt,
Jr., and Ron Plesser, as well as the other Fellows of the CyberspaceLaw Institute(JerryBerman,John
Brown, Bill Burrington,EstherDyson, David Farber,Ken Freeling,A. Michael Froomkin,RobertGell-
man, I. Trotter Hardy, Ethan Katsh, Lawrence Lessig, Bill Marmon, Lance Rose, Marc Rotenberg,
Pamela Samuelson, and Eugene Volokh), CLI Co-DirectorsCarey Heckman,John Podesta, and Peggy
Radin, and Jim Campbell,for their assistancein the formulationof these ideas. The usual disclaimer,of
course, applies: the authorsalone are responsible for errors,omissions, misstatements,and misunder-
standings set forth in the following.
1367
1368 STANFORDLAWREVIEW [Vol. 48:1367
I. DOWNTERRITORIAL
BREAKING BORDERS
A. TerritorialBordersin the "RealWorld"
We take for granteda worldin whichgeographicalborders-lines separat-
ing physicalspaces-are of primaryimportancein determininglegal rightsand
responsibilities.1Territorialborders,generallyspeaking,delineateareaswithin
which differentsets of legal rules apply. Therehas until now been a general
correspondencebetween bordersdrawn in physical space (between nation
statesor otherpoliticalentities)andbordersin "lawspace." Forexample,if we
were to superimposea "lawmap"(delineatingareaswheredifferentrulesapply
to particularbehaviors)onto a politicalmap of the world,the two maps would
overlapto a significantdegree, with clustersof homogeneousapplicablelaw
and legal institutionsfittingwithinexisting physicalborders.
1. The TrademarkExample.
Considera specificexampleto which we will referthroughoutthis article:
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trademarklaw-schemes for the protectionof the associationsbetweenwords
_
or images and particularcommercialenterprises.Trademarklaw is distinctly G
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based on geographicalseparations.2Trademarkrightstypicallyarise withina
given country,usuallyon the basis of a markon physicalgoods or in connec-
tion with the provisionof services in specific locations within that country.
o n
Differentcountrieshave differenttrademarklaws, with importantdifferences
on mattersas centralas whetherthe samenamecan be usedin differentlines of
r e d
business. In the UnitedStates,similarbusinessescan even use the same name,
providedthere is sufficientgeographicseparationof use to avoid confusion.3
a
In fact, there are many local stores,restaurants,and businesseswith identical
Sh
names that do not interferewith each other because their customersdo not
overlap. The physicalcues providedby differentlines of businessallow a mark
to be usedby one line of businesswithoutdilutingits valuein others.4Thereis
no global registrationscheme;5protectionof a particularlyfamous markon a
1. See EEOC v. ArabianAmericanOil Co., 499 U.S. 244, 248 (1991) ("Itis a longstandingprinci-
ple of American law 'that legislation of Congress, unless a contraryintent appears,is meant to apply
only within the territorialjurisdictionof the United States.' ") (quoting Foley Bros. v. Filardo,336 U.S.
281, 285 (1949)).
2. See la JEROME GILSON, TRADEMARK PROTECTION ANDPRACTICE ? 9.01 (1991); Dan L. Burk,
TrademarksAlong the Infobahn:A First Look at the EmergingLaw of Cybermarks,1 U. RICH.J.L. &
TECH.1 (1995), available at http://www.urich.edu/jolt/vlil/burk.html; Jeffrey M. Samuels & Linda B.
Samuels, The Changing Landscape of International TrademarkLaw, 27 GEO.WASH.J. INT'LL. &
ECON.433, 433 (1993-94).
3. Dawn Donut Co. v. Hart's Food Stores, 267 F.2d 358, 365 (2d. Cir. 1959) (holding that the
owner of a registeredtrademarkmay not enjoin another'suse of that mark in a geographicallyseparate
market if the holder of the registeredmark does not intend to expand into that market).
4. See, e.g., CaliforniaFruit GrowersExch. v. Sunkist Baking Co., 166 F.2d 971 (7th Cir. 1947)
(finding that the sale of "Sunkist"fruits and "Sunkist"bakery productsin the same marketwould not
cause consumer confusion); RestaurantLutece Inc. v. Houbigant,Inc., 593 F. Supp. 588 (D.N.J. 1984)
(denying a preliminaryinjunctionby the restaurant"Lutece"againsta company wishing to sell "Lutece"
perfume and cosmetics).
5. Clark W. Lackert, International Efforts Against TrademarkCounterfeiting,COLUM.Bus. L.
REV. 161 (1988); Samuels & Samuels, supra note 2, at 433.
May 1996] RISE OF LAWIN CYBERSPACE 1369
global basis requiresregistrationin each country. A trademarkowner must

thereforealso be constantlyalertto territoriallybased claims of abandonment,
andto dilutionarisingfromuses of confusinglysimilarmarks,andmustmaster
each country'sdifferentproceduralandjurisdictionallaws.
2. WhenGeographicBoundariesfor Law MakeSense.
Physical bordersare not, of course, simply arbitrarycreations. Although
they may be based on historicalaccident,geographicbordersfor law make
sense in the real world. Theirlogical relationshipto the developmentand en-
forcementof legal rules is based on a numberof relatedconsiderations.
Power. Controlover physicalspace, and the people and things located in
that space, is a definingattributeof sovereigntyand statehood.6Law-making
requiressome mechanismfor law enforcement,which in turndependson the
ability to exercise physical control over, and impose coercive sanctionson,
law-violators. For example, the U.S. governmentdoes not impose its trade-
marklaw on a Brazilianbusiness operatingin Brazil, at least in partbecause
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imposingsanctionson the Brazilianbusinesswould requireassertionof physi-
_
cal controlover businessowners. Such an assertionof controlwould conflict G
its citizens.7
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with the Braziliangovernment'srecognizedmonopolyon the use of force over
Effects. The correspondencebetweenphysicalboundariesand "lawspace"
o n
boundariesalso reflectsa deeply rootedrelationshipbetweenphysicalproxim-
ity and the effects of any particularbehavior. Thatis, Braziliantrademarklaw
d
governsthe use of marksin Brazilbecausethatuse has a moredirectimpacton
e
personsand assets withinBrazilthananywhereelse. Forexample,a largesign
over "Jones'Restaurant"
r in Rio de Janeirois unlikelyto have an impacton the
a
Sh
operation of "Jones' Restaurant" in Oslo, Norway, for we may assume that
thereis no substantialoverlapbetweenthe customers,or competitors,of these
two entities. Protectionof the former's trademarkdoes not-and probably
should not-affect the protectionaffordedthe latter's.
Legitimacy.We generallyacceptthe notionthatthe personswithina geo-
graphicallydefinedborderare the ultimatesourceof law-makingauthorityfor
6. RESTATEMENT (THIRD) OF FOREIGN RELATIONS LAW OF THE UNITED STATES ? 201 (1987)
("Underinternationallaw, a state is an entity that has a defined territoryand a permanentpopulation,
under the control of its own government ... ."); id. ? 402 ("[A] state has jurisdictionto prescribe law
with respect to (l)(a) conduct that, wholly or in substantialpart, takes place within its territory;(b) the
status of persons, or interests in things, presentwithin its territory;(c) conduct outside its territorythat
has or is intendedto have substantialeffect within its territory...."); see also Lea Brilmayer,Consent,
Contract,and Territory,74 MINN.L. REV.1, 10-17 (arguingthat a consent theoryof statehoodrelies on
prior assumptionsof territorialsovereignty).
7. The sovereign's ability to claim personaljurisdictionover a particularparty turns importantly
on the party's relationshipto the physical jurisdiction over which the sovereign has control, e.g., the
presence of the party or the party's assets, within the jurisdiction, or activities of the party that are
directed to persons or things within the jurisdiction. Similarly, the law chosen to apply to a contract,
tort, or criminal action has historicallybeen influencedprimarilyby the physical location of the parties
or the deed in question. See generally HENRY H. PERRITT JR.,Jurisdictionin Cyberspace,in LAWAND
THEINFORMATION SUPERHIGHWAY (forthcoming 1996) (discussing the "conventionaldoctrines"of per-
sonal jurisdiction and choice of law and the shortcomingsof these geographically-basedconcepts as
applied to Cyberspace).
activitieswithinthatborder.8The "consentof the governed"impliesthatthose

subjectto a set of laws musthave a role in theirformulation.By virtueof the
precedingconsiderations,those people subjectto a sovereign'slaws, and most
deeply affectedby those laws, are the individualswho are locatedin particular
physicalspaces. Similarly,allocationof responsibilityamonglevels of govern-
mentproceedson the assumptionthat,for manylegal problems,physicalprox-
imity betweenthe responsibleauthorityandthose most directlyaffectedby the
law will improvethe qualityof decision making,and thatit is easier to deter-
mine the will of those individualsin physicalproximityto one another.
Notice. Physicalboundariesarealso appropriate for the delineationof "law
space" in the physicalworldbecause they can give noticethatthe ruleschange
when the boundariesare crossed. Properboundarieshave signpoststhat pro-
vide warningthatwe will be required,aftercrossing,to abideby differentrules,
and physicalboundaries-lines on the geographicalmap-are generallywell-
equippedto serve this signpostfunction.9
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B. The Absenceof TerritorialBordersin Cyberspace
_
Cyberspaceradicallyunderminesthe relationshipbetween legally signifi- G
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cant (online) phenomenaand physical location. The rise of the global com-
puternetworkis destroyingthe link betweengeographicallocationand:(1) the
o n
power of local governmentsto assertcontrolover online behavior;(2) the ef-
fects of online behavioron individualsor things;(3) the legitimacyof a local
d
sovereign'seffortsto regulateglobalphenomena;and(4) the abilityof physical
e
location to give notice of which sets of rules apply. The Net thus radically
r
subvertsthe systemof rule-makingbasedon bordersbetweenphysicalspaces,
a
at least with respectto the claim thatCyberspaceshouldnaturallybe governed
Sh
by territoriallydefinedrules.
Cyberspacehas no territoriallybased boundaries,because the cost and
speed of message transmissionon the Net is almost entirely independentof
physical location. Messagescan be transmittedfrom one physicallocationto
any otherlocationwithoutdegradation,decay,or substantialdelay, andwithout
any physicalcues or barriersthatmightotherwisekeep certaingeographically
8. Declaration on Principles of InternationalLaw Concerning Friendly Relations and Co-opera-

tion Among States in Accordancewith the Charterof the UnitedNations, G.A. Res. 2625, U.N. GAOR
6th Comm., 25th Sess., Agenda Item 85, at 121 (1970); Declaration of the Inadmissibilityof Interven-
tion in the Domestic Affairs of States and the Protection of their Independenceand Sovereignty, G.A.
Res. 2131, U.N GAOR 1st Comm., 20th Sess., Agenda Item 107, at 11 (1965); see generally Brilmayer,
supra note 6 (arguingthat a state's power cannotbe explained solely by consent theory since territorial
sovereignty must also be presumed).
9. The exception that proves this rule is the outrage we feel when a journalist who crosses a
territorialboundarywithoutany signs is imprisonedfor a supposedoffense againstthe local state. Some
"signposts"are culturallyunderstoodconventionsthat accompanyentry into specialized places, such as
courtrooms,office buildings, and churches. But not all signposts and boundariesdividing differentrule
sets are geographicallyor physically based. Sets of differentrules may apply when the affected parties
play particularroles, such as membersof self-regulatoryorganizations,agents of corporateentities, and
so forth. Henry H. Perritt, Jr., Selfgovering Electronic Communities 36-49, 59-60 (Apr. 2, 1995)
(unpublishedmanuscript,on file with the StanfordLaw Review). But even these roles are most often
clearly markedby cues of dress, or formal signaturesthat give warning of the applicable rules.
May 1996] RISEOF LAWIN CYBERSPACE 1371
remoteplaces and people separatefromone another.10The Net enablestrans-

actions between people who do not know, and in many cases cannot know,
each other's physical location. Locationremainsvitally important,but only
location within a virtual space consistingof the "addresses"of the machines
betweenwhich messagesandinformationarerouted. The systemis indifferent
to thephysicallocationof thosemachines,andthereis no necessaryconnection
between an Internetaddressand a physicaljurisdiction.Althoughthe domain
name initiallyassignedto a given machinemay be associatedwith an Internet
Protocoladdressthat correspondsto that machine'sphysicallocation(for ex-
ample,a ".uk"domainnameextension),the machinemaybe physicallymoved
without affecting its domain name. Alternatively,the owner of the domain
name mightrequestthatthe namebecomeassociatedwith an entirelydifferent
machine,in a differentphysicallocation.1 Thus,a serverwith a ".uk"domain
name need not be locatedin the UnitedKingdom,a serverwith a ".com"do-
main name may be anywhere,and users, generally speaking, are not even
awareof the locationof the serverthat storesthe contentthat they read.
o d
The powerto controlactivityin Cyberspacehas only the most tenuouscon-
_
nectionsto physical location. Nonetheless,many governments'firstresponse
G
C
to electroniccommunicationscrossingtheirterritorialbordersis to try to stop
or regulatethat flow of information.'2Ratherthan permittingself-regulation
R
by participantsin online transactions,manygovernmentsestablishtradebarri-
o n
ers, attemptto tax border-crossingcargo, and respondespecially sympatheti-
cally to claims that informationcoming into the jurisdictionmight prove
d
harmfulto local residents. As online informationbecomes more importantto
e
local citizens, these efforts increase. In particular,resistanceto "transborder
r
data flow" (TDF) reflectsthe concernsof sovereignnationsthat the develop-
a
Sh
10. As Woody Allen once quipped: "Spaceis nature'sway of keeping everythingfrom happening
to you." Although there is distance in online space, it behaves differently from distance in real space.
See M. ETHANKATSH, THEELECTRONIC MEDIAANDTHETRANSFORMATION OFLAW92-94 (1989) (dis-
cussing the benefits of moving data over great distances at high speeds and the potentialrisks of trans-
forming that data in the process); M. ETHANKATSH,LAWIN A DIGITAL WORLD57-64, 218 (1995)
(noting that although physical distance is becoming less of an obstacle in the age of computers,elec-
tronic communicationmay create informationaldistance).
11. For a generaldescriptionof the Domain Name System, see Burk,supra note 2, at para. 12-14;
see also R. Bush, B. Carpenter& J. Postel, Delegation of InternationalTop Level Domains (Jan. 1996),
available at ftp://ds.intemic.net/intemet-drafts/draft-ymbk-itld-admin-00.txt (describing how to ensure
an open and competitive internationalmarketfor domain names); P. Mockapetris,RFC 882, Domain
Names-Concepts and Facilities (Nov. 1983), available at ftp://ds.intemic.net/rfc/rfc882.txt (discussing
the basic principles of domain names); P. Mockapetris,RFC 883, Domain Names-Implementation and
Specifications (Nov. 1983), available at ftp://ds.intemic.net/rfc/rfc883.txt
(discussing the use of domain
names in mail systems and other network software).
12. See Jon Auerbach,Fences in Cyberspace:GovernmentsMove to Limit Free Flow of the In-
ternet, BOSTON GLOBE,Feb. 1, 1996, at 1 (describing how government censorship and filtrationhas
caused "digital Balkanization"of the Internet);Seth Faison, Chinese Cruise Internet, Waryof Watch-
dogs, N.Y. TIMES,Feb. 5, 1996, at Al (describingthe Chinese government'sregulatoryattemptsto steer
"the flow of electronic informationthroughofficially controlledparts");see generally Anne Wells Bran-
scomb, JurisdictionalQuandariesfor Global Networks,in GLOBAL NETWORKS: COMPUTERS ANDINTER-
NATIONAL COMMUNICATION 83, 103 (Linda M. Harasim ed., 1993) (exploring efforts to exercise
jurisdictional control over electronic informationservices).
mentanduse of TDF's will underminetheir"informational sovereignty,"13 will

impinge upon the privacyof local citizens,14and will upset privateproperty
interestsin information.15Even local governmentsin the United States have
expressedconcernabouttheirloss of controlover informationand transactions
flowing across their borders.16
But efforts to control the flow of electronicinformationacross physical
borders-to map local regulationand physicalboundariesonto Cyberspace-
are likely to prove futile, at least in countriesthathope to participatein global
commerce.17Individualelectronscan easily, andwithoutany realisticprospect
of detection,"enter"any sovereign'sterritory.The volume of electroniccom-
municationscrossing territorialboundariesis just too great in relationto the
resourcesavailableto governmentauthorities.UnitedStatesCustomsofficials
have generallygiven up. They assertjurisdictiononly over the physicalgoods
thatcross the geographicbordersthey guardandclaim no rightto force decla-
rationsof the value of materialstransmittedby modem.18Bankingand securi-
o d
G
13. Anthony Paul Miller, Teleinformatics,TransborderData Flows and the Emerging Struggle
for Information:An Introductionto the Arrival of the New InformationAge, 20 COLUM.
_
J.L. & Soc.
PROBS. 89, 107-08(1986). Millerdiscussesthewillingnessof somenationalgovernments to forgothe
C
benefitsof unregulated TDF'sso as to protecttheirpolitical,social,andculturalinterests.Id.at 107-08,
127-35.
izedpersonaldatahasprompted
andgovernments throughout
theOrganization
n R
14. Id.at 105-07,111-18(suggestingthattheperceivedthreatof theexploitative
forEconomicCooperation
useof computer-
andDevelopment (OCED)
WesternEuropeto restrictthecontentof TDF'sso as to protectindividual
andcorporateprivacy).
d o
15. Id. at 109-11(notingthe attempt,particularly amongcomputersoftwaredevelopers,to curb
the threatthatTDF'spose to intellectualpropertyrights);see also DoreenCarvajal,BookPublishers
r e
WorryAboutThreatof Internet,N.Y. TIMES, Mar.18, 1996,at Al (describingthe appearance
Internetof Le GrandSecret,a bookaboutformerFrenchPresident
a
FrancoisMitterand,
banningof the bookanddiscussingthe bookpublishers'generalconcernaboutunauthorized
on the
despiteFrance's
Internet
Sh
distributions).
16. Forexample,A. JaredSilverman,formerchief of the New JerseyBureauof Securities,ex-
pressedconcernabouttheabilityof theStateto protectits residentsagainstfraudulent schemesif it does
not assertthe rightto regulateeveryonlinesecuritiesofferingaccessible,via the net, fromwithinthe
State. A. JaredSilverman,OnlineOfferings:Is Cyberspacea Mediumfor CapitalFormation,or a
JurisdictionUnto Itself?2-3 (Jan.1996)(unpublished manuscript, on file withthe StanfordLawRe-
view); see also GregorySpears, Cops and Robberson the Net, KIPLINGER'SPERS.FIN.MAG.,Feb. 1995,
at 56 (surveyingstatesecuritiesregulators'
responsesto onlineinvestmentscams). Moreover,various
stateattorneysgeneralhaveexpressedconcernaboutgamblingandconsumerfraudreachingtheirstate's
residentsoverthe net. See note21 infra.
17. The difficultyof policingan electronicbordermay have somethingto do with its relative
length. See ProfessorPeterMartin,Commentat the NewJurisElectronicConference(Sept.22, 1993)
(discussingcyberspace's"nearinfiniteboundary" as comparedwithterritorial
jurisdictions).Physical
roadsandportslinkingsovereignterritories are few in number,andgeographical boundaries can be
fencedandpoliced. In contrast,the numberof startingpointsfor an electronic"trip"out of a given
countryis staggering,
consistingof everytelephonecapableof connectingoutsidetheterritory.Evenif
electroniccommunications areconcentrated intohighvolumeconnections, a customshouseon an elec-
tronicborderwouldcausea massivetrafficjam,threatening theveryelectroniccommercesuchfacilities
wereconstructed to encourage.
18. Cf INFORMATION INFRASTRUCTURE TASK FORCE, INTELLECTUAL PROPERTY AND THE NA-
TIONAL INFORMATION INFRASTRUCTURE: THE REPORT OF THE WORKING GROUP ON INTELLECTUAL PROP-
ERTY RIGHTS221 (1995)(hereinafter
"WhitePaper")("Although we recognizethatthe U.S. Customs
Servicecannot,for all practicalpurposes,enforcea prohibition on importation by transmission,
given
theglobaldimensionsof theinformation infrastructureof thefuture,it is important
thatcopyrightown-
ers havetheotherremediesforinfringements of thistypeavailableto them.").Ironically,theVoiceof
Americacannotpreventtheinformation it placeson theNet fromdoublingbackintotheUnitedStates,
May 1996] RISE OF LAW IN CYBERSPACE 1373
ties regulatorsseem likely to lose theirbattleto impose local regulationson a

global financialmarketplace.19And state attorneysgeneralface seriouschal-
lenges in seekingto interceptthe electronsthattransmitthe kinds of consumer
fraudthat,if conductedphysicallywithinthe localjurisdiction,wouldbe easier
to shut down.
Faced with their inabilityto controlthe flow of electronsacross physical
borders,some authoritiesstrive to inject their boundariesinto the new elec-
tronic medium throughfilteringmechanismsand the establishmentof elec-
tronic barriers.20Othershave been quick to assert the right to regulateall
even though this domestic disseminationviolates the 1948 Smith-MundtAct. John Schwartz,Over the
Net and Around the Law, WASH.POST,Jan. 14, 1995, at Cl.
19. See WALTERB. WRISTON, THE TWILIGHT OF SOVEREIGNTY: How THE INFORMATION REVOLU-
TION ISTRANFORMING OURWORLD 61 (1992) (noting that the new financialmarket"is not a geographic
location to be found on a map but rathermore than two hundredthousandelectronic monitorsall over
the world that are linked together"and that "no one is in control"). Wriston adds:
o d
Technology has made us a "global"communityin the literalsense of the word. Whether
we are ready or not, mankind now has a completely integratedinternationalfinancial and
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informationmarketplacecapable of moving money and ideas to any place on this planet in
minutes. Capitalwill go where it is wanted and stay where it is well treated. It will flee from
manipulationor onerous regulationof its value or use, and no governmentpower can restrain
it for long.
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Id. at 61-62. The Securities and Exchange Commission has taken the position that securities offerings
"thatoccur outside the United States"are not subjectto the registrationrequirementsof Section 5 of the
n
Securities Act of 1933, even if United States residents are the purchasersin the overseas market. 17
o
C.F.R. ? 230.901 (1995); see also 17 C.F.R. ? 230.903 (1995) (saying that in orderfor offers and sales
to be deemed to "occuroutside the United States,"there must be, inter alia, "no directedselling efforts
d
... made in the United States");17 C.F.R. ? 230.902(b)(1) (1995) (defining"directedselling efforts"as
"any activity undertakenfor the purpose of, or that could reasonablybe expected to have the effect of,
a r e
conditioningthe marketin the United States"for the securitiesin question). If, as many predict,trading
on physical exchanges increasinglygives way to computerizedtrading,see, e.g., Therese H. Maynard,
Whatis an "Exchange"-Proprietary Electronic Securities TradingSystems and the StatutoryDefini-
Sh
tion of an Exchange, 49 WASH.& LEEL. REV.833, 862-63 (1992), Lewis D. Solomon & Louise Corso,
The Impact of Technologyon the Tradingof Securities: The EmergingGlobal Marketand the Implica-
tions for Regulation, 24 J. MARSHALL L. REV.299, 318-19 (1991), this rule will inevitably become
increasinglydifficult to apply on a coherentbasis; where, in such a market,does the offer "occur"? Can
information about the offering placed on the World Wide Web "reasonablybe expected to have the
effect of conditioning the market in the United States" for the securities in question? See id. at 330
(noting that "[c]hoice of law questions take on a new dimension in the electronic global market"). The
authors wish to thank Professor MerrittFox for drawing our attentionto these issues in the securities
context. MerrittFox, The Political Economy of StatutoryReach: U.S. Disclosure Rules for a Globaliz-
ing Marketfor Securities, Address at GeorgetownUniversity Law Center (Mar. 6, 1996).
20. For example, the Germangovernment,seeking to enforce its laws against distributionof por-
nographicmaterial,orderedCompuServeto disable access by Germanresidentsto certainglobal Usenet
newsgroups. KarenKaplan, GermanyForces Online Service to Censor Internet,L.A. TIMES,Dec. 29,
1995, at Al; Ruth Walker, WhyFree-WheelingInternetHits TeutonicWall Over Porn, CHRISTIAN SCI.
MONITOR,Jan. 4, 1996, at 1; CyberpornDebate Goes International;see also Kara Swisher, Germany
Pulls the Shade On CompuServe,Internet,WASH.POST,Jan. 1, 1996, at F13. Anyone inside Germany
with an Interet connectioncould easily find a way to access the prohibitednews groupsduringthe ban,
for instance by linking up throughanothercountry. Auerbach,supra note 12, at 15. Although initially
compliant, CompuServesubsequentlyrescindedthe ban on most of the files by sending parentsa new
programto choose for themselves what items to restrict. CompuServeEnds Access Suspension: It Re-
opens All But Five Adult-OrientedNewsgroups, L.A. TIMES, Feb. 14, 1996, at D1.
Similarly, Tennessee may insist (indirectly, through enforcementof a federal law that defers to
local community standards)that an electronic bulletin board operated in California install filters that
preventoffensive screens from being displayed to users in Tennessee if the operatorsare to avoid liabil-
ity under Tennessee's local obscenity standards. See United States v. Thomas, 74 F.3d 701 (6th Cir.
1996) (affirming a California couple's convictions under federal obscenity laws for postings made in
online tradeinsofar as it might adverselyaffect local citizens. The Attorney

Generalof Minnesota,for example,has assertedthe rightto regulategambling
that occurs on a foreignweb page that a local residentaccessed and "brought
into" the state.21 The New Jersey securitiesregulatoryagency has similarly
assertedthe rightto shutdown any offendingWeb page accessiblefromwithin
the state.22
But such protectiveschemeswill likely fail as well. First,the determined
seekerof prohibitedcommunicationscan simplyreconfigurehis connectionso
as to appearto residein a locationoutsidethe particularlocality,state,or coun-
try. Because the Net is engineeredto workon the basis of "logical,"not geo-
graphical,locations,any attemptto defeatthe independenceof messagesfrom
physical locationswould be as futile as an effort to tie an atom and a bit to-
gether. And, moreover,assertionsof law-makingauthorityover Net activities
on the groundthatthose activitiesconstitute"entryinto"the physicaljurisdic-
tion can just as easily be madeby any territorially-based authority.If Minne-
sota law applies to gamblingoperationsconductedon the WorldWide Web
o d
because such operationsforeseeablyaffect Minnesotaresidents,so, too, must
_
the law of any physicaljurisdictionfrom which those operationscan be ac- G
R C
cessed. By assertinga rightto regulatewhateverits citizensmay access on the
Net, these local authoritiesare layingthe predicatefor an argumentthatSinga-
pore or Iraqor any othersovereigncan regulatethe activitiesof U.S. compa-
o n
nies operatingin Cyberspacefrom a location physically within the United
States. All such Web-basedactivity,in this view, must be subjectsimultane-
r e d
ously to the laws of all territorialsovereigns.
a
California to an electronic bulletin board that was accessible from and offensive to the community
Sh
standardsof Tennessee; see also ElectronicFrontierFoundation,A VirtualAmicusBrief in the Amateur
Action Appeal, available at http://www.eff.org/pub/Legal/Cases/AABBS-Thomases-Memphis/Old/
aa- eff-vbrief.html. The bulletin boardin this case had very clear warningsand passwordprotection.
This intangible boundarylimited entranceto only those who freely chose to see the materialsand ac-
cepted the system operator's rules. Id. It is our contention that posting offensive materials in areas
where unwilling readersmay come across them inadvertentlyraises problemsthat are best addressedby
those who understandthe technology involved, ratherthan by extrapolatingfrom the conflicting laws of
multiple geographicjurisdictions.
21. The Minnesota Attorney General's Office posted a warning statementstating that "[p]ersons
outside of Minnesota who transmitinformationvia the Internetknowing that informationwill be dis-
seminated in Minnesota are subject to jurisdiction in Minnesota courts for violations of state criminal
and civil laws." Warning to all Internet Users and Providers, available at http://www.state.mn.us/
ebranch/ag/memo.txt.(emphasisomitted). The assertionof jurisdictionrested on the Minnesotageneral
criminaljurisdiction statute,which provides that "[a] person may be convicted and sentenced underthe
law of this State if the person ... (3) Being without the state, intentionallycauses a result within the
state prohibitedby the criminal laws of this state." MINN.STAT.ANN.? 609.025 (West 1987). Minne-
sota also began civil proceedings against Wagernet,a Nevada gambling business which posted an In-
ternet advertisementfor online gambling services. See Complaint,Minnesota v. GraniteGate Resorts,
Inc., No. 9507227 (1995), available at http://www.state.mn.us/ebranch/ag/ggcom.txt. The FloridaAttor-
ney General, by contrast,contends that it is illegal to use the Web to gamble from within Florida but
concedes that the Attorney General's office should not waste time trying to enforce the unenforceable.
95-70 Op. Fla. Att'y Gen. (1995), available at http://legal.fir.edu/units/opinions/95-70.html. For a
general discussion of these pronouncements,see Mark Eckenwiler, States Get Entangled in the Web,
LEGALTIMES,Jan. 22. 1996, at S35.
22. See State Regulators CrackDown on "InformationHighway" Scams, DAILYREP.FOREXEC.
(BNA), July 1, 1994, available in Westlaw, BNA-DER database, 1994 DER 125, at d16.
Nor are the effects of online activitiestied to geographicallyproximatelo-

cations. Informationavailableon the WorldWide Web is availablesimultane-
ously to anyonewith a connectionto the global network. The notion that the
effects of an activity taking place on that Web site radiatefrom a physical
location over a geographicmap in concentriccircles of decreasingintensity,
howeversensible that may be in the nonvirtualworld,is incoherentwhen ap-
plied to Cyberspace.A Web site physicallylocatedin Brazil,to continuewith
thatexample,has no moreof an effect on individualsin Brazilthandoes a Web
site physicallylocatedin Belgiumor Belize thatis accessiblein Brazil. Usenet
discussiongroups,to take anotherexample,consist of continuouslychanging
collections of messagesthat are routedfrom one networkto another,with no
centralizedlocationat all. Theyexist, in effect, everywhere,nowherein partic-
ular, and only on the Net.23
d
Territorialregulationof online activitiesserves neitherthe legitimacynor
o
the notice justifications.Thereis no geographicallylocalized set of constitu-
ents with a strongerand more legitimateclaim to regulateit than any other
local group. The strongestclaim to controlcomes fromthe participantsthem-
_
selves, and they could be anywhere. And in Cyberspace,physicalbordersno G
R C
longer functionas signpostsinformingindividualsof the obligationsassumed
by enteringinto a new, legally significant,place. Individualsare unawareof
o n
the existence of those bordersas they move throughvirtualspace.
The rise of an electronicmediumthat disregardsgeographicalboundaries
d
throwsthe law into disarrayby creatingentirelynew phenomenathat need to
e
become the subjectof clear legal rulesbut thatcannotbe governed,satisfacto-
r
rily, by any currentterritoriallybased sovereign. For example, althoughpri-
a
vacy on the Net may be a familiarconcept,analogousto privacydoctrinefor
Sh
mail systems, telephonecalls, and printpublications,electroniccommunica-
tions createseriousquestionsregardingthe natureand adequacyof geographi-
cally based privacy protections. Communicationsthat create vast new
transactionalrecordsmay pass throughor even simultaneouslyexist in many
23. See David G. Post, The State of Nature and the First InternetWar,REASON, Apr. 1996, at 30-
31 (describing the operation of the alt.religion.scientology Usenet group). Groups like
alt.religion.scientology
come into existence when someone . . . sends a proposalto establish the group to the specific
newsgroup(named "alt.config")set up for receiving such proposals. The operatorsof each of
the thousands of computer networks hooked up to the Internetare then free to carry, or to
ignore, the proposed group. If a networkchooses to carry the newsgroup,its computerswill
be instructedto make the alt.religion.scientology"feed,"i.e., the streamof messages posted to
alt.religion.scientologyarrivingfrom other participatingnetworks,accessible to its users, who
can read-and, if they wish, add to-this streambefore it is passed along to the next network
in the worldwidechain. It's a completely decentralizedorganism-in technical terms, a "dis-
tributed database"-whose content is constantly changing as it moves silently around the
globe from networkto networkand machineto machine,never settling down in any one legal
jurisdiction, or on any one computer.
Id.; see generally What is Usenet?, available at http://www.smartpages.com/bngfaqs/news/announce/
newusers/top.html; Answers to Frequently Asked Questions about Usenet, available at http://
www.smartpages.com/bngfaqs/news/announce/newusers/top.html.
differentterritorialjurisdictions.24What substantivelaw should we apply to

protectthis new, vulnerablebody of transactionaldata?25May a Frenchpo-
licemanlawfullyaccess the recordsof communicationstravelingacrossthe Net
from the United States to Japan? Similarly,whetherit is permissiblefor a
commercialentityto publisha recordof all of any given individual'spostings
to Usenet newsgroups,or whetherit is permissibleto implementan interactive
Web page applicationthat inspectsa user's "bookmarks" to determinewhich
otherpages thatuserhas visited,arequestionsnot readilyaddressedby existing
legal regimes-both becausethe phenomenaare novel and becauseany given
local territorialsovereign cannot readily control the relevant, globally dis-
persed,actorsand actions.26
Becauseevents on the Net occureverywherebut nowherein particular,are
engagedin by onlinepersonaewho areboth"real"(possessingreputations,able
to performservices,anddeployintellectualassets)and"intangible"(not neces-
sarilyor traceablytied to any particularpersonin the physicalsense), andcon-
cern "things" (messages, databases, standing relationships)that are not
o d
necessarilyseparatedfromone anotherby any physicalboundaries,no physical
_
jurisdictionhas a morecompellingclaim thanany otherto subjectthese events G
exclusively to its laws.
R C
o n
The questionof who shouldregulateor controlNet domainnamespresents
an illustrationof the difficultiesfaced by territoriallybased law-making. The
r d
engineerswho createdthe Net deviseda "domainnamesystem"thatassociates
e
numericalmachine addresseswith easier-to-remember names. Thus, an In-
a
ternetProtocolmachineaddresslike "36.21.0.69"can be derived,by meansof
Sh
a lookuptable, from "leland.stanford.edu." Certainletterextensions (".com,"
".edu,"".org,"and ".net")have developedas global domainswith no associa-
24. Europeancountriestry to protectdataabouttheircitizens by banningthe exportof information
to countriesthat do not afford sufficientprotections. See Peter Blume, An EEC Policy for Data Protec-
tion, 11 COMPUTER/L. J. 399 (1992); Joseph I. Rosenbaum,The EuropeanCommission'sDraft Directive
on Data Protection, 33 JURIMETRICS J. 1, 4-12 (1992); Symposium, Data Protection and the European
Union's Directive: The Challengefor the United States, 80 IOWAL. REV.431 (1995). But the data
regardingtheir citizens' activities may not be subject to the countries' control-the data may originate
as a result of actions recordedon outside servers.
25. See Joel R. Reidenberg, The Privacy Obstacle Course: Hurdling Barriers to Transnational
Financial Services, 60 FORDHAM L. REV.S137 (1992); David Post, Hansel & Gretel in Cyberspace,
AM. LAW.,Oct. 1995, at 110.
26. Many new issues posed by phenomenaunique to the Net are even less familiar than the pri-
vacy issue. For example, because electronic communicationsare not necessarily tied to real world
identities, new questions about the rights to continuedexistence, or to protectionof the reputation,of a
pseudonym arise. Also, there are new forms of offensive behavior that the Net makes possible. The
potential to launch a computer virus or to "spam the net" by sending multiple offpoint messages to
newsgroups, for example, creates a need to define rules governing online behavior. And the increased
communication that the Net offers has brought together people that otherwise would not have met.
When large numbersof people collaborateacross the Net to create services or works of value, we face
questions of whetherthey have formeda corporateentity or partnershipwith rightsand duties of its own
that are distinct from those of the individualparticipants. This new entity may have been created in a
context in which there was no "registration"with any particulargeographic authorityand in which the
rights of any such authorityto regulate that new "legal person"remain unsettled.
tion to any particulargeographicarea.27Althoughthe Net creatorsdesigned

this systemas a convenience,it rapidlydevelopedcommercialvalue,becauseit
allows customersto learnand rememberthe locationof particularWeb pages
or e-mail addresses. Currently,domainnamesare registeredwith specificpar-
ties who echo the informationto "domainname servers"aroundthe world.
Registrationgenerallyoccurson a "firstcome, firstserved"basis, generatinga
new type of propertyakin to trademarkrights,but withoutinherentties to the
trademarklaw of any individualcountry.28Definingrightsin this new, valua-
ble propertypresentsmanyquestions,includingthose relatingto transferability,
conditions for ownership(such as paymentof registrationfees), durationof
ownershiprights,andforfeiturein the event of abandonment, howeverdefined.
Who should make these rules?
Considerthe placementof a "traditional" trademarkon the face of a World
Wide Web page. This page can be accessedinstantlyfrom any locationcon-
nectedto the Net. It is not clearthatany given country'strademarkauthorities
possess, or shouldpossess,jurisdictionover such placements. Otherwise,any
o d
use of a trademarkon the Net wouldbe subjectsimultaneouslyto the jurisdic-
_
tion of every country. Shoulda Web page advertisinga local businessin Illi-
G
C
nois be deemedto infringea trademarkin Braziljust becausethe page can be
accessed freely from Brazil? LargeU.S. companiesmay be upset by the ap-
n R
pearanceon the Web of namesand symbolsthatoverlapwith theirvalid U.S.-
registeredtrademarks.But these same names and symbols could also be val-
d o
idly registeredby anotherpartyin Mexico whose "infringing"marksare now,
suddenly,accessible from withinthe United States. Upholdinga claim of in-
e
fringementor dilutionlaunchedby the holderof a U.S.-registeredtrademark,
r
solely on the basis of a conflictingmarkon the Net, exposes that same trade-
a
markholderto claims from othercountrieswhen the use of their U.S.-regis-
Sh
teredmarkon the Web wouldallegedlyinfringea similarmarkin those foreign
jurisdictions.
2. Migrationof OtherRegulatedConductto the Net.

Almosteverythinginvolvingthe transferof informationcan be done online:
education,healthcare, banking,the provisionof intangibleservices,all forms
of publishing,andthe practiceof law. The laws regulatingmanyof theseactiv-
ities have developedas distinctlylocal andterritorial.Local authoritiescertify
27. See text accompanyingnote 11 supra.
28. Conflicts between domain names and registeredtrademarkshave caused Network Solutions,
Inc. (NSI), the agent for registrationof domain names in the United States, to requirethat registrants
"representand warrant"that they have the right to a requesteddomain name and promise to "defend,
indemnify and hold harmless"NSI for any claims stemming from use or registrationof the requested
name. Network Solution Inc., NSI Domain Name Dispute Policy Statement(Revision 01, effective No-
vember 23, 1995), available at ftp://rs.intemic.net/policy/interic/intemic-domain-4.txt.For a useful
overview of the domain name registrationsystem and of the tensions between trademarkrights and
domain names, see Gary W. Hamilton,Trademarkson the Internet:Confusion,Collusion or Dilution?,
4 TEX.INTELL.PROP.L.J. 1 (1995); see also Proceedings of the NSF/DNCEI & HarvardInformation
InfrastructureProject,InternetNames, Numbers,and Beyond: Issues in the Coordination,Privatization,
and Internationalizationof the Internet (Nov. 20, 1995), available at http://ksgwww.harvard.edu/iip/
nsfminl.html (discussing protectionof the "trademarkcommunity"on the Net).
teachers,charterbanks with authorized"branches,"and license doctors and

lawyers. The law has in essence presumedthat the activities conductedby
these regulatedpersonscannotbe performedwithoutbeing tied to a physical
body or buildingsubjectto regulationby the territorialsovereignauthority,and
thatthe effects of those activitiesare most distinctlyfelt in geographicallycir-
cumscribedareas. These distinctlylocal regulationscannotbe preservedonce
these activities are conductedby globally dispersedpartiesthroughthe Net.
Whenmanytradescan be practicedin a mannerthatis unrelatedto the physical
location of the participants,these local regulatorystructureswill eitherdelay
the developmentof the new mediumor, more likely, be supersededby new
structuresthat betterfit online phenomena.29
Any insistence on "reducing"all online transactionsto a legal analysis
basedin geographictermspresents,in effect, a new "mind-body" problemon a
global scale. We know that the activitiesthat have been
traditionally the sub-
of
ject regulation must still be engaged byin real people who are, after
distinctphysicallocations. But the interactionsof these people now somehow d
all, at
o
transcendthose physical locations. The Net enables forms of interactionin
_
whichthe shipmentof tangibleitemsacrossgeographicboundariesis irrelevant G
C
and in which the locationof the participantsdoes not matter. Effortsto deter-
mine "where"the eventsin questionoccuraredecidedlymisguided,if not alto-
getherfutile.
R
II.
o
A NEW BOUNDARY n FOR CYBERSPACE
r e d
Traditionallegal doctrinetreatsthe Net as a meretransmissionmediumthat
facilitatesthe exchangeof messagessentfromone legally significantgeograph-
a
ical locationto another,each of whichhas its own applicablelaws. But trying
Sh
to tie the laws of any particularterritorialsovereignto transactionson the Net,
or even tryingto analyzethe legal consequencesof Net-basedcommerceas if
each transactionoccurredgeographicallysomewherein particular,is most un-
satisfying. A more legally significant,and satisfying, border for the "law
space"of the Net consistsof the screensandpasswordsthatseparatethe tangi-
ble from the virtualworld.
A. Cyberspaceas a Place
Many of the jurisdictionaland substantivequandariesraised by border-
crossingelectroniccommunicationscould be resolvedby one simpleprinciple:
conceivingof Cyberspaceas a distinct"place"for purposesof legal analysisby
recognizing a legally significantborderbetween Cyberspaceand the "real
world." Using this new approach,we would no longer ask the unanswerable
question"where"in the geographicalworld a Net-basedtransactionoccurred.
Instead,the moresalientquestionsbecome: Whatproceduresarebest suitedto
the often uniquecharacteristicsof this new place and the expectationsof those
29. See David R. Johnson, The Internetvs. the Local Characterof the Law: The Electronic Web
Ties Iowa and New Yorkinto One Big System, LEGALTIMES,Dec. 5, 1994, at S32 (predicting the
"naturalselection of local regulatoryregimes that favor the Net").
who are engagedin variousactivitiesthere? Whatmechanismsexist or need to

be developedto determinethe contentof those rules and the mechanismsby
which they can enforced? Answersto these questionswill permitthe develop-
mentof rulesbettersuitedto the new phenomenain question,morelikely to be
made by those who understandand participatein those phenomena,and more
likely to be enforcedby means that the new global communicationsmedia
make availableand effective.
1. The New Boundaryis Real.

TreatingCyberspaceas a separate"space"to which distinct laws apply
should come naturally. There is a "placeness"to Cyberspacebecause the
messages accessed thereare persistentand accessibleto many people.30 Fur-
thermore,becauseentryinto this worldof storedonlinecommunicationsoccurs
througha screen and (usually)a passwordboundary,you know when you are
"there."No one accidentallystraysacrossthe borderinto Cyberspace.31To be
sure, Cyberspaceis not a homogenous.place; groups and activities found at
o d
various online locationspossess their own uniquecharacteristicsand distinc-
_
tions, and each areawill likely develop its own set of distinctrules.32But the G
R C
line thatseparatesonlinetransactionsfromourdealingsin the real worldis just
as distinct as the physical boundariesbetween our territorialgovernments-
perhapsmore so.
o n
Crossinginto Cyberspaceis a meaningfulact that would make application
of a distinct "law of Cyberspace"fair to those who pass over the electronic
r e d
boundary. As noted, a primaryfunction and characteristicof a border or
boundaryis its abilityto be perceivedby the one who crosses it.33 As regula-
a
tory structuresevolve to governCyberspace-based transactions,it will be much
Sh
30. Indeed, the persistenceand accessibility of electronic messages create such a sense of "place-
ness" that meetings in Cyberspacemay become a viable alternativeto meetings in physical space. See I.
TrotterHardy, Electronic Conferences: The Reportof an Experiment,6 HARV.J.L. & TECH.213, 232-
34 (1993) (discussing the advantagesof e-mail conferences). In contrast,there is no "Telespace"be-
cause the conversationswe conductby telephonedisappearwhen the partieshang up. Voicemail creates
an aural version of electronic mail, but it is not part of an interconnectedsystem that you can travel
through,by hypertext links or otherwise, to a range of public and semi-public locations.
31. See David R. Johnson,Travelingin Cyberspace,LEGAL TIMES,Apr. 3, 1995, at 26 (noting that
because an online user must usually go past a passwordand a warninglabel to access a newsgroup,it is
unlikely that person will accidentally be exposed to an offensive posing). Some informationproducts
combine a local CD-ROM with online access to provide updatedinformation. But even these products
typically provide some on-screen indication when the user is going online. Failure to provide notice
might well be deemed fraudulent,particularlyif the service imposes additionalcharges for use of the
online system. In any event, a productthat brings informationto the screen, from an online location,
without disclosing the online connectionto the user, has not createda legally significant"visit"to online
space. "Visiting"a space implies some knowledge that you are there.
32. See text accompanyingnotes 92-96 infra (discussinginternaldifferentiationamong rule-sets in
different online areas).
33. Having a noticeable bordermay be a prerequisiteto the establishmentof any legal regime that
can claim to be separatefrom pre-existingregimes. If someone acting in any given space has no warn-
ing that the rules have changed, the legitimacy of any attemptto enforce a distinctive system of law is
fatally weakened. No geographically-basedsovereign could plausibly claim to have jurisdiction over a
territorywith secret boundaries. And no self-regulatoryorganizationcould assert its prerogativeswhile
making it hardfor membersand nonmembersto tell each other apartor disguising when they are (or are
not) playing their membership-relatedroles.
easier to be certainwhich of those rules applyto your activitiesonline thanto

determinewhich territorial-based authoritymight apply its laws to your con-
duct. For example,you would know to abideby the "termsof service"estab-
lished by CompuServeor America Online when you are in their online
territory,ratherthan guess whetherGermany,or Tennessee,or the SEC will
succeed in assertingtheir right to regulateyour activities and those of the
"placeless"online personaewith whom you communicate.
The ultimatequestionof who shouldset the rulesfor uses of nameson the
Net presentsan apt microcosmfor examiningthe relationshipbetweenthe Net
and territorial-based legal systems. There is nothing more fundamental,le-
gally, thana nameor identity-the rightto legally recognizedpersonhoodis a
predicatefor the amassingof capital,includingthe reputationaland financial
o
capital,that arises from sustainedinteractions.The domainname system, and
other online uses of names and symbols tied to reputationsand virtualloca-d
_ G
tions, exist operationallyonly on the Net. These names can, of course, be
printedon paperor embodiedin physicalform and shippedacrossgeographic
R C
borders. But such physicaluses shouldbe distinguishedfromelectronicuse of
such namesin Cyberspace,becausepublishinga nameor symbolon the Net is
o n
not the same as intentionaldistributionto any particularjurisdiction. Instead,
use of a name or symbol on the Net is like distributionto all jurisdictions
simultaneously. Recall that the non-country-specificdomain names like
e d
".com"and ".edu"lead to the establishmentof online addresseson a global
r
basis. And throughsuch widespreaduse, the globaldomainnamesgainedpro-
a
prietaryvalue. In this context,assertionby any localjurisdictionof the rightto
Sh
set the rules applicableto the "domainname space"is an illegitimateextra-
territorialpower grab.
Conceivingof the Net as a separateplace for purposesof legal analysiswill
have greatsimplifyingeffects. Forexample,a globalregistrationsystemfor all
domain names and reputationallysignificantnames and symbols used on the
Net would become possible. Such a Net-basedregime could take accountof
the specialclaimsof ownersof strongglobalmarks(as used on physicalgoods)
and "grandfather" these owners' rightsto the use of their strongmarksin the
newly opened online territory. But a Net-based global registrationsystem
could also fully accountfor the true natureof the Net by treatingthe use of
markson Web pages as a global phenomena,by assessing the likelihood of
confusionanddilutionin the onlinecontext,andby harmonizingany ruleswith
applicableengineeringcriteria,such as optimizingthe overall size of the do-
main name space.
A distinctset of rulesapplicableto trademarks in Cyberspacewouldgreatly
simplify mattersby providinga basis to resist the inconsistentand conflicting
assertionsof geographicallylocal prerogatives.If one countryobjects to the
use of a markon the Web that conflicts with a locally registeredmark,the
rebuttalwould be thatthe markhas not been used inside the countryat all, but
only on the Web. If a companywants to know where to registerits use of a

symbolon the Net, or to check for conflictingprioruses of its mark,the answer
will be obviousandcost effective: the designatedregistrationauthorityfor the
relevantportionof the Net itself. If we need to develop rulesgoverningaban-
donment,dilution,and conditionson uses of particulartypes of domainnames
and addresses,those rules-applicable specifically to Cyberspace-will be
able to reflectthe special characteristicsof this new electronicmedium.34
B. Other CyberspaceRegimes
Once we take Cyberspaceseriouslyas a distinctplace for purposesof legal
analysis,manyopportunitiesto clarifyand simplifythe rules applicableto on-
line transactionsbecome available.
1. DefamationLaw.
Treatingmessages on the Net as transmissionsfrom one place to another
o d
has created a quandaryfor those concernedabout liability for defamation:
_
Messages may be transmittedbetweencountrieswith very differentlaws, and G
liabilitymay be imposedon the basis of "publication"
C
in multiplejurisdictions
with varyingstandards.35In contrast,the approachthat treatsthe global net-
R
work as a separateplace would considerany allegedlydefamatorymessage to
o n
have been publishedonly "on the Net" (or in some distinct subsidiaryarea
thereof)-at least until such time as distributionon paperoccurs.36This re-
characterization
r e d
makesmoresense. A personwho uploadsa potentiallydefam-
atory statementwould be more able to determinethe rules applicableto his
own actions. Moreover,becausethe Net has distinctcharacteristics,including
a
an enhancedabilityof the allegedlydefamedpersonto reply,the rulesof defa-
Sh
mationdevelopedfor the Net could take into accountthese technologicalcapa-
34. For example, we will have to take into accountthe desire of participantsin online communica-
tions for pseudonymity. This will affect the extent to which informationabout the applicant's identity
must be disclosed in orderto obtain a valid addressregistration. See A. Michael Froomkin,Anonymity
and Its Enmities, 1995 J. of Online Law art.4, available at http://www.law.cornell.edu/jol/jol.table.html
(discussing the mechanics of anonymityand how it affects the creationof pseudonymouspersonalities
and communicationon the Net); A. Michael Froomkin,Flood Controlon the InformationOcean: Living
WithAnonymity,Digital Cash, and DistributedDatabases - U. PTTr. J.L. COM.,available at http://
www.law.miami.edu/froomkin(forthcoming 1996) (exploring the use and possible regulation of com-
puter-aidedanonymity);David G. Post, Pooling Intellectual Capital: Thoughtson Anonymity,Pseudo-
nymity, and Limited Liability in Cyberspace, U. Chi. Legal Forum (forthcoming),available at http://
www-law.lib.uchicago.edu/forum/(discussing the value of pseudonymouscommunications). And any
registrationand conflict-resolutionscheme will have to take into account the particularways in which
Internetaddresses and names are viewed in the marketplace. If shorternames are valued more highly
(jones.com being more valuable than jones isp.members.directory.com),this new form of "domain
envy" should be considered in developing applicablepolicy.
35. See Michael Smyth and Nick Braithwaite,First U.K.Bulletin Board DefamationSuit Brought,
NAT'L L.J., Sept. 19, 1994, at C10 (noting that English courts may be a more attractive forum for
plaintiffs charging defamationin cyberspace).
36. Subsequentdistributionof printedversions might be characterizedas publication,without un-
derminingthe benefits of this new doctrine,because it would much easier to determinewho has taken
such action and where (in physical space) it occurred,and the partywho engages in physical distribution
of defamatoryworks has much clearer warningregardingthe natureof the act and the applicabilityof a
particularterritorialstate's laws.
bilities-perhaps by requiringthatthe opportunityfor replybe takenadvantage

of in lieu of monetarycompensation.37The distinctcharacteristicsof the Net
could also be takeninto accountwhen applyingand adaptingthe "publicfig-
ure"doctrinein a contextthatis bothglobalandhighly compartmentalized and
that blursthe distinctionbetweenprivateand public spaces.
2. Regulationof Net-BasedProfessionalActivities.
The simplifyingeffect of "takingCyberspaceseriously"likewise arises in
the context of regimes for regulatingprofessionalactivities. As noted, tradi-
tional regulationinsists that each professionalbe licensed by every territorial
jurisdictionwhereshe providesservices.38This requirementis infeasiblewhen
professionalsdispenseservicesoverthe Net andpotentiallyprovidedin numer-
ous jurisdictions.Establishingcertificationregimesthatapplyonly to such ac-
tivities on the Net wouldgreatlysimplifymatters.Suchregulationswouldtake
into accountthe special featuresof Net-basedprofessionalactivitieslike tele-
medicine or global law practice. For example,they would take into account
o d
special risks caused by giving online medical advice in the absence of direct
_
physicalcontactwith a patientor by answeringa questionregardinggeographi- G
C
cally local law from a remotelocation.39Using this new approach,we could
overridethe effortsof local school boardsto license online educationalinstitu-
R
tions, treatingattendanceby studentsat onlineinstitutionsas a formof "leaving
home for school"ratherthancharacterizing
prosecutable distributionof
o
disfavored n
the offeringof educationonline as
materialsinto a potentiallyunwelcom-
ing community that
r
asserts
e
3. Fraud and Antitrust.
local
dlicensingauthority.
a
Sh
Even an examplethat mightotherwisebe thoughtto favorthe assertionof
jurisdictionby a local sovereign-protection of local citizens from fraudand
antitrustviolations-shows the beneficialeffects of a Cyberspacelegal regime.
How should we analyze "markets"for antitrustand consumerprotectionpur-
poses when the companiesat issue do businessonly throughthe WorldWide
Web? Cyberspacecould be treatedas a distinctmarketplacefor purposesof
assessing concentrationand marketpower. Concentrationin geographicmar-
kets wouldonly be relevantin the rarecases in whichsuch marketpowercould
be inappropriately leveragedto obtainpower in online markets-for example
37. Edward A. Cavazos, ComputerBulletin Board Systems and the Right of Reply: Redefining
Defamation Liabilityfor a New Technology, 12 REV.LITIG.231, 243-47 (1992). This "rightof reply"
doctrine might apply differently to differentareas of the Net, depending on whether these areas do in
fact offer a meaningful opportunityto respond to defamatorymessages.
38. Early efforts to avoid this result in the "telemedicine"seem to take the form of allowing
doctors to interactwith other doctors in consultations,requiringcompliance with local regulationsonly
when the doctor deals directly with a patient. See Howard J. Young & Robert J. Waters, Licensure
Barriers to the Interstate Use of Telemedicine(1995), available at http://www.arentfox.com/newslett/
telelb.htm. The regulationof lawyers is muddled: Regulationsare sometimes based on the location of
the lawyer's office (as in the case of Texas' regulationof advertising),sometimes based on the content
of legal advice, and sometimes based on the natureand location of the client.
39. Indeed, practicingthe "law of the Net" itself presumablyrequiresqualificationsunrelatedto
those imposed by local bars.
by conditioning access to the Net by local citizens on their buying services

from the same company (such as a phone company) online. Claims regarding a
right to access to particular online services, as distinct from claims to access
particular physical pipelines, would remain tenuous as long as it is possible to
create a new online service instantly in any corer of an expanding online
space.40
Consumer protection doctrines could also develop differently online-to
take into account the fact that anyone reading an online ad is only a mouse
click away from guidance from consumer protection agencies and discussions
with other consumers. Can Minnesota prohibit the establishment of a Ponzi
scheme on a Web page physically based in the Cayman islands but accessed by
Minnesota citizens through the Net? Under the proposed new approach to reg-
ulation of online activities, the answer is clearly no. Minnesota has no special
right to prohibit such activities. The state lacks enforcement power, cannot
show specially targeted effects, and does not speak for the community with the
most legitimate claim to self-governance. But that does not mean that fraud
o d
might not be made "illegal" in at least large areas of Cyberspace. Those who
_
establish and use online systems have a interest in preserving the safety of their
G
C
electronic territory and preventing crime. They are more likely to be able to
enforce their own rules. And, as more fully discussed below, insofar as a con-
n R
sensually based "law of the Net" needs to obtain respect and deference from
local sovereigns, new Net-based law-making institutions have an incentive to
governments.
d o
avoid fostering activities that threaten the vital interests of territorial
4.
r
Copyright Law.
a e
Sh
We suggest, not without some trepidation, that "taking Cyberspace seri-
ously" could clarify the current intense debate about how to apply copyright
law principles in the digital age. In the absence of global agreement on appli-
cable copyright principles, the jurisdictional problems inherent in any attempt
to apply territorially based copyright regimes to electronic works simultane-
ously available everywhere around the globe are profound. As Jane Ginsburg
has noted:
A key featureof the GII [GlobalInformationInfrastructure]is its abilityto
renderworksof authorshippervasivelyandsimultaneouslyaccessiblethrough-
out the world. The principleof territoriality
becomesproblematicif it means
that posting a work on the GII calls into play the laws of every countryin
whichthe workmaybe receivedwhen ... these laws may differsubstantively.
Should the rights in a work be determinedby a multiplicityof inconsistent
legal regimes when the work is simultaneouslycommunicatedto scores of
countries? Simply takinginto accountone country'slaws, the complexityof
placing works in a digital networkis alreadydaunting: should the task be
furtherburdenedby an obligationto assess the impactof the laws of every
40. In this, as in other matters, it is critical to distinguish the different layers of the "protocol
stack." It may be possible to establish power with regardto physical connections. It is much harderto
do so with respect to the logical connections that exist at the "applications"layer.
countrywherethe workmightbe received? Putmorebluntly,for workson the

GII, therewill be no physicalterritoriality
.... Withoutphysicalterritoriality,
can legal territorialitypersist?41
But treating Cyberspace as a distinct place for purposes of legal analysis does
more than resolve the conflicting claims of different jurisdictions: It also al-
lows the development of new doctrines that take into account the special char-
acteristics of the online "place."
The basic justification for copyright protection is that bestowing an exclu-
sive property right to control the reproduction and distribution of works on
authors will increase the supply of such works by offering authors a financial
incentive to engage in the effort required for their creation.42 But even in the
"real world," much creative expression is entirely independent of this incentive
structure, because the author's primary reward has more to do with acceptance
in a community and the accumulation of reputationalcapital through wide dis-
seminationthan it does with the licensing and sale of individualcopies of
works.43 And that may be more generallytrue of authorshipin Cyberspace.
o d
Because authorscan now, for the firsttime in history,deliver copies of their
_
creationsinstantaneouslyand at virtuallyno cost anywherein the world, one
G
C
mightexpect authorsto devise new modesof operationthattake advantageof,
ratherthanworkcounterto, this fundamentalcharacteristicof the new environ-
R
ment.44 One such strategyhas alreadybegun to emerge: giving away infor-
n
mationat no charge-what might be called the "Netscapestrategy"45-as a
o
d
41. Jane C. Ginsburg,Global Use/TerritorialRights: Private InternationalLaw Questions of the
e
Global InformationInfrastructure,42 J. COPYRIGHT
omitted).
r
Soc'Y U.S.A. 318, 319-320 (1995) (footnotes
a
42. See generally William Landes & RichardPosner,An EconomicAnalysis of CopyrightLaw, 18
Sh
J. LEG.STUD.325 (1989) (examining the extent to which copyrightlaw supportsefficient allocation of
resources).
43. For example, the creative output of lawyers and law professors-law review articles, briefs
and other pleadings, and the like-may well be determinedlargely by factors completely unrelatedto
the availability of copyright protectionfor those works. That category of authors,generally speaking,
obtains reputationalbenefits from wide disseminationthat far outweigh the benefits that could be ob-
tained from licensing individual copies. For an analysis of the incentive structurein the publishing
market, see Stephen Breyer, The Uneasy Case for Copyright:A Study of Copyright in Books, Photo-
copies, and ComputerPrograms, 84 HARV.L. REV.281, 293-309 (1970); see also HowardP. Tuckman
& Jack Leahey, What is an Article Worth?, 83 J. POL.ECON.951 (1975) (suggesting a method for
calculating the monetaryvalue of an academic article).
44. There is a large and diverse literatureon the new kinds of authorshipthat are likely to emerge
in cyberspace as a function of the medium's interactivenature,the ease with which digital information
can be manipulated,and new searchingand linking capabilities. Among the more insightful pieces in
this vein are KATSH,LAWINA DIGITAL WORLD, supra note 10, at 92-113, 195-236; SHERRY TURKLE,
THESECOND SELF:COMPUTERS ANDTHEHUMANSPIRIT (1984); Pamela Samuelson,Digital Media and
the Changing Face of Intellectual Property Law, 16 RUTGERS COMPUTER & TECH.L.J. 323 (1990);
Eugene Volokh, Cheap Speech, 104 YALEL.J. 1805 (1994).
45. Netscape Corporationgave away, at no charge,over four million copies of theirWeb browser;
it is estimatedthat they now controlover 70% of the Web browsermarket,which they have managedto
leverage into dominancein the Web server software market,sufficient to enable them to launch one of
the most successful Initial Public Offering in the history of the United States. See Beppi Crosario,
Netscape IPO booted up: Debut of Hot Stock Stuns Wall Street Veterans, BOSTON GLOBE,Aug. 10,
1995, at 37; LaurenceZuckerman,WithInternetCachet, Not Profit,A New Stock Is Wall St. 's Darling,
N.Y. TIMES,Aug. 10, 1995, at 1. Other companies are following Netscape's lead; for example,
RealAudio, Inc. is distributingsoftware designed to allow Web browsersto play sound files in real time
means of building up reputational capital that can subsequently be converted

into income (for example, by means of the sale of services). As Esther Dyson
has written:
Controllingcopies (once createdby the authoror by a thirdparty)becomes
a complex challenge.You can eithercontrolsomethingvery tightly, limiting
distributionto a small, trustedgroup,or you can rest assuredthateventually
your productwill findits way to a largenonpayingaudience-if anyonecares
to have it in the firstplace .... The trickis to controlnot the copies of your
workbut insteada relationshipwith the customers-subscriptionsor member-
ship. And that's often what the customerswant, because they see it as an
assuranceof a continuingsupplyof reliable,timely content.
Much chargeablevalue will be in certificationof authenticityand reliabil-
ity, not in the content. Brandname,identity,andothermarksof value will be
important;so will securityof supply. Customerswill pay for a streamof infor-
d
mationand contentfrom a trustedsource. For example,the umbrellaof The
o
New YorkTimessanctifiesthe wordsof its reporters.The contentchurnedout
by Timesreportersis valuablebecausethe reportersundergoquality-control,
and becauseothersbelieve them.46
_ G
A profound shift of this kind in regard to authorialincentives fundamentally
R C
alters the applicable balance between the costs and benefits of copyright protec-
tion in Cyberspace, calling for a reappraisalof long-standing principles.47 So,
o n
too, do other unique characteristics of Cyberspace severely challenge tradi-
tional copyright concepts.48 The very ubiquity of file "copying"-the fact that
one cannot access any information whatsoever in a computer-mediated envi-
r e d
ronment without making a "copy" of that information49-implies that any sim-
ple-minded attempt to map traditional notions of "copying" onto Cyberspace
a
Sh
overthe Internet,presumably
in the hopesof similarlyestablishing
a dominantmarketpositionin the
servermarket.See http://www.realaudio.com.
46. Esther Dyson, Intellectual Value, WIRED,July 1995, at 138-39, 183.
47. DavidG. Post,WhoOwnsthe CopyRight?Opportunities andOpportunismon the Global
Network2-3 (Oct.29, 1995)(unpublished on file withthe StanfordLawReview).
manuscript,
48. See Jane C. Ginsburg,Putting Cars on the "InformationSuperhighway":Authors,Exploiters,
and Copyrightin Cyberspace,95 COLUM. L. REV.1466, 1488 (1995) (concludingthat it is very difficult
forauthorsto "discoverandcombatinfringements" of theirworksin Cyberspace); DavidG. Post,New
Wine,OldBottles:TheEvanescent Copy, AM.LAW., May1995,at 103(discussingthechoicesthatlegal
authoritiesface in developingcopyrightlaw in Cyberspace) New Wine].
[hereinafter
49. It is virtuallyimpossibleto browsethe Net withoutcopying:
"Browsing" on theWorldWideWeb,forexample,necessarily involvesthecreationof numer-
ous "copies"of information.First,a messageis transmitted fromComputerA to (remote)
ComputerB, requestingthatComputer B senda copy of a particularfile (for example,the
"homepage"storedon Computer B) backto Computer A. Whentherequestis receivedby
Computer B, a copyof therequested file is madeandtransmitted backto Computer A (where
it is copied again-"loaded"into memory-and displayed).And the mannerin which
messagestravelacrosstheInternet to reachtheirintendedrecipient(s)-viaintermediary com-
putersknownas "routers," at eachof whichthemessageis "read" by meansof "copying" the
message into the computer's memory-[involve] . . . innumerable separate acts of ...
"reproduction."
File copyingis not merelyinexpensivein cyberspace,it is ubiquitous.And it is not
merely ubiquitous,it is indispensable....
Thus,if you equippedyourcomputerwith a "copylock"-an imaginarydevice that
wouldpreventthereproductionof anyandall information
nowstoredin thecomputerin any
form-the computeressentiallywouldstopfunctioning.
transactionswill have perverseresults.50Applicationof the "firstsale" doc-

trine(allowingthe purchaserof a copyrightedworkto freelyresellthe copy she
purchased)is problematicwhen the transferof a lawfully owned copy techni-
cally involves the makingof a new copy beforethe old one is eliminated,51as
is defining"fairuse" when a work's size is indeterminate,rangingfrom (1) an
individualparagraphsold separatelyon demandin responseto searchesto (2)
the entiredatabasefrom whichthe paragraphoriginates,somethingnever sold
as a whole unit.52
TreatingCyberspaceas a distinctlocation allows for the developmentof
new forms of intellectualpropertylaw, applicableonly on the Net, that would
properlyfocus attentionon these unique characteristicsof this new, distinct
place while preservingdoctrinesthatapplyto worksembodiedin physicalcol-
lections (like books) or displayedin legally significantphysical places (like
theaters). Currentdebatesabout applyingcopyrightlaw to the Net often do,
implicitly,treatit as a distinctspace, at least insofaras commercialcopyright
ownerssomewhatinaccuratelyreferto it as a "lawless"place.53The civility of
the debatemight improveif everyoneassumedthe Net shouldhave an appro-
o d
_
priately differentlaw, including a special law for unauthorizedtransfersof
works from one realm to the other. We could, in other words, regulatethe G
R C
smugglingof workscreatedin the physicalworldby treatingthe unauthorized
uploadingof a copy of such worksto the Net as infringement.This new ap-
o n
proachwould help promotersof electroniccommercefocus on developingin-
centive-producingrules to encourageauthorizedtransfersinto Cyberspaceof
works not availablenow, while also reassuringowners of existing copyrights
e d
thatchangesin the copyrightlaw for the Net would not requirechanginglaws
r
applicableto distributingphysicalworks. It wouldalso permitthe development
a
of new doctrinesof impliedlicense and fair use that, as to worksfirstcreated
Sh
on the Net or importedwith the author'spermission,appropriatelyallow the
David Post, Leaping Before Looking:Proposals WouldMake UnsettlingChanges, LEGAL TIMES,Apr. 8,

1996, (Special Report), at 39, 44.
50. See Jessica Litman, The Exclusive Right to Read, 13 CARDOZO ARTS& ENT.L.J. 29, 40-42
(noting that undera view that "one reproducesa work every time one reads it into a computer'srandom
access memory . . . any act of readingor viewing [a digital] work would requirethe use of a computer
and would, underthis interpretation,involve an actionablereproduction");New Wine,supra note 48, at
104 ("If the very act of getting a document to your screen is consideredthe 'making of a copy' within
the meaning of the CopyrightAct, then a high proportionof the millions of messages travelingover the
Interneteach day potentially infringes on the right of some file creator ... to control the making of
copies."); Pamela Samuelson, The CopyrightGrab, WIRED,Jan. 1996, at 137 (same); Pamela Samuel-
son, Legally Speaking:IntellectualPropertyRights and the Global InformationEconomy,39 COMMUN.
A.C.M. 23, 24 (1996) [hereinafterLEGALLY SPEAKING](describing the view that browsing of digital
works is infringingif "temporarycopying" must occur "in a computer'smemory to enable users to read
documents").
51. Neel Chatterjee,ImperishableIntellectualCreations: The Limitsof the First Sale Doctrine, 5
FORDHAM INTELL. PROP.MEDIA& ENT.L.J. 383, 416-19 (1995) (discussing InformationInfrastructure
Task Force proposal to exclude transmissionsfrom the first sale doctrine).
52. See, e.g., Telerate Sys. v. Caro,689 F. Supp. 221, 228-30 (S.D.N.Y. 1988) (finding that copy-
ing a "few pages" of a 20,000 page databasewas substantialenough to weigh against fair use).
53. See, e.g., BenjaminWittes, A (Nearly) Lawless Frontier: The Rapid Pace of Change in 1994
Left the Law Chasing Technologyon the InformationSuperhighway,THERECORDER, Jan. 3, 1995, at 1.
May 1996] RISEOF LAWIN CYBERSPACE !387
transmissionand copying necessaryto facilitatetheiruse withinthe electronic

realm.54
III. WILLRESPONSIBLE
SELF-REGULATORY ON THE
EMERGE
STRUCTURES
NET?
Even if we agree that new rules shouldapply to online phenomena,ques-

tions remainaboutwho sets the rules and how they are enforced. We believe
the Net can develop its own effective legal institutions.
In orderfor the domainnamespaceto be administeredby a legal authority
thatis not territoriallybased,new law-makinginstitutionswill have to develop.
Manyquestionsthatarisein settingup this systemwill need answers: Shoulda
new top level domainbe created?55Do online addressesbelong to users or
service providers?Does one name impermissiblyinterferewith another,thus
confusing the public and dilutingthe value of the pre-existingname?56The
o d
G
new system must also includeproceduresto give notice in conflictingclaims,
to resolvethese claims,andto assess appropriate
_
remedies(including,possibly,
compensation)in cases of wrongfuluse. If the Cyberspaceequivalentof emi-
C
nentdomaindevelops,questionsmay ariseover how to compensateindividuals
n R
when certaindomainnamesaredestroyedor redeployedfor the publicgood of
the Net community.57Someonemustalso decidethresholdmembershipissues
d o
for Cyberspacecitizens, including how much users must disclose (and to
whom) about their real-worldidentitiesto use e-mail addressesand domain
e
namesfor commercialpurposes. Impliedthroughoutthis discussionis the rec-
r
ognitionthatthese ruleswill be meaningfulandenforceableonly if Cyberspace
a
citizens view whoevermakesthese decisions as a legitimategoverningbody.
Sh
54. For example, we could adopt rules that make the "caching"of web pages presumptivelyper-
missible, absent an explicit agreement,ratherthan adopting the standardcopyrightdoctrine. (Caching
involves copying Web pages to a hard drive so that futuretrips to the site take less time to complete).
Because making "cached"copies in computermemoryis essential to speed up the operationof the Web,
and because respectingexpress limits or retractionson any implied license allowing caching would clog
up the free flow of information,we should adopt a rule favoring browsing. See CYBERSPACE LAW
INSTITUTE,CopyrightLaw on the Internet:The Special Problem of Caching and CopyrightProtection
(Sept. 1, 1995), available at http://www.II.georgetown.edu:80/cli.html(arguing for such an approach);
New Wine,supra note 47 (proposinga new rule for caching Web pages); Samuelson, Legally Speaking,
supra note 50, at 26-27 (discussing copyrightissues raised by file caching).
55. See text accompanyingnote 11 supra for an explanationof the domain name system.
56. This dangerof confusion exists whetherthe name conflicts with "realworld"trademarkuses
or only other online uses. To be sure, whoever decides these questions must consider the views of
geographically based authoritieswhen online names interferewith the existing trademarksof physical
goods. But they must also decide ownership questions about online identities with addresses, names,
and logos having no applicationoffline. The views of territoriallybased authoritieswould appear to
have less bearing in this context.
57. Newly discoveredpublic needs, such as using a particulardomainor eliminatingit to establish
a new system, could interfere with "investmentbacked expectations." To keep geographically based
trademarkauthoritiesat bay, Net authoritiesmay need a responsible "foreignpolicy" to ward off over-
regulation by local sovereigns, such as "grandfatheringin" strong global trademarksand preventing
those who acquired certain domain names on a "first-come, first-served"basis from engaging in
holdups.
Experiencesuggeststhatthe communityof onlineusersand serviceprovid-

ers is up to the task of developinga self-governancesystem.58For example,
the currentdomain name system evolved from decisions made by engineers
and the practicesof Internetservice providers.59Now thattrademarkowners
are threateningthe companythatadministersthe registrationsystem,the same
engineerswho establishedthe originaldomainnamestandardsare againdelib-
eratingwhetherto alterthe domainname system to take these new policy is-
sues into account.60
Every system operatorwho dispenses a passwordimposes at least some
requirementsas conditionsof continuingaccess, includingpayingbills on time
or remaininga memberof a groupentitledto access (for example,studentsat a
university).61System operators(sysops) have an extremelypowerfulenforce-
ment tool at their disposal to enforce such rules-banishment.62 Moreover,
communitiesof usershave marshaledplentyof enforcementweaponsto induce
wrongdoersto comply with local conventions,such as rules againstflaming,63
shunning,64mailbombs,65and more. And both sysops and users have begun
o d
explicitly to recognizethat formulatingand enforcingsuch rules should be a
_
matterfor principleddiscussion,not an act of will by whoeverhas controlof
the power switch.66 G
R C
While many of these new rules and customs apply only to specific, local
areasof the global network,some standardsapplythroughtechnicalprotocols
n
on a nearly universalbasis. And widespreadagreementalreadyexists about
o
1995J. ONLINE
d
58. See David G. Post, Anarchy,State, and the Internet:An Essay on Law-Makingin Cyberspace,
e
L. art.3, par.7-8, availableat http://www.law.corell.edu/joVjol.table.html.
r
59. See A. M. Rutkowski,InternetNames,Numbersand Beyond:Issuesin the Coordination,
Privatization,
a
andInternationalization of the Internet(Nov.20, 1995)(unpublished
manuscript,on file
Sh
withthe StanfordLawReview)(identifying issuesassociatedwiththeadministration
of Internetnames
andnumbers).
60. David W. Maher, Trademarkson the Internet:Who's in Charge?, (1996) available at http://
www.aldea.com/cix/maher.html(arguingthattrademark ownershavea stakein the Net thatmustbe
takenintoaccount).
61. Otherrulesrequirerefrainingfromactionsthatthreatenthe valueof the onlinespaceor in-
creasethe riskthatthesystemoperatorwill face legaltroublein therealworld. Manycoherentonline
communitiesalso haverulesthat:preservethe specialcharacter of theironlinespaces;governposted
messages;discourage"flaming"(sendingan insultingmessage)or "spamming" (sendingthe same
messageto multiplenewsgroups);andmandatecertainprofessional for participants.
qualifications
62. See Robert L. Dunne, Deterring UnauthorizedAccess to Computers:ControllingBehavior in
Cyberspace Through a Contract Law Paradigm, 35 JURIMETRICS J. 1, 12-14 (1994) (suggesting that
systemoperatoragreements to banishoffenderswoulddeterunauthorized
computeraccessmoreeffec-
tivelythancurrentcriminalsanctions).
63. See John Seabrook,My First Flame, NEWYORKER,June 16, 1994, at 70 (describingthe online
phenomenon of flaming,wherea userloses "selfcontrolandwrite[s]a messagethatuses derogatory,
obscene,or inappropriatelanguage").
64. A computeruser"shuns"anotherby refusingto receivemessagesfromthatperson(or,more
generally,by employinga softwareprogramknownas a "killfile"to automatically deflectanye-mail
messagesfroma specifiedaddress).
65. Computerusers"mailbomb" a victimby sendinga largenumberof junk electronicmail
messageswiththegoalof overloading thereceivingcomputer, or at leastinconveniencing thereceiver.
66. JenniferMnookin,Virtual(ly) Law:A CaseStudyof theEmergence of Lawon LambdaMOO
(May 15, 1995)(unpublished manuscript,on file withtheStanfordLawReview)(describing the emer-
genceof a legalsystemin theLambdaMOO virtualcommunity, "aninteractive, real-timeconferencing
programbasedin physicalspatialmetaphors").
core principles of "netiquette"in mailing lists and discussion groups67-

although,admittedly,new users have a slow learningcurve and the Net offers
little formal"publiceducation"regardingapplicablenorms.68Moreover,dis-
puteresolutionmechanismssuitedto this new environmentalso seem certainto
prosper.69Cyberspaceis anythingbutanarchic;its distinctrulesets arebecom-
ing more robustevery day.
Perhapsthe most apt analogyto the rise of a separatelaw of Cyberspaceis
the originof the Law Merchant-a distinctset of rulesthatdevelopedwith the
new, rapidboundary-crossing tradeof the MiddleAges.70 Merchantscould not
resolve theirdisputesby takingthemto the local noble, whose establishedfeu-
dal law mainlyconcernedlandclaims. Nor couldthe local lordeasily establish
meaningfulrulesfor a sphereof activitythathe barelyunderstoodandthatwas
executedin locationsbeyondhis control. The resultof this jurisdictionalcon-
fusion was the developmentof a new legal system-Lex Mercatoria.71The
o d
67. Joanne Goode and Maggie Johnson, Putting Out the Flames: The Etiquette and Law of E-
G
Mail, ONLINE, Nov. 1991, at 61 (suggesting guidelines for using electronic mail and networking);S.
Hambridge,Netiquette Guidelines (Oct. 1995), available at ftp://ds.internic.net/rfc/rfcl855.txt(same).
(discussing how new users learn "netiquette").
C _
68. See James Barron,It's Time to Mind your E-Manners,N.Y. TIMES,Jan. 11, 1995, at Cl, C6
69. See I. TrotterHardy, The Proper Legal Regimefor "Cyberspace,"55 U. PITT.L. REV.993,
R
1051-1053 (1994) (suggesting that Cyberspaceusers should form their own "virtualcourts"for interna-
tional torts); Henry H. Perritt,Jr., Dispute Resolutionin Electronic NetworkCommunities,38 VILL.L.
n
REv. 349, 398-400 (1993) (proposing an alternativedispute resolution mechanism for tort claims that
d o
could be implementedby a computernetwork service provider);Henry H. Perritt,Jr., President Clin-
ton's National InformationInfrastructureInitiative: CommunityRegained?, 69 CHI.-KENT L. REV.991,
1011-16 (1994) (advocatingthe use of new informationtechnology to facilitatedispute resolution). One
r
vmag.law.vill.edu:8080.
a e
such dispute resolution service, the "VirtualMagistrate,"has already arisen on the Net. See http://
70. See LEONE. TRAKMAN, THELAWMERCHANT: THEEVOLUTION OFCOMMERCIAL LAW11-12
Sh
(1983) (Law Merchantwas " 'a system of law that did not rest exclusively on the institutionsand local
customs of any particularcountry,but consisted of certainprinciplesof equity and usages of tradewhich
general convenience and a common sense of justice have established to regulate the dealings of
merchants and mariners in all the commercial countries of the civilized world' ") (quoting Bank of
Conway v. Starry,200 N.W. 505, 508 (N.D. 1924) (alterationsomitted); Hardy,supra note 69, at 1020
(Law Merchant was "simply an enforceable set of customary practices that inured to the benefit of
merchants,and that was reasonablyuniformacross all the jurisdictionsinvolved in the [medieval] trade
fairs");Perritt,supra note 9, at 48 ("[U]ntilthe seventeenthcentury,the law merchantwas an independ-
ent legal system with its own normativerules, its own institutions,and its own coercive measures.").
Bruce Benson describes the development of the Law Merchantas follows:
With the fall of the Roman Empire,commercialactivities in Europewere almost nonexistent
relative to what had occurredbefore and what would come after. Things began to change in
the eleventh and twelfth centuries [with the] emergence of a class of professional merchants.
There were significant barriersto overcome before substantialinterregionaland international
tradecould develop, however. Merchantsspoke differentlanguagesand had differentcultural
backgrounds. Beyond that, geographicdistances frequentlypreventeddirect communication,
let alone the building of strong interpersonalbonds that would facilitate trust. Numerous
middlemen were often requiredto bring about an exchange .... All of this, in the face of
localized, often contradictorylaws and business practices,producedhostility towards foreign
commercial customs and led to mercantileconfrontations. There was a clear need for Law as
a "languageof interaction."
Bruce L. Benson, The SpontaneousEvolution of CommercialLaw, 55 SouthernEcon. J. 644, 646-47
(1989).
71. Benson describes the development of the Law Merchant:
[D]uring this period, because of the need for uniform laws of commerce to facilitate interna-
tional trade,"the basic concepts and institutionsof modem Westernmercantilelaw-lex mer-
people who cared most aboutand best understoodtheir new creationformed

and championedthis new law, which did not destroyor replaceexisting law
regardingmore territoriallybased transactions(e.g., transferringland owner-
ship). Arguably,exactlythe sametype of phenomenonis developingin Cyber-
space rightnow.72
Governmentscannot stop electroniccommunicationsfrom coming across
theirborders,even if they wantto do so. Nor can they crediblyclaim a rightto
regulatethe Net basedon supposedlocal harmscausedby activitiesthatorigi-
nate outside their bordersand that travelelectronicallyto many differentna-
tions. One nation's legal institutionsshouldnot monopolizerule-makingfor
the entire Net. Even so, establishedauthoritieswill likely continueto claim
that they must analyze and regulatethe new online phenomenain terms of
some physical locations. After all, they argue,the people engaged in online
communicationsstill inhabitthe materialworld,andlocal legal authoritiesmust
have authorityto remedythe problemscreatedin the physicalworldby those
acting on the Net. The rise of responsiblelaw-makinginstitutionswithin
o d
Cyberspace,however,will weigh heavily againstargumentsthat describethe
_
Net as "lawless"and thus connectregulationof online tradeto physicaljuris- G
R C
dictions. As noted,sysops,actingaloneor collectively,have the powerto ban-
ish those who commit wrongfulacts online.73Thus, for online activitiesthat
o n
catoria .. .-were formed, and, even more important,it was then that mercantilelaw in the
West first came to be viewed as an integrated,developing system, a body of law." Virtually
d
every aspect of commercial transactionsin all of Europe(and in cases even outside Europe)
e
were "governed"by this body of law after the eleventh century.... This body of law was
r
voluntarilyproduced,voluntarilyadjudicatedand voluntarilyenforced. In fact, it had to be.
a
There was no other potential source of such law, including state coercion.
Sh
Id. at 647 (quoting HAROLD J. BERMAN, LAWANDREVOLUTION: THEFORMATION OFWESTERN LEGAL
TRADITION 333 (1983).
72. I. TrotterHardy strongly supportsthis view:
The parallels [between the development of the Law Merchantand] cyberspace are strong.
Many people interactfrequentlyover networks,but not always with the same people each time
so that advance contractualrelations are not always practical. Commercialtransactionswill
more and more take place in cyberspace, and more and more those transactionswill cross
national boundariesand implicate differentbodies of law. Speedy resolutionof disputes will
be as desirable as it was in the Middle Ages! The means of an informalcourt system are in
place in the form of on-line discussion groups and electronic mail. A "Law Cyberspace"co-
existing with existing laws would be an eminently practical and efficient way of handling
commerce in the networkedworld.
Hardy, supra note 69, at 1021; see also Perritt,supra note 9, at 49 (arguing that the lex mercatoria
system is analogous to the frameworkthat the electroniccommunityshould apply); Post, supra note 58,
at n. 15 (noting that, like Law Merchant,Cyberspacecould be "an example of unregulatedand uncon-
strainedrule-makingin the absence of state control.").
73. This enforcementtool is not perfect-any more than the tool of banishingmerchantsfrom the
medieval trade fairs was perfect for the development of the Law Merchant. See Paul R. Milgrom,
Douglass C. North & Barry R. Weingast, The Role of Institutions in the Revival of Trade: The Law
Merchant,Private Judges, and the ChampagneFairs, 2 EcON.& POL.1 (1990) (describingthe use of
banishment and other enforcement mechanisms prior to the rise of the state). Individuals intent on
wrongdoing may be able to sneak back on the Net or into a particularonline area with a new identity.
But the enforcementtools used by legal authoritiesin the real world also have limits. We do not refrain
from recognizing the sovereignty of our territorialgovernmentsjust because they cannot fully control
their physical bordersor all of the actions of their citizens.
minimallyaffect the vital interestsof sovereigns,the self-regulatingstructures

of Cyberspace seem better suited to dealing with the Net's legal issues.74
IV. LOCAL AUTHORITIES, FOREIGN RULES: RECONCILING CONFLICTS
What shouldhappenwhen conflictsarise betweenthe local territoriallaw

(applicableto personsor entitiesby virtueof theirlocationin a particulararea
of physical space) and the law applicableto particularactivities on the Net?
The doctrineof "comity,"as well as principlesappliedwhendelegatingauthor-
ity to self-regulatoryorganizations,provideus with guidancefor reconciling
such disputes.
The doctrineof comity,in the SupremeCourt'sclassic formulation,is "the
recognitionwhichone nationallows withinits territoryto the legislative,exec-
utive or judicialacts of anothernation,havingdue regardboth to international
duty and convenience,and to the rightsof its own citizens or of otherpersons
who are underthe protectionsof its law."75It is incorporatedinto the princi-
o d
ples set forth in the Restatement(Third)of Foreign Relations Law of the
_
United States, in particularSection403, which providesthat "a state may not
G
C
exercisejurisdictionto prescribelaw with respectto a personor activityhaving
connectionswith anotherstate when the exerciseof suchjurisdictionis unrea-
R
sonable,"76and that when a conflict between the laws of two states arises,
o n
"each state has an obligationto evaluateits own as well as the other state's
interestin exercisingjurisdiction... [and]shoulddeferto the otherstateif that
r e d
state's interestis clearly greater."77Comity arose as an attemptto mitigate
a
74. Social philosopherMichael Sandel has made a similar point in writing that new transnational
law-making institutionsare needed if the "loss of masteryand the erosion of community that lie at the
Sh
heart of democracy's discontent"is to be alleviated:
In a world where capital and goods, informationand images, pollution and people, flow
across national boundarieswith unprecedentedease, politics must assume transnational,even
global, forms, if only to keep up. Otherwise,economicpower will go uncheckedby democrat-
ically sanctionedpolitical power.....
... We cannot hope to govern the global economy withouttransnationalpolitical institu-
tions ....
Michael J. Sandel, America's Searchfor a New Public Philosophy, ATLANTIC MONTHLY, Mar. 1996, at
57, 72-73 (emphasis added); see also text accompanyingnotes 96-97 infra, for additionalparallels be-
tween our argumentsand Sandel's.
75. Hilton v. Guyot, 159 U.S. 113, 164 (1895); see also Mitsubishi Motors v. Soler Chrysler-
Plymouth,473 U.S. 614 (1985) (holding thatconcerns of internationalcomity requireenforcementof an
arbitrationclause); The Bremen v. ZapataOff-Shore Co., 407 U.S. 1, 15 (1972) (upholding a forum
selection clause "in light of present-daycommercialrealitiesand expandinginternationaltrade");Laurit-
zen v. Larsen,345 U.S. 571, 582 (1953) ("Internationalor maritimelaw ... aims at stability and order
through usages which considerationsof comity, reciprocityand long-range interest have developed to
define the domain which each nation will claim as its own."). Good general treatmentsof the comity
doctrine can be found in LEA BRILMAYER,
CONFLICTOF LAWS:FOUNDATIONS
AND FUTUREDIRECTIONS
145-89 (1991); MARKW. JANIS,AN INTRODUCTION TOINTERNATIONAL LAW330-38 (1988); Joel R.
Paul, Comityin InternationalLaw, 32 HARV.INT'LL.J. 1 (1991); Steven R. Swanson, Comity,Interna-
tional Dispute Resolution Agreements,and the Supreme Court, 21 LAW& POL'YINT'LBus. (1990);
Hessel E. Yntema, The ComityDoctrine, 65 MICH.L. REV.9 (1966); James S. Campbell,New Law For
New InternationalTrade (Dec. 3, 1993), at 5-6 (unpublishedmanuscript,on file with the StanfordLaw
Review).
76. RESTATEMENT
(THIRD)OF FOREIGNRELATIONS
LAW OF THEUNITEDSTATES? 403(1) (1987).
77. Id. ? 403(3).
some of the harsherfeaturesof a worldin which lawmakingis an attributeof

controlover physicalspacebutin whichpersons,things,andactionsmay move
acrossphysicalboundaries.It functionsas a constrainton the strictapplication
of territorialprinciplesthatattemptsto reconcile"theprincipleof absoluteter-
ritorialsovereignty[with] the fact that intercoursebetween nationsoften de-
mand[s] the recognitionof one sovereign's lawmakingacts in the forum of
another."78In general, comity reflects the view that those who care more
deeply aboutand betterunderstandthe disputedactivityshoulddeterminethe
outcome. Accordingly,it may be ideally suited to handle,by extension, the
new conflictsbetweenthe nonterritorial natureof cyberspaceactivitiesand the
legitimateneeds of territorialsovereignsandof those whose intereststhey pro-
tect on the otherside of the cyberspaceborder. This doctrinedoes not prevent
territorialsovereignsfrom protectingthe interestsof those individualslocated
withintheir spheresof control,but it calls uponthem to exercise a significant
degree of restraintwhen doing so.
Local officials handlingconflicts can also learn from many examples of
o d
delegatingauthorityto self-regulatoryorganizations.79Churchesare allowed
_
to make religious law.8" Clubs and social organizationscan define rules that
G
C
govern activities within their spheresof interest.81Securitiesexchanges can
establishcommercialrules, so long as they protectthe vital interestsof the
R
surroundingcommunities.In these situations,governmenthas seen the wisdom
o n
of allocatingrule-makingfunctionsto those who best understanda complex
phenomenonand who have an interestin assuringthe growth and health of
their sharedenterprise.
e d
Cyberspacerepresentsa new permutationof the underlyingissue: How
r
much should local authoritiesdefer to a new, self-regulatingactivity arising
a
Sh
independentlyof local controlandreachingbeyondthe limitedphysicalbound-
aries of the sovereign? This mixingof bothtangibleandintangibleboundaries
78. HaroldG. Maier, Remarks,84 PROC.AM. Soc. INT'LL. 339, 339 (1990); see also id. at 340
(arguing that the principle of comity informs the interest-balancingchoice of law principles in the Re-
statement); Paul, supra note 75, at 12-13 (comity arose out of "[t]he need for a more sophisticated
system of conflicts ... in connection with the emergence of the nation state and the rise of commerce
that broughtdifferentnationalitiesinto more frequentcontact and conflict with one another");id. at 45-
48 (noting that although the relationshipbetween the "classical doctrine of comity" and the Restate-
ment's principle of "reasonableness"is uncertain,the former "retainsa significant function in the Re-
statement");id. at 54 (comity principle "mitigatesthe inherenttension between principles of territorial
exclusivity and sovereign equality");cf Campbell, supra note 75, at 6 (The Supreme Court's comity
jurisprudence"inquires,in cases involving internationaltrade,what values facilitate that trade.Trading
nations have a common interest in supportingthese values, and therefore national agencies-courts,
legislators, administrators-should seek to respect, and therebystrengthen,these values as they engage
in the processes of law formation").
79. Perritt,supra note 9, at 1-2, 36-49.
80. Cf Gopnik, The VirtualBishop, NEWYORKER, Mar. 18, 1996, at 63 ("Of course, the primitive
Church was a kind of Internetitself, which was one of the reasons it was so difficult for the Roman
Empire to combat it. The early Christiansunderstoodthat what was most importantwas not to claim
physical power in a physical place but to establish a network of believers-to be on line.") (quoting
French Bishop Jacques Gaillot).
81. Perritt,supra note 9, at 42-43; cf MICHAEL WALZER, SPHERES OFJUSTICE: A DEFENSE OF
PLURALISM ANDEQUALITY 281-83 (1983) (discussing differences among various spheres of power and
authority).
leads to a convergenceof the intellectualcategoriesof comity in international

relationsand the local delegationby a sovereignto self-regulatorygroups. In
applyingboththe doctrineof "comity"andthe idea of "delegation"82 to Cyber-
space,a local sovereignis called uponto deferto the self-regulatory
judgments
of a populationpartly,but not wholly, composedof its own subjects.83
Despite the seemingcontradictionof a sovereigndeferringto the authority
of those who are not its own subjects,such a policy makessense, especiallyin
light of the underlyingpurposesof bothdoctrines. Comityand delegationrep-
resentthe wise conservationof governmentalresourcesand allocatedecisions
to those who most fully understandthe special needs and characteristicsof a
particular"sphere"of being. AlthoughCyberspacerepresentsa new sphere
thatcuts acrossnationalboundaries,the fundamentalprincipleremains. If the
sysops and users who collectively inhabitand controla particulararea of the
Net want to establishspecialrulesto governconductthere,and if thatrule set
does not fundamentallyimpinge upon the vital interestsof others who never
visit this new space, then the law of sovereignsin the physical world should
defer to this new form of self-government.
o d
_
Consider,once again, the trademarkexample. A U.S. governmentrepre-
sentativehas statedthat,since the governmentpaid for the initialdevelopment G
R C
and administrationof the domainname system, it "owns"the right to control
policy decisions regardingthe creationand use of such names.84Obviously,
o n
governmentfunds, in additionto individualefforts on a global scale, created
this valuableand finite new asset. But the government'sclaim based on its
d
investmentis not particularlyconvincing. In fact, the United States may be
e
assertingits rightto controlthe policies governingthe domainnamespace pri-
r
marilybecause it fears that any otherauthorityover the Net might force it to
a
pay againfor the ".gov"and ".mil"domainnamesused by governmentalenti-
Sh
ties.85 To assuagethese concerns,a Net-basedauthorityshouldconcedeto the
governmenton this point. For example,it shouldaccommodatethe military's
stronginterestin remainingfree to regulateand use its ".mil"addresses.86A
new Net-basedstandards-making authorityshouldalso accommodatethe gov-
ernment'sinterestsin retainingits own untaxeddomainnamesand prohibiting
counterfeiting.Given responsiblerestraintby the Net-basedauthorityand the
82. The idea of "delegation"is somethingof a fiction. But legal fictions have a way of becoming
persuasive and, therefore,real. See, e.g., LONL. FULLER, LEGAL FICTIONS 55 (1967). Self-regulatory
bodies evolve independentlyof the State and derive their authorityfrom the sovereign only insofar as
the sovereign, after the fact, claims and exercises a monopoly over the use of force.
83. See Henry H. Perritt,Jr., ComputerCrimesand Torts in the Global InformationInfrastructure:
Intermediariesand Jurisdiction20-22 (Oct. 12, 1995) (unpublishedmanuscript,on file with the Stanford
Law Review) (arguingthat underthe self-regulatoryapproach"communitiesof suppliersand consumers
of informationwould adopt their own rules for defamation,intellectualpropertyinfringement,misrepre-
sentation, and indecency, and would apply these rules througharbitrationmachineryagreed to through
the community").
84. See Maher, supra note 60 (noting the "arrogance"of the Federal NetworkingCouncil's posi-
tion on this issue).
85. Cf id. (noting that while other groups faced fees for new domain names, "[s]pecial arrange-
ments are made for users of '.gov' and '.edu' ").
86. See id. (noting "[t]he .mil domain is excluded"from the jurisdictionof the privatecorporation
that administersthe registrationof domain names).
developmentof an effective self-regulatoryscheme,the governmentmightwell

then decide thatit shouldnot spendits finiteresourcestryingto wresteffective
control of non-governmentaldomainnames away from those who care most
aboutfacilitatingthe growthof online trade.
Because controllingthe flow of electronsacrossphysicalboundariesis so
difficult,a local jurisdictionthat seeks to preventits citizens from accessing
specific materialsmust either outlaw all access to the Net-thereby cutting
itself off fromthe new global trade-or seek to impose its will on the Net as a
whole. This would be the moder equivalentof a local lord in medievaltimes
eithertryingto preventthe silk tradefrom passingthroughhis boundaries(to
the dismay of local customersand merchants)or purportingto assertjurisdic-
tion over the entire known world. It may be most difficultto envision local
territorialsovereignsdeferringto the law of the Net when the perceivedthreat
to local interestsarisesfromthe very free flow of informationthatis the Net's
most fundamentalcharacteristic-when, for example, local sovereignsassert
an interestin seeing thattheircitizensarenot adverselyaffectedby information
o d
G
thatthe local jurisdictiondeems harmfulbut thatis freely (andlawfully)avail-
_
able elsewhere. Examplesincludethe Germangovernment'sattemptsto pre-
vent its citizens from accessingprohibitedmaterials,87or the prosecutionof a
C
Californiabulletinboardoperatorfor makingmaterialoffensiveto local "com-
munitystandards"
may insist that their
n R
availablefor downloadingin Tennessee.88Local sovereigns
interest(in protectingtheir citizens from harm)is para-
d o
mountandeasily outweighsany purportedinterestin makingthis kindof mate-
rial freely available. But the opposing interestis not simply the interestin
"meta-interest"
e
seeing that individualshave access to ostensibly obscene material,it is the
r
of Net citizens in preservingthe global free flow of informa-
a
tion. If thereis one centralprincipleon which all local authoritieswithinthe
Sh
Net shouldagree, it must be thatterritoriallylocal claims to a rightto restrict
online transactions(in ways unrelatedto vital and localizedinterestsof a terri-
torial government)should be resisted.This is the Net equivalentof the First
Amendment,a principlealreadyrecognizedin the form of the international
humanrights doctrineprotectingthe right to communicate.89Participantsin
the new online trademustoppose externalregulationdesignedto obstructthis
flow. This centralprincipleof onlinelaw is importantto the "comity"analysis,
because it makes clear that the need to preservea free flow of information
across the Net is just as vital to the interestsof the Net as the need to protect
87. See note 20 supra.

88. See id.
89. See JonathanGraubert,What'sNews: A Progressive Frameworkfor Evaluating the Interna-
tional Debate Over the News, 77 CAL.L. REV.629, 631 (1989) ("The guiding principlein international
communications since World War II has been the U.S.-inspired goal of a 'free flow of information.'
According to this principle, '[flreedom of informationimplies the right to gather, transmitand publish
news anywhere and everywherewithout fetters.' ") (citing G.A. Res. 59 U.N. Doc. A/64/Add. 1, at 95
(1947)) (alterationsin original). The free-flow-of-informationprinciplehas been defined as a necessary
part of freedom of opinion and expression. See Article 19 of the Universal Declaration of Human
Rights, G.A. Res. 217(III)A, U.N. Doc. A/810, at 74-75 (1948) (stating that freedom of expression
includes "freedomto hold opinions withoutinterferenceand to seek, receive and impartinformationand
ideas through any media and regardlessof frontiers").
local citizens againstunwelcomeinformationmay appearto a local territorial

sovereign.90For the Net to realizeits full promise,onlinerule-makingauthori-
ties mustnot respectthe claims of territorialsovereignsto restrictonline com-
municationswhen unrelatedto vital and localized governmentalinterests.
V. INTERNAL DIVERSITY
One of a border'skey characteristicsis that it slows the interchangeof

people, things, and informationacross its divide. Arguably,distinct sets of
legal rules can only developand persistwhereeffective boundariesexist. The
developmentof a true"lawof Cyberspace,"therefore,dependsupona dividing
line betweenthis new online territoryandthe nonvirtualworld. Ourargument
so far has been that the new online sphereis cut off, at least to some extent,
fromrule-makinginstitutionsin the materialworldandrequiresthe creationof
d
a distinctlaw applicablejust to the online sphere.
But we hastento add that Cyberspaceis not a homogeneousor uniform
territorybehindthat border,where informationflows withoutfurtherimpedi-
G o
_
ment. Althoughit is meaninglessto speakof a Frenchor Armenianportionof
Cyberspace,because the physicalbordersdividingFrenchor Armenianterri-
R C
toryfromtheirneighborscannotgenerallybe mappedonto the flow of informa-
tion in Cyberspace,the Net has other kinds of internalbordersdelineating
o n
many distinct internallocations that slow or block the flow of information.
Distinctnamesand(virtual)addresses,specialpasswords,entryfees, andvisual
cues-software boundaries-can distinguishsubsidiaryareas from one an-
r e d
other. The Usenet newsgroup "alt.religion.scientology"is distinct from
"alt.misc.legal,"each of which is distinctfrom a chat room on Compuserveor
a
AmericaOnlinewhich, in turn,are distinctfromthe CyberspaceLaw Institute
Sh
listserveror Counsel Connect. Users can only access these differentforums
throughdistinct addressesor phone numbers,often navigatingthroughlogin
screens, the use of passwords,or the paymentof fees. Indeed,the ease with
which internalborders,consistingentirelyof softwareprotocols,can be con-
structedis one of Cyberspace'smost remarkableand salient characteristics;
settingup a new Usenetnewsgroup,or a "listserver" discussiongroup,requires
little more than a few lines of code.91
90. Moreover,the right of individualsto participatein various online realms depends critically on
their obtaininginformationabout those realms. Insofaras any territorialgovernmentmerely claims that
its laws and values are morally superior,it is not well situatedto oppose a free flow of informationthat
might lead its citizens to disagree. This would be the equivalentof defending ignoranceas a necessary
ingredient for preservationof the local state's values.
91. Listservers,for example, can be set up on any network(or Internet)server by means of simple
instructionsgiven to one of several widely available software programs(listproc or majordomo). A
Usenet discussion group in the "alt."hierarchycan be established by sending a simple request to the
"alt.config"newsgroup. See What is Usenet & Answers to FrequentlyAsked Questions About Usenet,
supra note 23.
Cyberspacenot only permits the effective delineationof internalboundariesbetween differenton-
line spaces, but it also allows for effective delineationof distinctonline roles within differentspheres of
activity. In the nonvirtualworld, we slip in and out of such roles frequently. The rules applicableto the
behavior of a single individual, in a single territorialjurisdiction, may change as he moves between
different legally significant persona (acting as an employee, a member of a church, a parent, or the
The separationof subsidiary"territories"or spheres of activity within

Cyberspaceand the barriersto exchanginginformationacross these internal
bordersallow for the developmentof distinctrulesets andfor the divergenceof
those rule sets over time.92The processesunderlyingbiologicalevolutionpro-
vide a usefulanalogy.93Speciation-the emergenceover time of multiple,dis-
tinct constellationsof genetic informationfrom a single, original group-
cannotoccurwhenthe originalpopulationfreelyexchangesinformation(in the
form of genetic material)amongits members. In otherwords,a single, freely
interbreedingpopulationof organismscannot divide into genetically distinct
populations.While the geneticmaterialin the populationchangesover time, it
does so more or less uniformly-for example, the populationof the species
Homoerectusbecomesa populationof Homosapiens-and cannotgive rise to
more thanone contemporaneous, distinctgenetic set. Speciationrequires,at a
minimum, some barrierto the interchangeof genetic materialbetweensubsets
of the originalhomogeneouspopulation.Ordinarily,a physicalbarriersuffices
to preventone subgroupfromexchanginggeneticdatawith another.Once this
o d
"border"is in place, divergencewithinthe "genepool"-the aggregateof the
_
underlyinggenetic information-in each of the two subpopulationsmay oc- G
C
cur.94 Over time, this divergencemay be substantialenough that even when
the physicalbarrierdisappears,the two subgroupscan no longerexchangege-
n R
netic material-i.e., they have become separatespecies.
Rules, like genetic material,are self-replicatinginformation.95The internal
d o
borderswithin Cyberspacewill thus allow for differentiationamong distinct
constellationsof such information-in this case rule-setsratherthan species.
a r e
officer of a corporation,for example). Cyberspacemay make the boundariesbetween these different
roles easier to maintain,insofar as explicit "tags,"distinct "signaturefiles," or screen names-can rela-
Sh
tively easily be attachedto messages originatingfrom the author's different roles.
92. Post, supra note 58, at para. 26 (asserting that the individual network "organizations"will
probablydeterminethe substantiverule-makingfor Cyberspace);see also David R. Johnson& Kevin A.
Marks,Mapping Electronic Data Communicationsonto Existing Legal Metaphors:Should We Let Our
Conscience (and Our Contracts)Be Our Guide?, 38 VILL.L. REV.487, 488-89 (1993) (explaining that
communicationservice providers,owners of disks carryingcentralizeddatabases,and people presiding
over electronic discussion groups have the power to select applicable rules).
93. For illuminating discussions of the many parallels between biological evolution and social
evolution in Cyberspace, see KEVINKELLY,OUT OF CONTROL:THE LAW OF NEO-BIOLOGICAL CIVILIZA-
TION(1994); John Lienhard,Reflections on Information,Biology, and Community,32 Hous. L. REV.
303 (1995); Michael Schrage, RevolutionaryEvolutionist,WIRED, July 1995, at 120.
94. This geographicbarriermerely permitsdivergence to occur; it does not guaranteeit. Specia-
tion will only occur, for example, if the two divided subpopulationsare subject to different selection
pressuresor at least one of them is small enough to accrue significantrandomchanges in its gene pool
("genetic drift"). For good, nontechnicaldescriptionsof evolutionarytheory, see DANIEL C. DENNETT,
DARWIN'S DANGEROUS IDEA: EVOLUTION AND THE MEANINGS OF LIFE (1995); JOHN MAYNARD SMITH,
ESSAYS ON GAMES, SEX, AND EVOLUTION(1988); JOHN MAYNARD SMITH, ON EVOLUTION(1972);
GEORGE C. WILLIAMS, ADAPTATION AND NATURAL SELECTION: A CRITIQUE OF SOME CURRENT EVOLU-
TIONARY THOUGHT (1966).
95. To survive, rules must be passed on somehow, whetherin the form of "case reports"or other
inter-individual or inter-generational methods. See RICHARDDAWKINS,THE SELFISHGENE (new ed.
1989). General parallels between biological evolution and the evolution of legal rules are discussed in
HAYEK, 1 LAW, LEGISLATION,
FRIEDRICH AND LIBERTY44-49 (1973); FRIEDRICH HAYEK,THE CONSTI-
TUTIONOFLIBERTY56-61 (1960); see generally Tom W. Bell, PolycentricLaw, 7 HUMANESTUD. REV.
1 (Winter 1991/92), available at http://osfl.gmu.edu/ihs/w91issues.html.
Contentor conductacceptablein one "area"of the Net may be bannedin an-

other. Institutionsthat resolve disputesin one "area"of Cyberspacemay not
gain supportor legitimacy in others. Local sysops can, by contract,impose
differingdefaultrulesregardingwho has the right,undercertainconditions,to
replicateand redistributematerialsthat originatewith others. While Cyber-
space's relianceon bits insteadof atoms may makephysical boundariesmore
permeable,the boundariesdelineatingdigital online "spheresof being" may
become less permeable. Securingonline systemsfrom unauthorizedintruders
may prove an easier task than sealing physicalbordersfrom unwantedimmi-
gration.96Groupscan establishonline corporateentitiesor membershipclubs
that tightly control participationin, or even public knowledge of, their own
affairs. Such groupscan reachagreementon or modify these rules more rap-
idly via online communications.Accordingly,the rule sets applicableto the
online world may quickly evolve away from those applicableto more tradi-
tional spheresand develop greatervariationamongthe sets.
How this processof differentiationandevolutionwill proceedis one of the
o d
morecomplex and fascinatingquestionsaboutlaw in Cyberspace-and a sub-
_
ject beyondthe scope of this article. We shouldpointout, however,an impor- G
R C
tant normativedimension to the proliferationof these internal boundaries
betweendistinctcommunitiesand rule-sets. Cyberspacemay be an important
forumfor the developmentof new connectionsbetweenindividualsandmecha-
o n
nisms of self-governanceby which individualsattaina sense of community.
Commentingon the erosion of nationalsovereigntyin the moder world and
d
the failureof the existing system of nation-statesto cultivatea moralconnec-
e
tion betweenthe individualand the community(or communities)in which she
r
is embedded,Sandelhas written:
a
Sh
96. Cyberspace,as M. Ethan Katsh has written, is a "softwareworld" where "code is the Law."
M. Ethan Katsh, Software Worldsand the First Amendment:VirtualDoorkeepers in Cyberspace, 1996
U. CHI. LEGALFORUM(forthcoming), available at http://www-law.lib.uchicago.edu/forum(quoting
WILLIAMMITCHELL,CITY OF BITS (1995)). Katsh adds:
To a considerableextent, networksreally are what softwareallows them to be. The Internetis
not a networkbut a set of communicationsprotocols.... [T]he Internetis software. Similarly,
the World Wide Web is not anything tangible. It is client-serversoftware that permits ma-
chines linked on a network to share and work with information on any of the connected
machines.
Id.; see also Post, supra note 58, at para. 16 ("[N]etworksare not merely governed by substantiverules
of conduct, they have no existence apart from such rules."). And software specifications can be un-
forgiving (as anyone who has triedto send an e-mail message to an incorrectlyspelled networkrecipient
can attest):
Entry of messages into, and routing of messages across, digitally-basedelectronic networks
... are controlledby more effective protocols [thangenerallygovern non-electroniccommuni-
cations networks in the "real world"]:each network's technical specifications (typically em-
bodied in software or switching mechanisms) constitute rules that precisely distinguish
between compliant and non-compliantmessages. This boundary [is not an] artificial con-
struct because the rules are effectively self-enforcing. To put the matter simply, you can't
'almost' be on the Georgetown UniversityLAN or America Online-you are either transmit-
ting LAN- or AOL-compliantmessages or you are not.
Id. at para.20 (emphasisadded). Thus, individualnetworkcommunitiescan be configured,by means of
unique specifications of this kind, to bar all (or some specified portion of) inter-networktraffic with
relative ease.
1398 STANFORD LAW REVIEW [Vol. 48:1367
The hope for self-governmenttoday lies not in relocatingsovereigntybut in
dispersingit. The most promisingalternativeto the sovereignstate is not a
cosmopolitancommunitybasedon the solidarityof humankindbuta multiplic-
ity of communitiesandpolitical bodies-some moreextensivethannationsand
some less-among whichsovereigntyis diffused. Onlya politicsthatdisperses
sovereigntybothupward[to transnational institutions]anddownwardcan com-
bine the power requiredto rival global marketforces with the differentiation
requiredof a publiclife thathopes to inspirethe allegianceof its citizens...
If the nationcannotsummonmore thana minimalcommonality,it is un-
likely that the global communitycan do better,at least on its own. A more
promisingbasis for a democraticpoliticsthatreachesbeyondnationsis a revi-
talizedcivic life nourishedin the moreparticularcommunitieswe inhabit. In
the age of NAFTA the politics of neighborhoodmattersmore, not less.97
Furthermore,the ease with which individuals can move between different rule
sets in Cyberspace has important implications for any contractarian political
philosophy deriving a justification of the State's exercise of coercive power
o d
over its citizens from their consent to the exercise of that power. In the nonvir-
_
sent inferred from someone merely remaining in the state is particularly
G
tual world, this consent has a strong fictional element: "State reliance on con-
C
unrealistic. An individual's unwillingness to incur the extraordinary costs of
leaving his or her birthplace should not be treated as a consensual undertaking
R
to obey state authority."98 To be sure, citizens of France, dissatisfied with
o n
French law and preferring, say, Armenian rules, can try to persuade their com-
patriots and local decision-makers of the superiority of the Armenian rule-set.99
d
However, their "exit" option, in Albert Hirschman's terms,100is limited by the
e
need to physically relocate to Armenia to take advantage of that rule set.'01 In
r
Cyberspace, though, any given user has a more accessible exit option, in terms
a
Sh
97. Sandel, supra note 74, at 73-74 (emphasis added).
98. Brilmayer,supra note 6, at 5.
99. In AlbertHirschman'sterms,they have a "voice"in the developmentof Frenchlaw, at least to
the extent that French law-makinginstitutionsrepresentand are affected by citizen participation. AL-
BERTO. HIRSCHMAN, EXIT,VOICEANDLOYALTY 106-19 (1970).
100. See id. at 106-09; cf RichardA. Epstein, Exit Rights under Federalism, LAW& CONTEMP.
PROBS.,Winter 1992, at 147, 151-165 (discussing the ability of exit rights to constrain governmental
power and the limitations of such rights).
101. The idea that citizens can easily exit physical jurisdictionsis, of course, unrealistic:
There has always been a strong fictional element to using this notion of a social contractas a
rationalefor a sovereign's legitimacy. When exactly did you or I consent to be bound by the
U.S. Constitution? At best, that consent can only be inferredindirectly, from our continued
presence within the U.S. borders-the love-it-or-leave-it,vote-with-your-feettheory of polit-
ical legitimacy. But by that token, is Saddam Hussein's rule legitimate, as least as to those
Iraqiswho have 'consented' in this fashion? Have the Zairois consentedto Mobutu'srule? In
the world of atoms, we simply cannot ignore the fact that real movement of real people is not
always so easy, and that most people can hardly be chargedwith having chosen the jurisdic-
tion in which they live or the laws that they are made to obey. But in cyberspace,there is an
infinite amount of space, and movement between online communities is entirely frictionless.
Here, there really is the opportunityto obtain consent to a social contract. Virtualcommuni-
ties can be establishedwith their own particularrule-sets;power to maintaina degree of order
and to banish wrongdoerscan be lodged, or not, in particularindividualsor groups;and those
who find the rules oppressiveor unfairmay simply leave andjoin anothercommunity(or start
their own).
Post, supra note 23, at 33.
of movingfrom one virtualenvironment'srule set to another's,thus providing

a more legitimate "selection mechanism"by which differing rule sets will
evolve over time.102
The ability of inhabitantsof Cyberspaceto cross bordersat will between
legally significantterritories,many times in a single day, is unsettling. This
power seems to undercutthe validity of developingdistinct laws for online
cultureand commerce: How can these rulesbe "law"if participantscan liter-
ally turnthem on and off with a switch? Frequentonline travelmight subject
relativelymobile humanbeings to a far largernumberof rule sets than they
would encountertravelingthroughthe physical world over the same period.
Establishedauthorities,contemplatingthe rise of a new law applicableto online
activities, might object that we cannoteasily live in a world with too many
differentsources and types of law, particularlythose made by private(non-
governmental)parties,withoutbreedingconfusionand allowinganti-socialac-
tors to escape effective regulation.
But the speed with which we can cross legally meaningfulbordersor adopt
o d
and then shed legally significantroles should not reduce our willingness to
_
recognizemultiplerule sets. Rapidtravelbetween spheresof being does not G
C
detractfromthe distinctivenessof the boundaries,as long as participantsrealize
R
the rules are changing. It also does not detractfrom the appropriateness
rules applyingwithinany given place, any morethanchangingcommercialor
of
n
organizationalroles in the physical world detractsfrom a person's ability to
o
d
102. The ease with which individualsmay move between communities (or inhabit multiple com-
e
munities simultaneousthrougha fractionationof theirown individualidentities)also implies that Cyber-
r
space may provide conditions necessary and sufficient for something more closely resembling the
a
optimal collective productionof a particularset of goods-namely, "laws"-than can be achieved in the
Sh
real world. Cyberspacemay closely approximatethe idealized model for the allocation of local goods
and services set forth by CharlesTiebout, in which optimal allocation of locally producedpublic goods
is provided by small jurisdictionscompeting for mobile residents. See CharlesTiebout, A Pure Theory
of Local Expenditures,64 J. POL.ECON.416 (1956). The Tiebout model of intergovernmentalcompeti-
tion has four components:(1) a perfectlyelastic supply of jurisdictions,(2) costless mobility of individu-
als among jurisdictions, (3) full information about the attributes of all jurisdictions, and (4) no
intejurisdictional externalities. See RobertP. Inman& Daniel L. Rubinfeld,The Political Economy of
Federalism, Working Paper No. 94-15, Boalt Hall Programin Law and Economics (1994), at 11-16,
reprintedin Developmentsin Public Choice (D. Mueller ed., 1995). (As Inmanand Rubinfelddemon-
strate, a fifth assumption of the Tiebout model-the provision of public goods with a "congestible
technology" such that the per capita cost of providing each level of a public good first decreases and
then increases as more individualsmove into the jurisdiction-is not necessaryfor the model. Id. at 13.)
In a Tieboutian world,
.. each locality provides a package of local public goods consistent with the preferencesof
its residents (consumer-voters). Residents whose preferencesremain unsatisfiedby a particu-
lar locality's package of goods and services would (costlessly) move .... Escape from unde-
sirable packages of goods and services is feasible as a result of two explicit characteristicsof
the Tiebout model: absence of externalitiesand mobility of residents.
Clayton P. Gillette, In Partial Praise of Dillon's Rule, or, Can Public Choice Theory Justify Local
GovernmentLaw, 67 CHI-KENT L. REV.959, 969 (1991). We suggest that Cyberspacemay be a closer
approximationto ideal Tieboutian competition between rule-sets than exists in the nonvirtual world.
This is a consequence of (1) the low cost of establishingan online "jurisdiction,"see text accompanying
note 91 supra, (2) the ease of exit from online communities,(3) the relative ease of acquiringinforma-
tion about the practices of online communities, and (4) the greater impermeabilityof the internal,
software-mediatedboundariesbetween online communities in Cyberspace, see note 96 supra, which
may mitigate (at least to some extent) the problem of inter-communityexternalities.
obey and distinguishrules as a memberof many differentinstitutionalaffilia-

tions.103Nor does rapidtravel lower the enforceabilityof any given rule set
within its appropriateboundaries,as long as groupscan controlunauthorized
boundarycrossingof groupsor messages. Alternatingbetweendifferentlegal
identitiesmany times duringa day may confuse those for whom Cyberspace
remainsan alien territory,but for those for whomCyberspaceis a morenatural
habitatin which they spendincreasingamountsof time it may become second
nature. Legal systemsmustlearnto accommodatea moremobilekindof legal
person.104
VI. CONCLUSION
Global electroniccommunicationshave creatednew spaces in which dis-
tinct rule sets will evolve. We can reconcilethe new law createdin this space
d
with currentterritoriallybasedlegal systemsby treatingit as a distinctdoctrine,
applicableto a clearlydemarcatedsphere,createdprimarilyby legitimate,self-
G o
_
103. The Net may need new meta-rules for transportinginformationacross these borders. For
example, the members of the LamdaMOOmulti-userdomain debated at length whether to permit the
R C
use of informationobtainedfrom the virtualdiscussion group out in the "realworld." Mnookin, supra
note 66, at 21-23. Various online systems have rules about copying or reposting materials from one
online area to another. For example, the terms of service for Counsel Connect contains the following
rules for acceptable copying:
o n
[M]emberswho submit materialshall be deemed to (i) grantto ... subscribersto the system a
paid up, perpetual,world-wideirrevocablelicense to use, copy, and redistributesuch materials
and any portions thereof and any derivativeworks therefrom. . . Each member agrees, as a
d
condition of such license, (i) not to remove identifying source informationfrom verbatim
e
copies of member-suppliedmaterials... and (ii) not to reproduceportionsthereof in any way
r
that identifiesthe source but fails to describe accuratelythe natureand source of any modifica-
a
tion, alterationthereto or selection therefrom.
Sh
B. Notwithstandingthe licenses grantedby membersand informationsuppliers,subscrib-
ers ... shall not engage in systematic, substantialand regularreplicationof materialssupplied
to the system by a commercial publisher . . . where the effect of such actions is to provide
anotherperson who is not an authorizedsubscriberto such materialswith a substantialsubsti-
tute for such a subscription.
Terms and Conditions for Use of Counsel Connect (on file with the Stanford Law Review). America
Online's Terms of Service Agreement contain a somewhat similar clause:
[Members]acknowledge that (i) AOL contains information,software,photos, video, graphics,
music, sounds and other material and services (collectively, "Content").... AOL permits
access to Contentthat is protectedby copyrights,trademarks,and other proprietary(including
intellectual property)rights .... [Members']use of Content shall be governed by applicable
copyright and other intellectualpropertylaws.... By submittingContentto a "PublicArea"
... [members]automaticallygrant... AOL Inc. the royalty-free,perpetual,irrevocable,non-
exclusive right and license to use, reproduce,modify, adapt,publish, translate,create deriva-
tive works from, distribute,performand display such Content (in whole or part) worldwide
AOL Inc.'s Terms of Service Agreement (on file with the StanfordLaw Review).
104. See Sandel, supra note 74, at 74 ("Self-governmenttoday ... requiresa politics that plays
itself out in a multiplicity of settings, from neighborhoodsto nations to the world as a whole. Such a
politics requires citizens who can abide the ambiguity associated with divided sovereignty, who can
think and act as multiply situatedselves."); see also SHERRY TURKLE, LFE ONTHESCREEN: IDENTITY IN
THEAGEOFTHEINTERNET (1995); TURKLE, supra note 44. To be sure, sophisticatedanalysis even of
traditionallegal doctrines suggests that we appearbefore the law only in certain partial, conditional
roles. JOSEPH VINING, LEGAL IDENTITY: THECOMING OFAGEOFPUBLIC LAW139-69 (1978). But this
partial and conditional nature of "persons" who hold rights and duties is more pronounced in
Cyberspace.
regulatoryprocesses,andentitledto appropriate deference-but also subjectto

limitationswhen it overstepsits appropriatesphere.
The law of any given place musttake into accountthe special characteris-
tics of the space it regulatesandthe types of persons,places, and thingsfound
there. Justas a country'sjurisprudencereflectsits uniquehistoricalexperience
and culture,the law of Cyberspacewill reflectits specialcharacter,which dif-
fers markedlyfromanythingfoundin the physicalworld. Forexample,the law
of the Net mustdeal with personswho "exist"in Cyberspaceonly in the form
of an e-mail addressand whose purportedidentitymay or may not accurately
correspondto physicalcharacteristicsin the real world. In fact, an e-mail ad-
dress might not even belong to a single person. Accordingly,if Cyberspace
law is to recognizethe natureof its "subjects,"it cannotrest on the same doc-
trinesthat give geographicallybasedsovereignsjurisdictionover "whole,"lo-
catable,physical persons. The law of the Net must be preparedto deal with
persons who manifestthemselvesonly by means of a particularID, user ac-
count, or domainname.
o d
Moreover,if rightsand duties attachto an accountitself, ratherthanto an
_
underlyingreal worldperson,traditionalconceptssuch as "equality,""discrim-
ination,"or even "rightsand duties"may not workas we normallyunderstand G
R C
them. For example, when AOL usersjoined the Net in large numbers,other
Cyberspaceusers often ridiculedthem based on the ".aol"tag on their email
addresses-a formof "domainism"
Netiquette. If a doctrine of n
thatmightbe discouragedby new formsof
o
Cyberspacelaw accordsrights to users, we will
d
need to decide whetherthose rights adhereonly to particulartypes of online
world.
a e
appearances,as distinctfromthose attachingto particularindividualsin the real
r
Similarly,the types of "properties" that can become the subject of legal
Sh
discussionin Cyberspacewill differfromreal worldreal estateor tangibleob-
jects. Forexample,in the realworldthe physicalcovers of a bookdelineatethe
boundariesof a "work"for purposesof copyrightlaw;105those limits may dis-
appearentirelywhen the same materialsare partof a largeelectronicdatabase.
Thus, we may have to change the "fairuse" doctrinein copyrightlaw that
previouslydependedon calculatingwhatportionof the physicalworkwas cop-
ied.106 Similarly,a web page's "location"in Cyberspacemay take on a value
unrelatedto the physicalplace wherethe disk holdingthatWeb page resides,
andeffortsto regulateweb pagesby attemptingto controlphysicalobjectsmay
only cause the relevantbits to move from one place to another. On the other
hand,the boundariesset by "URLs"(UniformResourceLocators,the location
105. See Chatterjee,supra note 51, at 406 n. 142 (noting that "[o]riginalcopyrightparadigmswere
created to protect only [physical] books").
106. Electronicinformationcan be dispensedin any sized serving, rangingfrom a few words to an
entire database. If we use the databaseas a whole as our measure,then any user's selection will be an
insignificant portion. In contrast,if we tried to use the traditionalboundariesof the book's cover, the
user cannot observe this standard. In some cases it is an entirely theoreticalboundary,with respect to
material only dispensed from the database.This case demonstratesagain that the absence of physical
bordersbetween "works"in Cyberspaceunderminesthe utility of doctrines, like copyright law, that are
based on the existence of such physical boundaries.
of a documenton the WorldWide Web) may need special protectionagainst

confiscation or confusingly similar addresses. And, because these online
"places"may containoffensive material,we may need rules requiring(or al-
lowing) groupsto post certainsigns or markingsat these places' outerborders.
The boundariesthat separatepersonsand things behave differentlyin the
virtualworld but are nonethelesslegally significant. Messages posted under
one e-mailnamewill not affectthe reputationof anothere-mailaddress,even if
the same physical person authorsboth messages. Materialsseparatedby a
passwordwill be accessibleto differentsets of users, even if those materials
physically exist on the very same harddrive. A user's claim to a right to a
particularonline identityor to redresswhen that identity'sreputationsuffers
harm,may be valid even if thatidentitydoes not correspondexactly to that of
any single personin the real world.107
Clearboundariesmake law possible, encouragingrapiddifferentiationbe-
tween rule sets and definingthe subjectsof legal discussion. New abilitiesto
travelor exchangeinformationrapidlyacrossold bordersmay changethe legal
o d
frameof referenceand requirefundamentalchangesin legal institutions.Fun-
_
damentalactivities of lawmaking-accommodatingconflictingclaims, defin-
G
C
ing propertyrights,establishingrules to guide conduct,enforcingthose rules,
and resolvingdisputes-remain very much alive withinthe newly defined,in-
R
tangibleterritoryof Cyberspace.At the same time, the newly emerginglaw
o n
challengesthe core idea of a currentlaw-makingauthority-the territorialna-
tion state, with substantialbut legally restrainedpowers.
d
If the rules of Cyberspacethus emergefrom consensuallybased rule sets,
e
andthe subjectsof suchlaws remainfree to move amongmanydifferingonline
r
spaces, then consideringthe actionsof Cyberspace'ssystem administrators as
a
the exercise of a power akin to "sovereignty"may be inappropriate.Undera
Sh
legal frameworkwherethe top level imposesphysicalorderon those below it
and dependsfor its continuedeffectivenesson the inabilityof its citizens to
fight back or leave the territory,the legal and political doctrines we have
evolved over the centuriesare essentialto constrainsuch power. In thatsitua-
tion, whereexit is impossible,costly, or painful,then a rightto a voice for the
people is essential. But when the "persons"in questionare not whole people,
when their "property" is intangibleand portable,and when all concernedmay
a
readilyescape jurisdictionthey do not find empowering,the relationshipbe-
tween the "citizen"and the "state"changes radically. Law, defined as a
thoughtfulgroupconversationaboutcore values, will persist. But it will not,
could not, and shouldnot be the same law as thatapplicableto physical,geo-
graphically-defined territories.
107. Whetherthelaw shouldconsiderthatinterestto be a "property"

rightor a righton behalfof
the "persona"
in questionremainsin doubt.

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DavidJohnsonand DavidPost arguethatCyberspacerequiresa systemof

global basis requiresregistrationin each country. A trademarkowner must

Effects. The correspondencebetweenphysicalboundariesand "lawspace"

activitieswithinthatborder.8The "consentof the governed"impliesthatthose

8. Declaration on Principles of InternationalLaw Concerning Friendly Relations and Co-opera-

remoteplaces and people separatefromone another.10The Net enablestrans-

mentanduse of TDF's will underminetheir"informational sovereignty,"13 will

ties regulatorsseem likely to lose theirbattleto impose local regulationson a

online tradeinsofar as it might adverselyaffect local citizens. The Attorney

Nor are the effects of online activitiestied to geographicallyproximatelo-

differentterritorialjurisdictions.24What substantivelaw should we apply to

tion to any particulargeographicarea.27Althoughthe Net creatorsdesigned

2. Migrationof OtherRegulatedConductto the Net.

teachers,charterbanks with authorized"branches,"and license doctors and

who are engagedin variousactivitiesthere? Whatmechanismsexist or need to

1. The New Boundaryis Real.

easier to be certainwhich of those rules applyto your activitiesonline thanto

only on the Web. If a companywants to know where to registerits use of a

bilities-perhaps by requiringthatthe opportunityfor replybe takenadvantage

by conditioning access to the Net by local citizens on their buying services

countrywherethe workmightbe received? Putmorebluntly,for workson the

means of building up reputational capital that can subsequently be converted

transactionswill have perverseresults.50Applicationof the "firstsale" doc-

David Post, Leaping Before Looking:Proposals WouldMake UnsettlingChanges, LEGAL TIMES,Apr. 8,

transmissionand copying necessaryto facilitatetheiruse withinthe electronic

Even if we agree that new rules shouldapply to online phenomena,ques-

Experiencesuggeststhatthe communityof onlineusersand serviceprovid-

core principles of "netiquette"in mailing lists and discussion groups67-

(discussing how new users learn "netiquette").

70. See LEONE. TRAKMAN, THELAWMERCHANT: THEEVOLUTION OFCOMMERCIAL LAW11-12

people who cared most aboutand best understoodtheir new creationformed

minimallyaffect the vital interestsof sovereigns,the self-regulatingstructures

IV. LOCAL AUTHORITIES, FOREIGN RULES: RECONCILING CONFLICTS

What shouldhappenwhen conflictsarise betweenthe local territoriallaw

some of the harsherfeaturesof a worldin which lawmakingis an attributeof

leads to a convergenceof the intellectualcategoriesof comity in international

developmentof an effective self-regulatoryscheme,the governmentmightwell

87. See note 20 supra.

local citizens againstunwelcomeinformationmay appearto a local territorial

One of a border'skey characteristicsis that it slows the interchangeof

The separationof subsidiary"territories"or spheres of activity within

Contentor conductacceptablein one "area"of the Net may be bannedin an-

of movingfrom one virtualenvironment'srule set to another's,thus providing

obey and distinguishrules as a memberof many differentinstitutionalaffilia-

regulatoryprocesses,andentitledto appropriate deference-but also subjectto

of a documenton the WorldWide Web) may need special protectionagainst

107. Whetherthelaw shouldconsiderthatinterestto be a "property"

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