New generic Top-Level Domain Names (gTLDs) are all about innovation, entrepreneurship and creativity; they are about identifying new entrants, opening up competition and providing the domain name market with the opportunity to explore new means of interaction on the Internet. Equally, new gTLDs are a great opportunity for existing businesses and brands to reconsider their business practices and models and to adapt to new commercial realities and ideals. In both cases, however, it is important that some basic rules and principles are maintained so that terms are not abused, terms are assigned to their rightful owners and, where there are no rightful owners, a robust and fair process is in place to ensure that the assignment of words is done in a manner that does not endanger the Internet, does not confuse consumers or does not obstruct current societal structures.
I, for one, have been a proponent of new gTLDs from the early days of their policy development process within ICANN. I always believed that the existing gTLDs – and mainly the .com space – have created artificial scarcity, which is primarily responsible for much of the cybersquatting and the abuse trademarks experience. I do not share the same fears as those who argue that new gTLDs will create intolerable levels of cybersquatting or will necessitate defensive registrations from brand and trademark owners alike. As for the policy itself, I do not believe it is perfect and I feel that, for certain issues, ICANN could have taken a different direction, but, ultimately I recognize and respect ICANN’S multistakeholder governance structure and the decisions that have come out of it. Lately, however, something has caught my attention, which can potentially create problems. Almost the same day ICANN opened up its application process, a tiny start-up was granted by the United States Patent and Trademark Office (USPTO) a trademark for .bank (registration number 4085335). What is the problem with this? The problem is twofold: first of all, there is a general principle within traditional trademark law, which instructs that generic terms cannot be trademarked if they are to reflect what the term means. In this context, a company would not be able to register the word coffee and sell coffee. This would provide an unfair competitive advantage to any company and would, most likely, excommunicate all other similar companies selling coffee. Secondly, by granting this application, the USPTO is essentially leaving ICANN and its Governmental Advisory Committee (GAC) with a big problem. Part of the whole exercise regarding the role of the GAC within the new gTLD process related to the GAC’s role; this issue was resolved with the agreement that the GAC would be in the position to provide early advice to any new gTLD application, effectively giving the GAC the right to torpedo and determine the success of an application, which the GAC believes it raises issues of cultural significance or is contrary to national laws. To this end, it is exactly names like .bank that the GAC had in mind when they were pushing ICANN to insert this provision within the Applicant Guidebook: “[The GAC may advise] ICANN that there are concerns about a particular application ‘dot-example’. The ICANN Board is expected to enter into dialogue with the GAC to understand the scope of concerns. The ICANN Board is also expected to provide a rationale for its decision”. Now, with the USPTO granting trademark rights for .bank, this early warning mechanism becomes superfluous, and multiple rights are created for .bank. On the one side, there are the rights of the trademark owner; on the other, there is the GAC which believes that the term .bank is sensitive enough to interfere and whoever applies needs to go through a scrutiny process; and, finally, there is also the rumoured applicant of .bank – a joint effort made by the American Bankers Association (ABA) and BITS, part of Financial Services Roundtable. So, in practical terms, what the USPTO has essentially done is to provide the opportunity to an independent entity to object the application of .bank by asserting valid trademark rights. So, this is a mess and a mess that will only get worse unless trademark offices around the world stop granting trademark registrations to .generics. The way things are right now, the GAC may sign off the .bank gTLD to ABA and BITS, but the owner of .bank will have valid claims to stop this application process or at least demand some sort of financial compensation for giving up the name to someone else. And, if he is really pissed off or he wants to retain .bank for his own personal use, he can then sue for trademark infringement. In any case, the trademark owner is the only winner here and both the GAC and the American Bankers should feel very pissed off with the USPTO. At this stage, the only solution is for the USPTO to accept that they screwed up and recall this trademark. Non-Commercial Users Constituency Letter - To the Governmental Advisory Committee
September 28, 2011 Heather Dryden, Chairwoman of the Governmental Advisory Committee (GAC) Dear Heather, The Non-Commercial Users Constituency (NCUC) would like to take the opportunity to express its views in relation to the Uniform Domain Name Dispute Resolution Policy (UDRP). NCUC understands that the GAC has sent a letter to the Generic Names Supporting Organization (GNSO), raising some concerns as to whether a Policy Development Process (PDP) should be initiated in relation to a review of the UDRP. NCUC would like to welcome the GAC’s initiative in approaching the GNSO and submit its statement with its views on the UDRP. NCUC thinks it is very encouraging that the GAC is willing to speak with the GNSO and exchange ideas on the UDRP, one of ICANN’s oldest and most important policies. It has lately come to our attention, however, that the views of the GAC on the UDRP were drafted with the solicitation and advise submitted not by the entire groups represented at the GNSO Council. NCUC is very concerned with this process and would like to submit for your consideration the statement and the comments it has submitted during the public comment period for the UDRP. We hope that you take into consideration the indisputable evidence that exists and our serious concerns on the current operation and practice of the UDRP. NCUC would like to thank you and the GAC for your attention to the NCUC's comments and requests the opportunity to discuss the issues related to the UDRP with members of the GAC at the meeting in Dakar. We look forward to cooperating with you on this very important matter. Respectfully submitted, Dr. Konstantinos Komaitis, Chair of the Non-Commercial Users Constituency Comments of the Noncommercial Users Constituency (NCUC) on the Preliminary GNSO Issue Report on the Current State of the Uniform Dispute Resolution Policy (UDRP) UDRP review should be the presumptive outcome of this process. NCUC supports a review and believes that the burden of proof is on those who oppose it. We believe so for the following reasons: All other ICANN policies must be regularly reviewed and improvements continuously sought. The UDRP has been in place for a long time, was put together very quickly in the earliest stages of ICANN’s existence, and has not been reviewed or modified since. Many country code TLDs have instituted similar Dispute Resolution Procedures (DRPs). Although many are based in part on the ICANN model, they often introduce slight procedural or substantive modifications. ICANN needs to assess whether it can learn from those differing experiences. A significant amount of academic research and critical literature has developed around the UDRP which can be assessed for problem areas and mined for proposals to improve it. No stakeholder or independent commentator now claims that the UDRP is perfect. Virtually all of the panelists on the workshop held at the ICANN 41 meeting in Singapore and in the earlier webinar noted specific improvements or changes they would like to see, even if they did not prefer to invest time in a PDP. NCUC believes that resistance to the policy’s review comes from two sources. One is a fear of various parties that a formal Policy Development Process (PDP) might make the policy “worse than it is now”. In response to that, we reply that a PDP does not presume that the UDRP will be changed; it simply allows all the Stakeholder Groups within ICANN to systematically explore and answer questions about whether it should be changed and if so, whether there is agreement on ways to change it. If there is no consensus among GNSO stakeholders about any specific change, nothing should change. Another argument heard against a review is that the timing is bad. Some believe that the timing is bad because we are headed into the new TLD program, which relies on the UDRP and the Uniform Rapid Suspension (URS) policy, and that consideration of change will “destabilize” these efforts. Others believe that other policy-making activities should be prioritized. The first claim seems entirely illogical to us. The new TLD program will expand the usage of the UDRP and the URS will rely on certain elements of the UDRP. Moreover, the URS is designed upon the same substantive and procedural ethos of the UDRP; if the UDRP is not working, we need to ensure that we fix it so that its existing flaws are not transferred to and will not affect the operation of the URS. It seems that the time between now and the actual coming to market of new TLDs is the ideal time to review the UDRP and fix any flaws. Further, we simply cannot agree with anyone who sees the UDRP and trademark – domain name conflicts in general as a low-priority area for ICANN. The UDRP touches on issues that are central to ICANN’s mission and fundamental to the interests of nearly all of its stakeholder groups. If ensuring that the UDRP is functioning properly is not a priority, what is? To conclude, regular review and updating of policies is often presented as an “ICANN value” or way of policymaking, and it would be terribly odd for that value to not apply to one of the only substantive policies that ICANN has created -one that impacts every domain name registrant. The presumption of any ICANN policy should be constant review and improvement and the UDRP is no exception to the presumption. After more than a decade of practice and evidence, this policy is beyond ripe for a review. The Preliminary Issues Report NCUC is not satisfied with the quality of the published GNSO Issue Report. We expect Issue Reports to involve the collection, compilation and analysis of relevant factual evidence, and a neutral and balanced assessment of relevant literature. The Report should be enhanced to take account of the factual evidence and analysis generated in the 12 years since the UDRP has been in effect, to provide the GNSO Council with informative background materials that can prepare it for policy discussions and debates. Over the past twelve years, the UDRP has generated a significant amount of independent academic research and critical examination. There are also statistical sources available, both in the research literature and from the UDRP providers. If one uses focused search techniques and devotes two or three days to examining the most important materials, one finds about a dozen useful empirical studies and analytical law review pieces on the UDRP. These reports could have and should have been summarized and referenced in the Issues Report. While it does take time to sift through this material and glean its findings, the amount of time consumed would almost certainly be less than that consumed by organizing a “webinar” and a survey. Instead of webinars and surveys, that merely elicit opinions from the handful of people already involved in ICANN who happen to be available, a literature review considers the evidence amassed over time, and subject to peer and critical review. There is an important distinction between an internal opinion poll among insiders with an agenda and a fact-based Issues Report. ICANN Issues Reports, and GNSO policy development processes generally, should not rely exclusively on casual internal soundings, but rather apply a higher intellectual standard and depth of understanding. If professionals, social scientists and researchers outside of ICANN have devoted resources and expertise to the analysis of ICANN and its policies, our processes can only benefit from drawing upon these materials. We note that the Security and Stability Advisory Committee (SSAC) reports routinely involve reviews of the relevant research literature and often do a good job of compiling and summarizing such literature. The GNSO needs to do the same. As the primary policy making arm for generic domains on the Internet, a higher level of analysis should be sought, as befitting its responsibility to good governance and the global public interest. Summary of research literature To aid the compilation of a more complete report, we list and provide brief summaries of the relevant research in the appendix to this comment. The sources are in chronological order. We ask that this information be incorporated into the revised Issues Report. The overview exposes a huge disparity between the Preliminary Issue Report conclusions and the conclusions of most of the research literature on UDRP. The preliminary report portrays the UDRP as completely consistent, fair and universally supported. Nearly all scientific reports, on the other hand, while noting the UDRP’s success at reducing the costs of resolving domain name disputes and rectifying gross forms of cybersquatting, tend to be critical of both substantive and procedural aspects of the UDRP. In other words, independent, neutral research does not support the preliminary report's assertions that UDRP is fair, consistent and in no need of review. Helfer, Laurence R. and Dinwoodie, Graeme B., Designing Non-National Systems: The Case of the Uniform Domain Name Dispute Resolution Policy. William & Mary Law Review, Vol. 43, p. 141, 2001; Stanford/Yale Jr. Faculty Forum Paper No. 01-05. Available at SSRN: http://ssrn.com/abstract=275468 The article critically assesses the Uniform Domain Name Dispute Resolution Policy (UDRP) as a potential model for solving the legal challenges presented by transborder activity. It describes the conditions that led to the UDRP's formation and considers whether the UDRP can and should be replicated elsewhere. While authors believe that UDRP succeeded in bypassing cumbersome mechanisms of national and international law making and in fulfilling demand for effective dispute settlement, they do not believe that it should be uncritically extended to other contexts. This article contains no empirical or statistical analysis of UDRP results. Mueller, M. (2001). Rough Justice: A Statistical Assessment of ICANN's Uniform Dispute Resolution Policy. The Information Society Volume 17, Issue 3, 2001, 151 - 163 A statistical analysis of UDRP case outcomes based on the concern that ICANN allows the complainant to select the dispute resolution service provider. The statistical tests indicate that complainant selection of dispute resolution service providers does lead to forum shopping that biases the results. Geist, Michael (2001), Fair.com? An Examination of the Allegations of Systemic Unfairness in the ICANN UDRP http://aix1.uottawa.ca/~geist/geistudrp.pdf This study finds that influence over panel composition is likely the most important controlling factor in determining case outcomes. Providers steer a majority of the cases toward complainant-friendly panelists. Fifty-three percent of all NAF single panel cases were decided by only six people, and the complainant winning percentage in those cases was 94%. Provider influence over panelists diminishes in three-member panel cases, 4 since both complainant and respondent choose one of the panelists and exercise some influence over the choice of the third; predictably, complainant win rates go down in three-member panels. The study concludes by proposing changes to the UDRP to instill greater fairness and confidence in the process. Froomkin, A. Michael (2002), Uniform Dispute Resolution Policy—Causes and (Partial) Cures. 67 Brooklyn Law Review 605. This paper describes the main features of the UDRP and ICANN’s accompanying rules of procedure and compares them to the recommendations of the WIPO proceeding and Report called for in the 1998 White Paper. The article documents four "unfair aspects of the UDRP rules:" (1) the selection and composition of the arbitral panel; (2) the failure to provide a registrant with adequate time to reply to a complaint; (3) the limited opportunity for complainants who lose a UDRP action to get their cases into court; and (4) the absence of any meaningful check on the providers’ creation of supplemental rules that effectively tilt the playing field. Notes that in practice, UDRP’s requirement that names be registered and used in bad faith “appears to have been completely lost on numerous arbitrators, who have read 'and' as if it meant 'or.'” Notes how the noncommercial use defense imported a tarnishment concept and that this "undermines a substantial part of the free-speech value of the non-commercial and fair use defenses" and "could be used to deny protection to legitimate criticism sites.” Mueller, M. (2002). Success by Default: A New Profile of Domain Name Trademark Disputes under ICANN’s UDRP. http://dcc.syr.edu/PDF/markle-report-final.pdf Study supported by the Markle Foundation based on a comprehensive review and classification of the first 4,000 UDRP cases. The UDRP has been an effective remedy for cybersquatting primarily because it makes it economically inefficient for abusive registrants to defend their names. Known cybersquatters default 70–100% of the time. The study’s compilation of case statistics provides many insights into the UDRP’s results. E.g., eighteen percent (18%) of UDRP claims are based upon unregistered trademarks; the UDRP has protected personal names as strongly as registered marks; of the 20 cases UDRP panelists cite as precedents most often, all were won by Complainants and all but 4 were Respondent defaults. The study further provides proof that decisions regarding gripe and/or criticism sites are inconsistent, and calls for clarifying standards for a finding of “confusing similarity” to a trademark such that criticism, parody and commentary are not suppressed. Selby, John (2004). Competitive Justice?: The Role of Dispute Resolution Providers under ICANN’s UDRP, 1 Macquarie Journal of Business Law 23 Having examined the quantitative and qualitative means by which Dispute Resolution Providers can compete for market share in UDRP disputes, the main thesis of the article is that the requirement that "competition" between dispute resolution providers be a design principle in the UDRP was (and continues to be) flawed. Competition between 5 such providers results in flawed incentives and likely injustices, most notably it can bias those providers towards making it easier for complainants to achieve victory over respondents (particularly through panelist selection processes and differences between provider supplemental rules). Competition between providers of justice in a situation where they are competing for selection by only party is antithetical to the principle of equal treatment of parties in a dispute. T. Lee, D. Hunter and D. Orr, "Cohesion and Coherence in the UDRP," (2008) A study that tests the hypothesis that UDRP panelists are more likely to side with complainants or respondents who are of the same nationality as they are. The study used automated techniques to process UDRP decision documents to sample 2944 disputed domains where the nationalities of the panelist and both litigants were known. Based on this data, the hypothesis of a nationality bias appears to fail. However, the overwhelming number of Americans in both the respondent and complainant sample may limit the results’ generality. Komaitis, Konstantinos. The Current State of Domain Name Regulation: Domain Names as Second-Class Citizens. Routledge, 2010. Book-length analysis that argues that domain names are a form of property, and the property rights held by domain name registrants need to be recognized in law – independently of, and carefully distinguished from, the limited rights associated with trademark protection. The book discusses the history, legal basis, procedural aspects and performance of ICANN’s Uniform Domain Name Dispute Resolution Policy (UDRP). Analyzes the differences between arbitration and the UDRP, which is sometimes characterized as an arbitral process; most of the differences are shown to weaken the rights of registrants, binding them to a procedure and rules while allowing the complainant more choice and options. The book concludes with some procedural and substantive recommendations that, if applied, will help the UDRP to become a more fair and balanced system. Recommendations Substantive and/or Procedural Review of UDRP? For NCUC, the key question is not whether to conduct a review of the UDRP, but rather, how to conduct a review of the UDRP. NCUC members agree that at the very least, a review of the noted procedural flaws of the UDRP should be thoroughly examined by the impacted community. A number of NCUC members further believe there should be an additional review of the underlying substantive policies contained within the UDRP, including their ability to protect freedom of expression guarantees and the fair use or other noncommercial rights of domain name registrants. Thus while the precise scope and framing of the UDRP review is open for discussion and input from all impacted stakeholders, NCUC contends that at the very least, a procedural review of the UDRP is necessary at this time. Use standard ICANN processes, not a hand-picked group Existing GNSO policy development processes are precisely what this type of examination was set up for and allows for balanced input from all impacted stakeholders. NCUC does not support having this process carried out by an arbitrarily selected group of “experts”. The GNSO was established for exactly this purpose and has put in place processes that provide room for multi-stakeholder participation and can reach results that reflect the views of all stakeholder groups within the ICANN structure. The community learned a valuable lesson with the failure of the single-constituency-driven Implementation Review Team (IRT), and created the subsequent Special Trademark Issues Team (STI), which reached unanimous consensus within the GNSO and drew much less criticism concerning issues of bias or misrepresentation, because it had incorporated members from across the community. We, therefore, suggest that ICANN make use of the existing GNSO processes that were established to evaluate policies and make recommendations as the community deems necessary. Ever since the issue of a potential review of the Uniform Domain Name Dispute Resolution Policy (UDRP) was placed on the table, two camps were created: those advocating against a review – the Intellectual Property Constituency (IPC), some big brand owners and their lawyers and the UDRP accredited centers, who have been basing their arguments on issues of timing. Their main (and only) argument has been that a potential review of the UDRP would upset the current status in the adjudication of domain names and would create instability in the new gTLD environment. The other camp, the non-commercial users, have been advocating that the timing for a review is right, given the fact that the UDRP is one of the oldest ICANN policies and has been operating for more than ten years now. In the comments submitted during the public comment period, the Non Commercial Users Constituency (NCUC) outlined the academic research that has been conducted in relation to the UDRP, its process and its substance. For the past ten years, academic scholars, including myself, have indicated that the UDRP is in serious need for a review and that the system is flawed to the extent that it does not have any checks and balances, it is occasionally biased and it is procedurally flawed. These are not arbitrary accusations, but are based on extensive scholarly research and study.
The ICANN Staff Report that came out in the beginning of August suggested against reviewing the UDRP, but the decision ultimately sits with ICANN’s Generic Names Supporting Organization. One thing that we need to understand, which might assist in also understanding why there is such a great upheaval when it comes to the UDRP, is that there are many interests at stake. The accredited centres do not want to see the UDRP reviewed because for them the adjudication of domain names has become a business. WIPO and the National Arbitration Forum have managed to generate a great deal of business from domain name disputes and many of their panellists have become quite comfortable in earning their living out of the UDRP. For the trademark community, the UDRP has provided the means through which they are able to exert their power over the domain name registration culture and, to a certain extent, control the ownership of names and words used in our everyday vocabularies. At the same time, through the registration of domain names, they have managed to receive international protection for their marks, something that they could not have achieved by following the traditional trademark registration channels. So, I do understand (although I don’t agree nor do I accept it) why these bodies are pushing ICANN not to initiate a PDP on the UDRP. But, there is something that I do not understand. Only yesterday, a letter sent by the GAC surfaced in the email list of the GNSO. According to the letter, the GAC is asking the GNSO not to proceed to a UDRP review at this stage. “The GAC is aware that the GNSO is considering initiating a Policy Development Process (PDP) for the purpose of reviewing the Uniform Domain Name Dispute Resolution Policy (UDRP). The GAC wishes to convey to the GNSO its view that a decision in favour of such a PDP at the time of launching the new gTLD program would have public policy implications of great concern to the GAC”. I have too many problems with this (initial) statement. First of all, I do not recall another time (and I might be mistaken) when the GAC has sent a letter to the GNSO asking for anything; doing it for the UDRP is quite alarming. But, more importantly, why the sudden interest? Considering that the whole issue of the UDRP started in May, why sent this letter now? The GAC did not participate in the UDRP webinar, did not participate in the Singapore UDRP panel session and did not submit any comments on the issue during the public comment period. Generally, I have never (and mean never) heard any of the GAC members talk or being concerned about the UDRP. So, why now? How did the UDRP become a priority of the GAC? From what the letter states, it is because the GAC is concerned about the impact on 'public policy'. Yes, you have heard right - again the never-ending public policy argument. But, the idea that the UDRP should not be reviewed due to ‘public policy implications’ is as ridiculous as the idea of the UDRP being a fair system. First of all, this does not make any sense. What ‘public policy implications’ could a review of the UDRP create? Isn’t it a public policy issue the protection of free speech through clear provisions? Is it not an issue of public policy the need to provide to an international system of adjudication with clear checks and balances? These are quintessential issues that any democratic government should seek to protect. So, why doesn’t the GAC strive to secure these fundamental issues on the basis of public policy concerns? Well, the answer appears to be, because the letter did not come straight from the GAC. According to the meta info and the information retrieved from the properties of the word document, the letter was written by a trademark law firm – specifically the US based law firm of Covington & Burling. I am wondering whether the rest of the GAC is aware that their official position on a very important issue concerning the dispensation of rights between trademark owners and domain name holders is coming from a US law firm. The rest of the letter follows more or less the same arguments we have so far heard from the trademark community: “The new gTLD program will see the introduction of several new rights protection mechanisms. The inevitable uncertainty associated with the introduction of these untested RPMs would be compounded if simultaneously the future of the primary, pre-existing and proven PRM – the UDRP – were also subject to uncertainty as a result of a long-running PDP”. I, personally, never understood this argument, no matter how much I have tried. But, let’s say that I am just dumb - in any event, the first step of a the PDP will not be to change the UDRP – it will be to ask the community to determine whether the UDRP needs to be reviewed. So, there is really no reason to panic or to make such extreme statements, seeking to spread unnecessary fear to the community. Another interesting point in the letter is the following: “Further, the GAC notes that almost 50% of the country code top level domain (ccTLD) operators have either adopted the UDRP itself or a variant of it, such that any potential changes to the UDRP that could result from a PDP would potentially have broad implication beyond the remit of the GNSO”. Rubbish – even if we accept this figure, why make a review of the UDRP dependant on the stability of these processes? Needless to say that many of these ccTLD operators have taken the UDRP and have created much fairer and more balanced versions of it. Take, for example, NOMINET’s equivalent policy. It started as a copy of the UDRP, but it is currently a policy document that has managed to surpass the UDRP in many ways: it has incorporated clear safe harbour provisions and it has adopted an internal appeals process, providing this way a system with more checks and balances. (The STI actually suggested its safe harbour provisions based on NOMINET's wording). Why was NOMINET allowed to amend and create new provisions within its own body of rules and the UDRP is not allowed to do the same? Wouldn’t the GAC like to see a more balanced, better and fairer UDRP, especially since there is evidence that this can be achieved? Therefore, this GAC letter to the GNSO only tells us one thing: the same way the trademark community used the GAC to channel its concerns on the STI recommendations, the same way it is using it now to prevent a potential review of the UDRP. But, whereas in the STI recommendations, the GAC had sort of made its own research and sort of knew what it was talking about, in this case the GAC appears clueless and it is embarassing. If the GAC knew the history, process and the various issues of the UDRP, it would realise that not reviewing it has public policy implications (to use their own language) that governments should be concerned with. So, I would recommend the GAC to go back and read all the academic writing that exists and dates back to 2000. It is really an eye-opener and, in any case, it would help the GAC form its own conclusions and possibly write its own letter. In a space of two days, two ICANN-related documents made their appearance: GAC’s response to the ICANN Board’s questions in relation to the scorecard and the new gTLD Applicant Guidebook responding to the GAC’s document. The issue of Rights Protection Mechanisms was apparently so significant that the GAC submitted its clarifications in a separate document from all other issues.
In relation to the RPMs, the latest version of the Guidebook seeks to strike an unsuccessful compromise in some issues and provides some significant changes to the previous version. However, for me two things stand out more than the others and I don’t suggest that the other issues are not of some concern: inclusion of all types of IP rights in the Trademark Clearinghouse and the ‘loser pays’ model of the Uniform Rapid Suspension System. Inclusion of all types of intellectual property in the Trademark Clearinghouse! The GAC’s responses in relation to the Clearinghouse provide some great insight regarding the vision the trademark holders in association with the various governments – most certainly those that have already indicated their wish for strict forms of IP protection – have for such a mechanism. In particular, the GAC provided some clarification regarding its proposal for the inclusion of all types of intellectual property rights within the Clearinghouse. According to the answers submitted to the Board, the GAC explains that such an inclusion “would obviate the necessity to develop separate mechanisms for these types of intellectual property”. Exactly when did we discuss and further decide that copyrights and patents would require a similar mechanism? Where did ICANN acquire the legitimacy to authorize the creation of a mechanism for types of intellectual property other than trademarks? Well, we all know that ICANN does not have the legitimacy to even suggest policy for other types of IP rights (personally, I even contest its legitimacy to create policy for trademarks) and in any discussions we had about potential inclusion of other IP rights in the Clearinghouse even the trademark community failed to sell such a proposal. Simply, there are no valid arguments that would justify ICANN opening up the Clearinghouse to any forms of IP that can be valid or legitimate. So, this begs the question: why does the GAC insist on it? I can think of one answer: by including all types of IP rights in the Clearinghouse, the IP community will have the opportunity to use the Clearinghouse for all kinds of purposes, e.g. for blacklisting domain names and registrants. This is not a Hollywood science fiction scenario (and, if it is, I certainly claim copyright before I get bullied into surrendering it). Both in the US (COICA) and UK (Policy dealing with domain names used in criminal activity), Congress and NOMINET respectively, are exploring ways concerning the take down of domain names that facilitate the infringement of copyright and the promotion/sale of rogue pharmaceuticals and counterfeit goods. We all know and have read the arguments with this kind of regulation – free speech, human rights and fair use are all at stake. We also know that certain governments do not pay attention to these concerns and continue to pretend that the only real victim here is the IP community. But, whereas such regulatory initiatives were limited to certain jurisdictions and national sovereignties, now they might become international policy. My point is this: if all types of IP rights were to be included, what would stop the Clearinghouse from using its database in a way far and beyond its original scope? What would prevent the Clearinghouse to start a separate ‘blacklist’ that lists those domain names that legislation like COICA addresses? How can we ensure that the database that will be created under COICA will not be fed into the Clearinghouse? In all this, ICANN does not appear to take the GAC’s considerations on board, but does not appear to either categorically reject them. ICANN chooses to be vague on this issue. In section 3.2.4, ICANN’s final version of the Clearinghouse states: “The proposed standards for inclusion in the Clearinghouse are: other marks that constitute intellectual property”, which might simply be addressing what GAC refers to as ‘local rights’, although, even in this case, local rights are subject to cultural relativism and are highly contested because of their highly national nature; and, then in section 3.6 “Data supporting entry into the Clearinghouse of marks that constitute intellectual property of types other than those set forth in sections 3.2.1-3.2.3 above…”, which sort of gives the Clearinghouse carte blanche into accepting other forms of IP rights; and, finally, the way the term ‘ancillary services’ is used in the final version of the Guidebook is also alarming. The original vision of ‘ancillary services’ was to put to rest the debate as to whether common law marks should be included in the Clearinghouse; and, because the community could not decide, the idea was to allow the inclusion of common law marks through an ‘ancillary services’ mechanism. Now, ancillary services are divorced from their association with what types of trademarks should be included and could be interpreted as allowing the Clearinghouse to provide services – classed as ‘ancillary - for other types of intellectual property. This provision in the Clearinghouse is vague and opaque – and we all know vague policies can mean one thing: wide, discretionary and potentially bias interpretations. At least, this is the case with ICANN’s policies and I hope I get to be wrong. The ‘Loser Pay’s model in the Uniform Rapid Suspension System (URS) In light of news hitting the Internet that trademark bullying is not only a rumor but a current practice exercised by big and powerful trademark owners, ICANN has submitted in its recent version of the URS a provision for a ‘loser pays’ all model to domain name disputes. According to the provision: “A limited ‘loser pays’ model has been adopted for the URS. Complaints listing twenty-six (26) or more disputed domain names will be subject to an Response Fee which will be refundable to the prevailing party. Under no circumstances shall the Response Fee exceed the fee charged to the Complainant”. Although the reality is indeed that if someone registers this amount of domain names corresponding to a certain mark, that someone is most probably a cybersquatter, ICANN does not explicitly state whether these 26 domain names should come from the same individual. ICANN only states that the Complaint should list 26 or more domain names, but it does not clarify whether the complaint should be against the same respondent. So, again here, this provision can be read as allowing the Complainant to bring one complaint for several domain names which concern the same mark but are registered by different registrants. Can this be the case? There is nothing to suggest otherwise and, if the discretion panels normally exercise in such policies is indicative, nothing stops the URS from being expanded to such a procedural allowance. But, the ‘loser pays’ model, even if this limited, creates a much bigger problem. It feeds into trademark intimidation and bullying, sort of legitimizing it if you wish. The fact is that, so far, trademark bullying occurred through the fear of court litigation and its associated costs. The message to registrants was clear: we will sue you if you don’t comply and, if we do, you end up engaging and paying a lot of money, which we can afford and you can’t. So, its better to surrender your domain name now that you still have the time. All this was happening at a national level. Now, with this provision, the same practice will also happen at an international level with the blessings of ICANN. Imagine, for instance, someone who has registered 26 variations of a trademark for free speech purposes. Will that someone be subject to a URS and, more importantly, to a potential ‘loser pays’ model? This provision will certainly disincentivize legitimate registrants from responding, encouraging further the existing culture of defaults and creating an unbalanced and biased system. Needless to say that the URS is not equipped for such a provision. The URS lacks the checks and balances that exist in traditional adjudication as it promotes speed. You cannot have a system that wishes to award such costs and not have some checks that ensure this takes place according to due process. Systems, like the UDRP and this one, are prone to bias and abuse as they are conceived to protect certain rights – so why feed into this bias? So, ICANN has entered again a very dangerous territory. The compromise solution that ICANN provided (remember that the GAC originally did not want to put a cap in the ‘loser pays’ model) is as problematic. The criterion that ICANN uses is not clear and the provision is certainly open to the widest interpretations possible. I hope I am mistaken here, but this system can easily backfire and it will certainly allow many mark holders to use also the URS as a tool for intimidation and bullying. For adjudicators and decision makers default constitutes perhaps one of the major procedural hurdles during the adjudication process. A defaulting party is the one that fails to appear before a court of law or a tribunal within a timely manner, thus failing to exercise her right of defence. Unquestionably, this kind of procedural awkwardness imposes a shadow of doubt in the delivery of justice. The problems with default are many: defendants don’t get to respond to the plaintiff’s assertions; judges find it extremely hard to produce solid decisions; justice struggles. If we were to prioritize, we could easily argue that the greatest challenge of default focuses on how the adjudicator will be able to reach decisions in a fair and equitable manner without, however, capitulating its own obligation for independence and impartiality; the judge cannot possibly be asked to read the defaulting party’s mind, thus inevitably decisions need to be taken absent the defendant.
But somehow, even in the absence of the defendant, justice is still ensured. The existing checks and balances of traditional adjudication processes alongside axiomatic principles relating to the rights of the parties provide a sound basis for the delivery of justice. As part of their mandate to deliver justice, courts have to make sure that the defendant is served and, if that fails, at the very minimum the court must exhaust all the possibilities for service of process. At the same time, courts also have to abide by the idea of the presumption of innocence and the right of defence. Article 48 of the EU Charter of Fundamental Rights states: “1. Everyone who has been charged shall be presumed innocent until proven guilty according to law. And, 2. Respect for the rights of the defence of anyone who has been charged shall be guaranteed”. With this in mind, nothing in ICANN’s dispute resolution mechanisms remotely resembles this thinking. The truth is that ICANN’s processes have historically suffered from the issue of default. When the Uniform Domain Name Dispute Resolution (UDRP) was created back in 1999, default was not identified as part of its procedural rules. It was an issue that the drafters of the UDRP had either not considered or they intentionally omitted. But, default was inevitable, especially in a mechanism designed for online disputes like the UDRP, which concerns parties located anywhere in the world and everything is done electronically, from the submission of the necessary forms until the delivery of justice. So, when default started creeping into the UDRP system, the panels opted for the easiest, fastest and most unfair option – they associated it with bad faith, generating this way a vicious circle of decisions that made all defaults indiscriminately tied to bad faith. And to make matters much worse, no one within the adjudication process (ICANN or WIPO or any other accredited dispute resolution provider) stopped to question or even investigate some of the possibilities of default. Because bad faith aside, default may occur for various reasons: the domain name holder (respondent) did not receive the complaint because the email went into her spam folder; the respondent did not have time to respond to the complaint (the UDRP gives the respondent 14 days to respond); the respondent resides in a developing country or a somewhere with limited Internet access; the respondent does not speak English (and most of the complaints are submitted in English); the respondent does not understand what the UDRP is or how it works; the respondent does not have the time or money to hire an attorney to assist with the response – and the list of reasons goes on. Fast forward now to ICANN’s new gTLD program and the idea of a Uniform Rapid Suspension System (URS). After years of debate, multiple versions of the same policy and controversial meetings, the issue of default still appears not to be settled correctly and to constitute one of the worst attributes of ICANN’s dispute resolution mechanisms. The Governmental Advisory Committee’s (GAC) recommendation, which in relation to default has been accepted by the ICANN Board, basically disseminates one simple message: default means bad faith. The GAC scorecard says: “If, as is expected in the majority of cases, there is no response from the registrant, the default should be in favour of the complainant and the website locked”. All this sentence is wrong: ‘as expected’ means that default constitutes some sort of a bizarre normative account in domain name disputes; ‘in the majority of cases’ means that without having implemented the URS, we should expect more than half of the URS cases to be in default; ‘the default should be in favour of the complainant’ means default equates to some form of malicious conduct. On top of all this, the Examiner is stripped of any right to attempt to identify good faith, even in the case of default. Using what I consider a very bad choice of words to refer to the party defaulting as ‘non-cooperative’ both ICANN and the GAC agree, “In addition, the examination of possible defences in default cases according to para 8.4(2) means an unjustified privilege of the non-cooperating defendant.” Here is the paradox with this approach. On the one hand, the UDRP (and the current language of the URS) give wide discretionary powers to the panels to find bad faith and interpret it any way they see fit. On the other hand, however, it doesn’t allow the panels to find good faith and apply it. The argument goes that adjudicators cannot be expected to be ‘mind readers’. Sure and I am sure that none of us wants them or expects them to be although some UDRP panels have already done so to prove the impossible (for example, in Educational Testing Services v. TOEFL, the panel seeking to establish bad faith said exercised its discretion by stating the following: “[…] because Respondent is contributing no value-added to the Internet – it is merely attempting to exploit a general rule of registration – the broad community of Internet users will be better served by transferring the domain name to a party with a legitimate use for it.”). But, some domain names are, on their face, registered for fair use. Take, for instance, <ihatebrand.com> - wouldn’t you consider use of such a domain name to fall under fair use? So, we find ourselves in a very bad conundrum – if the new gTLD program is meant to build bridges and invite applicants from across the world – developing countries included – then this approach will make it impossible. We need to understand and appreciate that not all registrants are bad actors who wish to take advantage of trademarks and we need to find ways to differentiate between those in good faith and those in bad faith. A good way would be to allow the Examiner, should she wishes to, to make determinations of good faith. The long-awaited interaction between the Governmental Advisory Committee (GAC) and ICANN’s Board of Directors wrapped up its proceedings today in Brussels, one day after the originally scheduled two day meeting. Trademark issues were once again at the forefront of the discussions with the ICANN Board providing some preliminary – and not final – answers to the GAC’s scorecard. For those who have not read or heard the trademark issues raised before the Board, the GAC scorecard focused on three issues relating to the protection of trademarks on the Internet: the Trademark Clearinghouse, the Uniform Rapid Suspension System (URS) and the Post Delegation Dispute Resolution Process (PDDRP). In my previous blog post, I identified the issues that I thought were problematic with the GAC scorecard, focusing mainly on the URS and the way it sought to provide a mechanism that would be beneficial for the trademark community and for no one else.
ICANN, in submitting its preliminary answers, got many things right, but also got some things wrong, whilst it referred some questions back to the GAC for more clarification. The ICANN Board emphasised that its inclination was not final and that further discussions with the GAC would be necessary to clarify and resolve the various outstanding issues. A further call between the GAC and the ICANN Board will be scheduled in the next few days (and before ICANN’s San Francisco meeting) to further discuss and deliberate on these issues with the hope that both entities will reach some agreement. Trademark Clearinghouse Regarding the GAC’s recommendation for all types of IP rights to be included in the Trademark Clearinghouse, the Board accepted in principle this proposal asserting, however, that further discussions were necessary to ensure that the implementation of this recommendation would not leave any rightful mark owners outside this framework. The Board accepted the recommendation that both sunrise services and IP claims should be mandatory and raised its objections on the issue of whether ‘IP claims services and sunrise services should go beyond exact matches to include exact match plus key terms associated with goods and services identified by the mark and typographical variations identified by the rights holder’. In relation to this, the Board expressed its difficulty in understanding and setting criteria as to how far the notion of these exact matches could go. One of the things that the Board focused on (and appeared to be quite adamant about it) is that only genuine trademark owners should be given the right to be listed in the Clearinghouse. By ‘genuine’ the Board asserted that proof of use on behalf of trademark owners should be required, expressing fears that various mark owners can potentially approach jurisdictions where no substantive review is conducted and, therefore, receive protection when it is debatable whether such protection should exist in the first place. Finally, in relation to who should bear the costs of sustaining the Clearinghouse, the Board asserted that trademark owners should pay a fee for registration, Registry operators should be required to pay a fee for using the services provided by the Clearinghouse and left open the idea that potentially registrants might bear some of the costs, since they will be using the Clearinghouse as a point of reference when registering a domain name. In their majority, these preliminary answers seem to be fine. The fact that the ICANN Board was not willing to straightforward accept the ‘exact match plus key word’ issue is a very positive step in limiting the rights that mark owners should enjoy in the Internet, just like in traditional trademark law. The Board was actually very reasonable in expressing its difficulty in understanding how such a provision would work, what criteria would apply and what would be boundaries be. Uniform Rapid Suspension System (URS) Regarding the URS, the Board’s preliminary answers were far more contentious. The Board accepted the GAC’s recommendation to reduce the timescales but did not deliberate on which specific ones this reduction would apply (the URS includes various timescales ranging from the time of response to the time of appeal). However, the Board did indicate that the system is meant to be ‘rapid’, indirectly indicating that there might be a reduction in the time for the response. The Board also accepted that there should be a standardised format for the submission of the complaint, which, from the GAC proposal, appears not to apply in the case of the response. The Board further accepted that a qualified ‘Examiner’ should adjudicate URS disputes, instead of panel appointments. The Board was once again adamant that proof of use of the trademark should also apply in the case for a successful URS proceeding and, further, asserted that even in default the Examiner should have to go through the process in delivering his/her decision. The Board, however, rejected GAC’s recommendation for lowing the standard of proof from ‘clear and convincing evidence’ to a ‘preponderance of evidence’, stating that the first lays somewhere in between the notions of ‘preponderance of evidence’ and ‘beyond reasonable doubt’ and, thus, it is only fair. The Board took also a negative view on the recommendation that the bad faith element should be abandoned (an issue that I personally felt should not have made it to the scorecard) and rejected the ‘loser pays’ model, which was controversial and would act as a deterrent for registering new gTLDs. The time for filing an appeal in default cases, which was originally set in 2 years, was accepted by the Board as appropriate and as complying with the wishes of the wider community. The Board also accepted that the fee for a URS proceeding should not exceed the amount of $300 and indicated its wish to allow transfer of the domain name after a successful URS. Finally, the Board rejected again the notion of extending exact matches to keywords. The worst aspect of the Board’s preliminary answer is the idea of allowing transfer of the domain name through a successful URS. As far as I am concerned, this recommendation stands no merit or justification and could in principle be the reason for the collapse of the whole URS. The initial justification of the URS was that it would be distinct from the UDRP as far as its remedies are concerned. Two distinct mechanisms with two distinct remedies: the UDRP would retain its remedial focus on transfer or cancellation of the domain name, whilst the URS would simply ‘lock’ the domain name. By allowing transfer of the domain name through a system intentionally not designed to proceed to substantive evaluation of facts, the need for the UDRP will slowly decrease. It should be anticipated that over time the URS will be used for every contentious issue, making the UDRP redundant. And, why shouldn’t it? If you are a trademark owner, of course you will opt for the cheaper (max. $300) and faster (the whole process will last substantially less than a UDRP process) system. And, if as I fear, the time of response is minimised to just 14 days, then ‘adios’ due process, procedural justice and balance. The way the Board decided to treat default is also quite problematic. The Board appeared to share the GAC’s (negative) view that default means bad faith and, thus, the defaulting party (the language used is ‘the non-cooperative party’) should not be given any privileges. Again, both the GAC and the Board misunderstand the idea behind default and take into consideration only the very narrow view. Not acknowledging that default might occur for various reasons and within various context will create problems for registrants residing in developing nations, for registrants with limited Internet access and for registrants who are not familiar with the ICANN administrative proceedings and need to find a lawyer to assist them. And, if the time for the response gets to 14 days, then all URS default cases (and they will be many but not for the reasons the trademark community suggests) will be automatically deemed as in bad faith. The Post Delegation Dispute Resolution System (PDDRP) This has been a great victory for Registries, which, in any case, they were not particularly thrilled with the concept of the PDDRP. The Board did not seem to agree with most of the GAC’s recommendations regarding the PDDRP, and asked for further clarification in some particular issues. The long-awaited GAC ‘scorecard’ on the protection of trademarks was released yesterday and, unfortunately, it did not come as much of a surprise. Following the direction that the USG ‘scorecard’ set in the beginning of the month, the recommendations of the GAC focus primarily on three rights protection mechanisms: the Trademark Clearinghouse (TMC), the Uniform Rapid Suspension System (URS) and the Post-Delegation Dispute Resolution Process (PDDRP). Although the recommendations for the TMC can objectively be negotiated as long as the official line remains that the creation of such a database will not confer any additional rights to right owners, it is the attempt of the GAC to change the substantive and procedural aspects of the URS that is of more concern.
The GAC’s advice in relation to the URS consists of the following elements: · The complaint should be simplified by replacing the 5000 word free text limit + unlimited attachments with a simple pro forma standardised wording with the opportunity for not more than 500 words of freeform text and limit the attachments to copies of the offending website. The idea of providing a standardised wording is not a good one, especially when it comes to disputes concerning two conflicting rights. Disputes vary both in nature and content and, despite the fact that the URS is meant to be used for those clear-cut cases of abuse, this recommendation is based on the arbitrary assumption that all types of disputes will inherently be the same. A standardised format will be detrimental in the delivery of justice. We need to bear in mind that a URS examination (in a similar manner to the UDRP) is based solely based on the documents submitted by the parties and panels make their determinations based on the content of these very submissions. How will a panel be allowed to make conclusive determinations if a standardised format is only permitted? I appreciate that the URS is meant to be used for those types of activities that on their face they appear egregious, but for the panel to determine the harmful activity parties should be permitted to produce their contentions, which will not be able to do if a standardised form is adopted. · Decisions should be taken by a suitably qualified ‘Examiner’ and not require panel appointments. Have we not learned anything from the UDRP and the potential bias that this recommendation will invite? If one thing is clear after ten years of UDRP adjudication is that the way panels are assigned to decide individual cases is highly problematic and that there is not a mechanism to hold panels accountable for the decisions they reach. When the same panellists are used, the possibility for bias becomes rife (http://www.dncrunch.com/?p=3199). But, at least the UDRP still operates on the basis that panels are assigned from a pool of panellists. Now, the GAC wants to make this rule redundant and suggests that a suitably qualified ‘Examiner’ will be deciding the case. This recommendation will make someone very rich and will allow the trademark community to ‘play’ and abuse the notion of adjudicators’ impartiality and independence. · Where the complaint is based upon a valid registration, the requirement that the jurisdiction of registration incorporate substantive examination should be removed This recommendation is reasonable to the extent that all trademark registrations, despite whether the jurisdiction granting them provides substantial review or not, can be subject to a URS process. This can prove to be disadvantageous for mark owners, whose jurisdiction requires a more substantive review, but at the same time respects the individuality of every trademark registration system. As long as mark owners that fail to get their trademarks in their own jurisdiction do not seek to play the system by attempting to register them in less-demanding jurisdictions, then this recommendation does not add much. · If, as expected in the majority of cases, there is no response from the registrant, the default should be in favour of the complainant and the website locked. The examination of possible defences of default cases according to para. 8.4 (2) would otherwise give an unjustified privilege tot eh non-cooperating defendant. This recommendation has two problems: first of all, it designs a system based on the presumption of default (“as expected in the majority of cases”). No one, including the GAC, can determine whether or how many defaults will take place; similarly, no one can possibly pre-determine the reasons for the default, which brings me to the second problem. Default does not always mean bad faith. Despite the efforts of UDRP panels to establish such a normative rule, the simple fact remains that default can be attributed to a variety of reasons and, unless they are exhausted, bad faith is not to be considered the main reason behind default. This provision will be highly problematic for those registrants that are located in remote and isolated areas, where Internet connections are neither as available nor as inexpensive. Especially, governments of developing countries should object to this provision, as their registrants might find it difficult to receive the complaint and respond in the limited time of 14 days, which is currently recommended. · The standard of proof should be lowered from ‘clear and convincing evidence’ to a preponderance of evidence. This recommendation makes me wonder whether the GAC has really considered its potential implications. A preponderance of evidence means that it is most likely that not that the fact that the complainant asserts is true. This means that even if there is an indication that a domain name might be infringing a trademark, then the URS can be activated; but, there also might be a possibility that this is not the case. Why then drag the registrant into this process based only on a possibility and not on a fact? This provision, coupled with the standardised form and the default, will ensure that a trademark owner will always prevail in the URS. · The ‘bad faith’ requirement in paras 1.2(f), 1.2(g) and 8.1(c) is not acceptable. Complainants will in only rare cases prevail in URS proceedings if the standards to be fulfilled by registrants are lax. Correspondingly, the factors listed in paras 5.7(a) (‘bona fide’) and b) ‘been commonly known by the domain name’ can hardly allow a domain name owner to prevail over the holders of colliding trademarks. What the GAC seems to be suggesting here is that no standards should apply for the determination of cybersquatting. If this is the case (and it appears to be so), then we are talking about a dispute resolution mechanism that will afford intolerable levels of discretion to the ‘Examiner’ to make final determinations. The GAC misunderstands the nature of the bad faith provisions. In the UDRP (and in similar proceedings) the complaining party carries the burden of proof, who has to prove that all three elements (identical or confusingly similar, no rights and legitimate interests and bad faith registration and use) are applicable. The list of bad faith factors is only indicative and is meant to provide the panel with some guidance as to how to determine bad faith. Now, the GAC wants to abandon this direction and give the freedom to the Examiner to make any determinations it wants without any guidance. This does not assist in the creation of a ‘Uniform’ system, but contributes to a system that will be based on arbitrary justifications and reasoning. Similarly, the GAC wants to jettison the ‘fair use’ provisions within the URS, the only tool at the disposal of domain name holders to prove legitimate rights on the domain name. And, the justification offered by the GAC is simply nonsensical. · A ‘loser pays’ mechanism should be added. This recommendation is problematic for various reasons. First and foremost, the URS is a rapid review process. It is not a full and robust review of the underlying facts. Conclusions are rapid, thus mistakes will inevitably be made. Losing the domain name is bad, but the financial consequences of a URS action on the registrant can be disastrous. The STI anticipates that a URS action will run about $500 — far cheaper than court, and about a third the price of a UDRP action. While this is considered a small amount of money for a large trademark owner, it is an enormous amount of money for a small businesses, an NGO, and an individual in any part of the world. A loss, even for a good faith registration, could be financial disastrous. The 'Loser Pays' is inherently pro-complainant, and would especially favor big brand complainants who can outspend any individual legitimate registrant. · There should be a clear rationale for appeal by the complainant. The time for filing an appeal in default cases must be reduced from 2 years to not more than 6 months. In addition, the examination of possible defences in default cases according to para 8.4 (2) means an unjustified privilege of the non-cooperative defendant. There are three issues that the GAC addresses here and all three seek to work only to the advantage of the trademark owner. a. The GAC suggests that the complainant should be given the right of an appeal: This would be fine, if both parties were subjected to the same deadlines and limitations. But, the truth is that complainants and domain name holders are asked to operate on completely different timeframes. The complainant, for instance, has all the time in the world to prepare the complaint before submitting it; the respondent has only 14 days to do what the complainant might have taken months to prepare. Moreover, the appeal process is meant to provide relief to the losing party and this is what the Applicant Guidebook suggests (12.1 Either party shall have a right to seek a de novo appeal of the Determination based on the existing record within the URS proceeding for a reasonable fee to cover the costs of the appeal). Why is it necessary to make such an explicit mention to the right of the Complainant to appeal? b. The time for filing an appeal in default cases must be reduced from 2 years to not more than 6 months: This reduction is arbitrary and too short. A good compromise would suggest for the filing of an appeal in default cases to be reduced from 2 years to not more than 1 year. c. In addition, the examination of possible defences in default cases according to para 8.4 (2) means an unjustified privilege of the non-cooperative defendant: Once again, the GAC here operates on the assumption that the reason for default is bad faith. Many respondents appear non-cooperative not because they are acting in bad faith, but because there are such provisions that indiscriminately equate default with bad faith, thus limiting the chances of a successful response. At the same time, what the GAC deems as non-cooperative, can be reasons for the respondent not being able to respond on time due to various technical or personal reasons. · A successful complaint should have the right of first refusal for transfer of the disputed domain name after the suspension period so that the complainant is not forced to pursue a UDRP proceeding to secure a transfer. The original justification of the URS as introduced by the IRT was that the distinct feature of the URS was its remedies. According to the IRT report:"The URS is intended to supplement and not replace the UDRP. They are separate proceedings with distinct remedies. The URS is designed to provide a faster means to stop the operation of an abusive site. The UDRP is designed to result in the transfer of the abusive domain name." Seeking to allow the transfer of the domain name under the URS becomes problematic at various levels. First of all, the whole foundation of the URS's justification (and the way it was 'sold' to the Internet community) collapses. Secondly, by allowing transfer under the URS a variety of issues emerge: what will be the compatibility between the URS and the UDRP? What will the differences be between the two mechanisms? If the URS is not meant to be a process that invites substantive evaluation but rather seeks to examine superficially the alleged infringement, then allowing a remedy that seeks transfer of the domain name is against due process and basic principles of justice. Finally, transfer of the domain name under the URS was never part of the original IRT recommendation. A Quick Recap:
In the last few years, ICANN has made huge strides in Protecting Trademarks within new generic Top-Level Domains (gTLDs). Now much more is being asked. Is it right? Is it appropriate? Will these changes make the new gTLDs unusable for the very communities we most hope will want them: developing countries, developing communities, new businesses, growing organizations and all the people born in the future? Since the beginning of the new gTLD discussion, protection of trademarks has been a priority, a goal, and an accomplishment. Prior to the new gTLD process, as trademark protection we had: • Uniform Dispute Resolution Policy (UDRP). Now, with the most recent Applicant Guidebook, we have multiple, new trademark protection mechanisms — far more than have ever existed before in any other context: • Uniform Dispute Resolution Policy (UDRP); • Trademark Clearinghouse — an enormous efficiency mechanism for trademark owners, allowing them to register their trademarks in one location, rather than reaching out to all new gTLD registries individually. The Registries must now work with this single source of trademarks, and ALL must have Sunrise Periods in the New gTLD; • Uniform Rapid Suspension system. The UDRP is much faster and cheaper than courts. But trademark owners wanted a system even faster and cheaper than the URDP. The Internet Community agreed to the URS, which is primarily designed to be faster and cheaper than the UDRP. But in its bottom-up, grassroots policy-making process, the ICANN Community required clear protections for registrants, including a fair time to respond (before a registrant loses its new business, product launch or human rights website). On demand from trademark owners, ICANN has already slashed response time to 14 days (making responses very difficult for non-English speakers and those without access to legal assistance). Now the current proposals for a "loser pays" model will break the system. Why would registrants even think to register in the new gTLD system when a $400 fee (approximately) could be a life-deteriorating result? This result will drive registrants away from new gTLDs, and the new opportunities they are designed to provide. • Post-delegation Dispute Process — This is the first time, we get to see a dispute resolution policy that will provide trademark owner with the ability to challenge the registry itself for abuse of the TLD. We, the ICANN Community, negotiated in good faith and at great length to balance the rights of trademark owners with the rights of all in commercial and noncommercial sectors, with the rights of all, now and in the future, to use normal, basic words and common last names, and new combinations thereof. Here are the problems associated with the existing proposals concerning trademark protection under the new gTLDs. I. Uniform Rapid Suspension (URS) procedure: This mechanism is designed to give trademark holders a cost effective, expedited process in instances of clear cut instances of trademark abuse. It was created by a group of trademark attorneys in the ICANN arena organized into a group called the "IRT Team." It was edited by a group representing all of the constituencies of ICANN, and the At-Large Community (ALAC) called the STI Team (Special Trademarks Issues). The STI accepted the URS concept, but added to it fairer notice and process. A. What did the STI Team add? • The STI increased the time of an answer from the registrant to 20 days (from 14). The concern is was that people need time to respond. Emails get lost in spam filters, non-English speakers need time to translate, registrants may need to seek out Counsel or assistance in responding to legal issues. Also, the ability of trademark owners to file their complaint at any time meant that many filings may take place at busy times of the year (Christmas, summer vacation). We hated to see a new businesses, much-publicized product launch, or timely human rights intervention taken down because the registrant did not have adequate time to respond. • This timing received 'unanimous consensus' within the STI and from ICANN's GNSO Counsel. • Unfortunately, ICANN staff has since cut the response time to 14 days, which will mean many registrants will "default" and not respond — likely losing their domain name. Now the current recommendations in the USG 'scorecard' propose a Loser Pays Model. This recommendation is problematic for various reasons. First and foremost, the URS is a rapid review process. It is not a full and robust review of the underlying facts. Conclusions are rapid, thus mistakes will inevitably be made. Losing the domain name is bad, but the financial consequences of a URS action on the registrant can be disastrous. The STI anticipates that a URS action will run about $500 — far cheaper than court, and about a third the price of a UDRP action. While this is considered a small amount of money for a large trademark owner, it is an enormous amount of money for a small businesses, an NGO, and an individual in any part of the world. A loss, even for a good faith registration, could be financial disastrous. The 'Loser Pays' is inherently pro-complainant, and would especially favor big brand complainants who can outspend any individual legitimate registrant. Why transfer of the domain name should not be part of the URS. The original justification of the URS as introduced by the IRT was that the distinct feature of the URS was its remedies. According to the IRT report: "The URS is intended to supplement and not replace the UDRP. They are separate proceedings with distinct remedies. The URS is designed to provide a faster means to stop the operation of an abusive site. The UDRP is designed to result in the transfer of the abusive domain name." Seeking to allow the transfer of the domain name under the URS becomes problematic at various levels. First of all, the whole foundation of the URS's justification (and the way it was 'sold' to the Internet community) collapses. Secondly, by allowing transfer under the URS a variety of issues emerge: what will be the compatibility between the URS and the UDRP? What will the differences be between the two mechanisms? If the URS is not meant to be a process that invites substantive evaluation but rather seeks to examine superficially the alleged infringement, then allowing a remedy that seeks transfer of the domain name is against due process and basic principles of justice. Finally, transfer of the domain name under the URS was never part of the original IRT recommendation. The STI contemplated on this issue, but decided against it. III. Trademark Clearinghouse One thing that deserves attention in relation to the Trademark Clearinghouse was that it was never meant to be characterized as a protection mechanism, at least in the same way the URS is meant to provide relief to trademark owners. The Trademark Clearinghouse was originally conceived as a means to provide efficiency in the domain name registration culture for both trademark owners, Registrars and Registries. One of the main features of the Trademark Clearinghouse is that it is not meant to allocate trademark rights where none exist in the offline world. Moreover, the Clearinghouse is expected to 'understand' and 'accept' the differences of trademark law across jurisdictions and respect them to the extent that it will not create more chaos than already exists. What Trademark + Keyword means: In the STI, we heard about many variations of domain names, and the addition of letters and stings to existing trademarks. The concern expressed was when the addition or removal of a letter changes the entire string — e.g., ENOM (a registrar), add "v" for VENOM (clearly unrelated). Similarly with GOOGLE and GOGGLE, two entirely different and distinct words. We stayed with, what I think was the IRT recommendation, of an exact match. IV. The Post Delegation Dispute Resolution System (PDDRP) The PDDRP is a novel and additional tool for trademark owners to protect their marks. The model is designed to allow trademark owners to turn against Registries, which appear to be encouraging or contributing cybersquatting activities. This new mechanism is extraordinary. It is the first time that we get to experience a mechanism that can potentially terminate an entire business, taking with it both legitimate and non-legitimate users. The PDDRP provides potentially the greatest weapon to the trademark community and, if not implemented and operated carefully, it can upset and work to the detriment of the whole registration culture. More importantly, though, the PDDRP manifests beyond any reasonable doubt that trademark protection in the Internet is more than secure. Concluding Remarks Why the recommendations of the Special Trademark Issues Team (STI) are good. Originally, the URS was conceived by the Implementation Recommendation Team (IRT) and when the STI was formed, the URS continued to constitute part of the Rights Protection Mechanisms. The STI was a multi-stakeholder group, which also included intellectual property owners and ICANN's Intellectual Property Constituency (IPC). The recommendations of the STI, therefore, sought to reflect all the various commercial and non-commercial interests and the recommendations it produced constitute a reflection of all the various positions. ICANN and the ICANN Community listened, and spent more time on this issue than issue than any other one in the new gTLD process. Balances were carefully crafted; interests were carefully weighed. The STI had outstanding lawyers and non-lawyers: from the Intellectual Property and Business Communities, from the Non-commercial and At-Large (individual) Communities, from the Registries and Registrars. We reached a fair and balanced compromise — one dramatically expanding the rights protection of trademark owners, yet balancing their rights with the rights of others. It is the way trademark law has always protecting existing TM owners, without infringing the rights of all who will follow. It is a good and a fair compromise. A way forward that will allow new gTLDs to succeed, not ensure their failure. It is the job of trademark owners to be vigilant, but it also is the responsibility of governments, ICANN and the entire Internet community to create a friendly environment for new entrants, to respect the fundamental principles of free speech, to provide choices and competition, and open new TLD options and possibilities to developing countries and communities, small businesses and entrepreneurs, and all the new services and products to follow. If you think that the issue of trademark protection in the new gTLDs was resolved, well you – like me – might be in for a big surprise. I knew that the recommendations of the Special Trademark Issues (STI) team were not at the satisfaction of the trademark community and I knew that trademark owners had approached ICANN’s Governmental Advisory Committee (GAC) as the last resort in actually getting what they wanted: overbroad, extra, uber(call it what you want, it is the same) protection for trademarks under the new gTLD programme. What, however, happened over the past few days and almost a month prior to the meeting between ICANN and the GAC is that the interaction between the GAC and the trademark community became more formalised and more institutional.
According to the World Trademark Review, the GAC has appointed UK’s GAC representative, Mark Carvell, ‘to collect community thoughts on this topic’. Now, here is the catch: repeating the same mistake the Implementation Recommendation Team (IRT) did almost two years ago, Mr. Carvell appears to have only summoned the industry in London last Friday to hear their views on what they would consider as an appropriate solution to the trademark conundrum. Vodafone, BBC, Richemont, BSkyB International and Shell were amongst the participants – and they all claimed that the only compromise they would consider would be going back to the IRT recommendations. To avoid any misunderstanding, the IRT is not a compromise nor should it be considered as such. I have repeatedly said that the problem with the IRT recommendation was that it was totally biased, disrespectful of the rights of legitimate domain name holders and users and an unnecessary document, parts of which were re-writing trademark law. In theory, I should not really care about what the trademark community is trying to do. The IRT is so very expansive of trademark rights that, if we were to go back to it, it would feed my research for many years. Ethically and academically though I have a big problem. I never advocated against protecting trademarks in the Internet and I have been in favour of putting forward policies that would cure the issue of cybersquatting – past, present and future. But, the IRT does so much more – it re-writes trademark law. Over the past couple of years, I have blogged about it, I have discussed it with colleagues and students, I have researched on it and all seem to point to the same direction: the recommendations of the IRT team were biased, unreasonable and against the fundamental principles of trademark law. Do you think it is accidental that courts and legislators do not make any mention on any of ICANN’s trademark polices? It is simply because these mechanisms that are promoted so vociferously by the trademark community are not in compliance with trademark law. Period! So, by rejecting the IRT, ICANN did something right – it at least said no to an expansive approach that is against legal theory and practice. And, by forming the STI, ICANN did another thing right – it put in motion its multistakeholder model and let the community, as a collective body, to decide. (And, before I am accused for saying this because I was a member of the STI, let me say that I say it because of that: I witnessed the effort, the negotiations and the exchange of ideas that took place within this multistakeholder environment. And the STI should be applauded for managing to reach conclusions that all stakeholders- including the Intellectual Property Constituency - signed on to). But, here is a question that keeps coming on my mind: why wasn’t a wider part of the community invited to the London meeting: academics that could talk about the law and registrants that could share their experience on the bullying they have to suffer from big and powerful brand owners? Why did only big and powerful brand owners make the cut? So, it is not really surprising that the discussion last Friday seemed to be going back to the IRT report. This whole process manifests one big problem: trademark owners have the money, the resources, the stamina and the political leverage to lobby, and lobby and lobby. Registrants on the other hand do not have the money or the resources to engage in such a campaign, but they do have the stamina. And, what is truly upsetting is that in reality, they actually get to lose much more than trademark owners – they get to lose their right to communicate undisturbed, they get to lose their right to express themselves freely and they get to miss the opportunity of entering the DNS, things that trademark law has so far protected from. Instead, what they get to gain is an unfriendly DNS, bullying and intimidation. So, here is an idea and I really hope it works: since legitimate registrants do not have the money or the resources to engage in endless lobbying, let’s use the Internet in order to make our voices heard. I would like to encourage everyone who agrees that we should not go back to the IRT and that trademark protection has been resolved through the STI recommendations, to sign on this blog post via the comments’ section. And, I promise that I will do my best to bring this to the attention of ICANN. |
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