WIPO Proposes to “Compliment” UDRP at New gTLDs With New RPMs That Will Accelerate Trademark Rights

Philip CorwinBlog

Domainers may think that RPMs are something they can check on their car’s tachometer, but WIPO is proposing a new species of RPMs that have the potential to fundamentally change the domain name dispute arbitration process — and substantially increase the risk of reverse domain name hijacking – first at new gTLDs, and later at incumbent gTLDs.

The ICA is actively working to protect registrant rights as this process goes forward – and domainers concerned by the implications of what is transpiring should give active consideration to attending and making their voices heard at ICANN’s June meeting in Sydney (see http://syd.icann.org/) ,where the Intellectual Property Constituency’s (IPC) recommendations for protecting trademark rights in new gTLDs will be considered by the ICANN Board.

On March 13, 2009 Eric Wilbers, Director of WIPO’s Arbitration and Mediation center, dispatched a letter to several high-ranking ICANN executives regarding the protection of trademarks on new gTLDs. That letter is available at http://www.wipo.int/export/sites/www/amc/en/docs/icann130309.pdf.

ICA has some areas of agreement with WIPO’s views on new gTLDs. For example, WIPO has recommended “that new gTLDs be introduced in a controlled manner”. Similarly, the very first bullet point in ICA’s December 15, 2008 comment letter filed with ICANN stated “ICANN must proceed cautiously in its consideration of new gTLD applications and should announce in advance a prioritization system to assure orderly and comprehensive review”. Our letter went on to explain:

“We also find it difficult to believe that ICANN can give adequate consideration to the volume of application it expects to receive in the first round – even if one-third of the anticipated 500 applications were delayed due to objections raised against them, that would still require ICANN staff to review and approve an application nearly every day of the first year of the program’s operation, including weekends and holidays, if the first round decks are to be cleared before the contemplated initiation of the second application round approximately one year later. Such a torrid pace is unlikely to afford adequate consideration of applicant qualifications and capabilities or of the soundness of their proposals, and is likely to either result in inordinate delays or future failures and scandals that will be destabilizing to the DNS and negatively impact the ICANN community and ICANN itself. Therefore, we believe that ICANN should adopt and state, in advance of accepting applications, a prioritization regime that will allow it to process all first round applications in a thorough and orderly fashion.”

The pre-delegation dispute resolution process contained in the current version of ICANN’s Draft Applicant Guidebook for new gTLDs bases its substantive criteria on WIPO’s Joint recommendations, and seem generally reasonable. ICA also has no major issues with some aspects of WIPO’s post-delegation dispute resolution procedure recommendations insofar as they relate to registries. For example, “if a registry uses the delegated TLD for a purpose unreasonably inconsistent with relevant representations made in the application phase, such that trademarks are infringed”, then it should be subject to some type of sanction. That is, you can’t establish .dove as a gTLD dedicated to world peace and then switch it to the sale of ice cream or soap bars.

But then WIPO goes to  propose a slippery slope involving the “adoption of appropriate mechanisms to counter abuse”, not just of the gTLD but through domain name registrations within it, that would constitute a “safe harbor for registries” against subsequent allegations that they have turned “a blind eye to systematic cybersquatting”.

In other words, new gTLDs will have an affirmative duty to actively police against activities construed by trademark interests to constitute cybersquatting by domain registrants if they wish to enjoy that safe harbor against allegations brought directly against them by those very same trademark interests. 

WIPO goes on to explain that “the UDRP will remain an important curative tool for particular disputes involving the considered transfer of the disputed domain name to the trademark owner. In connection with ICANN’s New gTLD Program, we also see scope for the application of even more accessible, comprehensive mechanisms suited to the potential scale of abusive registrations as the DNS expands.” Continuing, WIPO states its advocacy of additional “Rights Protection Mechanisms (RPMs) to safeguard legitimate trademark interests in the DNS.” WIPO elaborates that these RPMs could include mechanisms already employed by existing registries – such as sunrise and defensive registration mechanisms, exclusion mechanisms, and priority challenge mechanisms – and then goes on to add that there are “further models conceivable”.

It is these further, as yet unknown models that are worrisome, to the extent that they begin to displace the UDRP as the mechanism for resolving allegations of trademark infringement against domain name registrants. Trademark owners have been openly discussing notice-and-takedown procedures for ordinary infringement allegations. ICA believes that such expedited procedures are appropriate for websites that are engaged in illegal activities such as phishing, malware distribution, or the hosting of illegal content such as child porn, but that they do not afford adequate due process in situations now subject to the UDRP. Registry applicants will be under intense practical pressure to offer the full range of RPMs – including “further models” – as the WIPO letter makes it clear that a registry’s endorsement of such mechanisms will assist its application and its implementation of “adequate RPMs” will be a significant consideration in any post-delegation case leveled against it.

The UDRP is far from perfect, and domainers have many of the same complaints about it as trademark holders, including its cost and the lack of uniform appeals mechanisms and binding precedents. But reform of the UDRP is a serious subject worthy of separate consideration – “complimenting” it in the context of developing the final rules for the rollout of new gTLDs, where trademark owners are the very squeaky wheel demanding to be greased before ICANN can open the new gTLD floodgates, is a near-certain formula for domainer rights getting short shrift – despite WIPO’s statement that it “appreciates the need to strike a reasonable balance between the protection of trademark rights…and the legitimate expectations of good-faith domain name registrants”.

The ICA will continue to actively monitor and participate in the new gTLD process as it relates to trademark protections and all other matters relevant to our members. We learned last week that the IPC was open to having non-constituency members serve on its task force preparing trademark protection recommendations and we nominated ICA President Jeremiah Johnston, who oversees Sedo’s Rights Protection Program. While we hope the IPC will incorporate the domainer viewpoint within their working group we will provide input no matter what. We are also actively participating in the GNSO’s Registration Abuse Policy Working Group and in the Business Constituency’s own internal discussions of appropriate trademark protections. In all of these endeavors we will continue to be guided by the initial position on rights protection staked out in our December 2008 comment letter —

•    Strong, cost-effective, and readily implemented protections for rights holders should be established but they must be limited to enforcing their rights under existing law and not be premised upon the creation of broader rights by ICANN fiat. It is for this reason that we object to creation of a reserve list of trademark names as this would provide rights protections beyond the geographic and relevant marketplace limitations of trademark law. We also object to the imposition of any new rights or procedures that would supplant or supplement the UDRP absent extensive consideration of such proposals in a process that ensures that registrant concerns about current UDRP enforcement trends are heard.

Protection of the Rights of Others

The ICA strongly supports the protection of intellectual property (IP) rights, including trademark rights.  We have adopted a Code of Conduct that prohibits intentional trademark infringement. And we have supported adoption of policies by individual registries, and the adoption of new pricing regimes by ICANN, that appear to be successfully eradicating that abuse of the Add/Grace Period (AGP) known as domain tasting which is sometimes associated with deliberate cybersquatting on the trademark rights of others.

For these reasons ICA strongly supports the adoption of policies in conjunction with new gTLDs to support IP rights. We believe that the proposed procedures accomplish this by affording IP owners the right to bring objections against any proposed string that they believe would infringe their rights. As ICANN has noted in its memorandum on this issue, “it is not unusual for more than one entity to have a trademark in the same word or phrase either for different products or services or registered in different jurisdictions”. The Internet and trademark rights coexist uneasily, as the former is a global data transmission system while the latter is restricted by relevant marketplace  as well as geographic considerations. It is for that reason that we oppose the suggestion of some IP interests that ICANN establish a master list of trademark terms  that will be either off-limits to or extremely difficult to establish as a new gTLD; vast tracts of generic dictionary words, in multiple languages, would inevitably wind up on such a list. To cite one example, the word dove is trademarked as the name of a soap bar as well as of an expensive line of ice cream, but the dove is also the universal symbol of peace – and if a non-profit peace advocacy group wishes to apply for .dove as a registry devoted solely to its activities and goals it should not be subject to blockage or objection from either of the cited business entities.

It is critically important that IP rights protections adopted in conjunction with the gTLD process be limited to protecting existing rights conferred by relevant law and do not create newly expanded rights beyond the scope of current law. Therefore, we have some concern that the criteria for resolving objections is being developed by IP experts, as such individuals may try to utilize this process to exactly such an expansionist end, seeking from ICANN what they have been unable to persuade legislatures to confer. In any event, until these criteria are fully developed and published for public review it is impossible to render an informed judgment upon them. Our concern regarding the present vagueness of these criteria stems from our observation, which we have articulated to ICANN on numerous occasions, that the Uniform Dispute Resolution Process (UDRP) is becoming less and less uniform and predictable and that a presumptive burden is being imposed upon registrants that is contrary to the clear language of the UDRP.  Any extralegal expansion of IP rights resulting from the gTLD process has the potential to find its way into and further bias the UDRP against good faith registrants. This concern is particularly acute given that the World Intellectual Property Organization, which is inherently biased in favor of IP rights and their expansion and also serves as a leading arbiter of UDRP cases, is the only designated provider of dispute resolution services for legal rights objections and that such disputes will be decided by a single panelist.

Notwithstanding that caution, we support requiring gTLD applicants to adopt strong best practices to protect IP rights and, if the method chosen is a sunrise period, we would urge that trademark owners be charged only a reasonable minimum fee to register their protected names at the second level on the new gTLD. And, of course, we have no objection to the requirement that all second level registrations be subject to the UDRP – so long as it is implemented in a uniform fashion in keeping with its clearly stated requirement that a party alleging infringement carry the burden of proving the three required elements for a finding against the registrant. However, we strongly object to suggestions that ICANN establish a near-term requirement for cost-free takedown procedures for domains alleged to be established in bad faith for both new and existing gTLDs, as establishment of bad faith registration is already one of the key elements of the UDRP – it should remain one of three elements in a balanced proceeding, and not become the single determinative element in a biased proceeding. Any alteration or supplementation of the UDRP should not be implemented as a footnote to new gTLD implementation but only after presentation to and consideration by the community — and such process must take into consideration and redress concerns with the present UDRP voiced by registrants and not simply react to the complaints of trademark interests.

We believe that the concerns of many trademark holders will be alleviated when the reality of new gTLD applications begins. The impending situation should in no way be analogous to current abuses, in which a cybersquatter can seek to monetize a clear typographical variation of a famous trademark on .com for less than $10 per year, and can hide his identity through a proxy service. New gTLDs applicants will put at risk a full $185,000 application fee, will require several $hundred thousand more in the bank, and will entail establishing one’s bona fides as a legitimate organization with ICANN. Given these realities, we would be surprised to see any extensive infringement attempted through new registry applications. As for the second level, various infringement scams may be difficult to implement due to a scarcity of type-in traffic at most new gTLDs and their low placement in search engine results. In any event, the UDRP remains available for use against bad faith registrations.  In addition, we strongly urge ICANN and all registries to increase their commitment to finding means of taking down domains that are used to facilitate criminal activity such as phishing scams and stand ready to offer whatever assistance the domain investment community can provide in that effort.