SAN JOSE, Calif. -- Federal agents routinely seize property used in crimes, from drug dealer's cars to hackers' computers. But the government has begun nabbing Internet domain names -- a tactic civil libertarians say threatens online merchants and could enable the feds to spy on unwitting Web surfers.

In one case, the government took over Web sites that it said peddled marijuana paraphernalia. In another, prosecutors acquired a site whose owner was charged with selling chips that let video game systems run pirated games.

But rather than shutting them down like in the past, the sites remained alive -- and now greet visitors with stern warnings from government agencies.

The trend is alarming online civil liberties groups and legal scholars, who say that as electronic commerce becomes more common, the tactic could destroy people's livelihoods. While businesses can physically relocate in the material world, in cyberspace they depend on their domain name, the Web's equivalent of the front door of a bricks-and-mortar venture.

"If you want to take down a Web site but simply confiscate the servers, operators can always buy other servers," said Michael Overly, an attorney specializing in computer law at Foley & Lardner. "But if they take the domain name away, then they've put the person out of business."

Critics of the Justice Department's raids in recent weeks also say they fear the government could use the new method to spy on Web surfers who visit confiscated sites.

"The government is suddenly in a position of being able to monitor the Web-surfing activities of unwitting individuals who believe they are going to a Web site ... but possibly implicating themselves into some law enforcement investigation," said David Sobel, general counsel of the Electronic Privacy Information Center.

The Justice Department did not return repeated phone calls seeking comment on what it plans to do with the sites and their visitor logs.

In announcing the indictment last week of 55 people for allegedly selling drug paraphernalia on the Internet, Attorney General John Ashcroft said several sites had been redirected to DEA servers and that prosecutors had asked the court to redirect another "15 to 20 sites within the next 30 days."

Among legal issues that remain unresolved is whether a domain name constitutes property, or a contract the owner has with the company that provided it. If it's the former, a domain name could indeed be seized like a car, house or computer. Domain transfers have in the past occurred as a result of criminal or civil cases, but Overly said the courts would ultimately decide the issue.

"The government has done many things over the years," he said, "that ultimately turn out not to be legal."

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Electronic Privacy Information Center: www.epic.org