Still insisting on a UDRP Review...

Over the past few months, there has been some buzz over the possibility of reviewing the Uniform Domain Name Dispute Resolution Policy (UDRP) – the oldest ICANN policy. On February 3, 2010, ICANN’s Generic Name Supporting Organization (GNSO) passed a resolution, requesting the ICANN staff to draft an Issues Report on the current state of the UDRP. According to the motion, this effort would focus on two issues:

·    “How the UDRP has addressed the problem of cybersquatting to date, and any insufficiencies/inequalities associated with the process; and,

·   Whether the definition of cybersquatting inherent within the existing UDRP language needs to be reviewed or updated. The Issue Report should include suggestions of how a possible PDP on this issue might be managed”.

This GNSO initiative back in February provided the excuse to all of us concerned with and researching the UDRP to start discussing possible ways for its review. And, its timing was perfect: the UDRP was celebrating just over ten years in the adjudication field of domain name disputes, discussions concerning the conflicting rights between trademark owners and domain name holders were fresh from the new gTLD process and ICANN had already made some movements towards a more efficient (electronic filling) and a more uniform (uniformity of supplemental rules across the providers) UDRP system.

The ICANN staff was directed to conduct a preliminary research on the status of the UDRP and submit its final recommendations to the GNSO. As it always happens with ICANN’s policies, the timeframe for this task was very short and, it looks like this short timeframe might have cost the UDRP a proper review. But, there were also other problems with this process: there was no clear methodology as to what this review should entail (aside from the two issues raised by the GNSO,) there was no clear direction what the aims of the review should be and, generally, there was a clear lack of understanding by the GNSO of what reviewing the UDRP entails, considering the massive body of case law that has been generated over the past ten years. So, it should really not come as a surprise that the ICANN staff found it impossible to deal in such a short time with the UDRP’s volume of cases, its substantial volume of documents (many of which go as far back as 1999) and, the great deal of academic (and not only) writing about the UDRP, its procedures and its substance. According to the ICANN staff: “Due to the tremendous volume of cases and materials available regarding the UDRP (including, over 300,000 hits on Google alone), it became clear that there was no effective way to evaluate these materials”.

Facing these difficulties, the ICANN staff – alongside the GNSO – opted for a ‘UDRP Webinar’ and a questionnaire that was sent to the various dispute resolution service providers. “The Webinar speakers were selected by the UDRP Drafting team based in part on recommendations from the UDRP providers. They reflected a broad cross-section of perspectives from various stakeholders with expertise in the UDRP and its administration, such as registrars, UDRP service providers, UDRP complainants and respondents, ICANN’s Contractual Compliance Department, and academics.”

As one of the academics invited to speak to this Webinar, I thought it was both successful and a great way to reach wide audiences. The Webinar attracted more than 100 participants and the chat application in the Adobe Connect room was flooded with ideas, questions and comments. The participants represented various interests and came from all sides of the spectrum: trademark owners, their lawyers, academics, civil society, domain name entrepreneurs, domain name businesses, etc. Each speaker was given 5-10 minutes to present their opinion, a very short but understandable timeframe, given the amount of speakers participating.

The Webinar gave all interested parties the opportunity to address their views on whether the UDRP should be reviewed. There was an overwhelming (and alarming my I add) majority of opinions against a review of the UDRP; some claimed that the timing was not right, others feared that a review would ‘break’ the UDRP whilst others felt that the mechanism, despite some flaws, is, generally, working well (for a more detailed account of these views see the ICANN Staff Preliminary GNSO Issue Report on the current state of the UDRP). On the downside, two hours proved not enough to even scratch the main problems with the UDRP; many questions by the participants were left unanswered and, to this end, ICANN could have sought ways to continue the discussions on the state of the UDRP and its potential review.

For reasons unknown, discussions on the state of the UDRP terminated after the Webinar and, on May 27, 2011, the ICANN Staff released its Preliminary Issues Report for consideration by the GNSO. The ICANN Staff report makes predominantly two mistakes: the first is that it considers the consistency and predictability of the UDRP as a good thing. To be sure, consistency and predictability can be considered positive elements in any system of adjudication as long as these are characteristics attributed to the procedural or institutional aspects of a system. But, in the case of the UDRP, predictability and consistency are connected with the winning rate of trademark owners. We all come to passively accept (how scary is that) that, depending on the provider, trademark owners will prevail in most of the cases. The second mistake is that we call the UDRP fair – I still don’t understand how we can reach such a conclusion without reviewing the UDRP and its case law to see how fair or unfair the system has been operating for the past ten years.

Unsurprisingly and disappointingly, the Preliminary Report recommends that “although properly within the scope of the GNSO’s mandate, a PDP on the UDRP not be initiated at this time”. The Report states that “after carefully evaluating the issues and concerns expressed by the ICANN community regarding the UDRP, Staff has concluded that many relate to process issues associated with the implementation of the UDRP, rather than the language of the policy itself”. This is partly true – indeed the majority of the issues identified have to do with the procedural aspects of the mechanism, but that doesn’t mean that these cannot be used as a justification for a review. At the same time though, the language issues of the UDRP – even the few ones if you wish – are very important and extremely necessary for the healthy existence and continuance of the UDRP (e.g. the lack of clear fair use provision is a language issue that needs to be addressed. Actually, the UDRP is one of the few such policies that has not made room for such language). Similarly, the argument that not many UDRP decisions have reached courts should not be used as a justification against its review. Let’s not forget that traditional trademark litigation is associated with huge costs. Nowadays, registering a domain name costs as little as $10 – how many registrants who own non-commercial domain names are willing to engage in lengthy and very expensive trademark litigation? Needless to say that in the majority of the court cases, the UDRP is not acknowledged as a system able to produce conclusions worthy of court consideration (see, for example, Parisi v. Netlearning, Inc., the Barcelona.com court cases, and Sallen v. Corinthians Licenciamentos Ltd.)

I have always advocated, and will continue to advocate, for a review of the UDRP. It is not only reasonable but necessary. The UDRP is more than ten years old. It started as a system that was meant to address the issue of cybersquatting and abusive domain name registrations and has expanded to the extent of addressing almost every contentious issue of trademark law in the online environment. That makes the UDRP some sort of an international trademark law statute, which has not been legitimised through the channels of public international law. And, this is not necessarily a bad thing, as long as we make sure that UDRP is a balanced system, respects equally both conflicting rights and their owners and is adjusted to take into consideration the changing use and purpose of domain names. At the very minimum, the UDRP should recognise domain names as articles of innovation, creativity, entrepreneurship and new business models; it also should recognise the limitations of trademark law, its boundaries and doctrines as well as its fundamental principles concerning the nexus between commercial and non-commercial speech. These are not just decorative adjustments that we can live without; these constitute essential components contributing to the legitimacy and health of the UDRP.

In my book, ‘The Current State of Domain Name Regulation: domain names as second-class citizens in a mark-dominated world’, I have identified some issues within the UDRP that contribute to its procedural unfairness.  Here is a very quick breakdown:

· The UDRP fails to account for a process that consists of checks and balances and is not consistent with due process;

·  The UDRP does not provide incentives, equal for both parties;

·  The UDRP promotes forum shopping;

· The panellists associated with the UDRP have mainly a trademark law background;

· The number of default cases is worryingly high;

· The democratic fractions of the UDRP are weak and incapable to resist trademark penetration;

· The UDRP makes arbitrary use of precedent.

Similarly, the UDRP also promotes an inconsistent system, despite the fact that is meant to be uniform.

· The UDRP is based upon the illogical conclusion that all domain name registrations are potentially abusive and harmful and, occasionally, without any distinction or assessment between actual harm and the likelihood of such harm, it has normatively evolved into an inconsistent paradigm;

· The substantive provisions of the UDRP (paragraph 4a) are at best etymologically obscure;

· The bad faith element is open to wide and discretionary interpretations;

· There is no authority responsible for the decisions (good or bad) that come out of UDRP panels.

Given the fact that there is such speculation (more of a certainty for some, like myself) concerning the substantive and procedural deficiencies of the UDRP, many of these issues could have been addressed via a review process. At the same time, new additions in the UDRP could make this mechanism more efficient, more pragmatic and healthier; here are some recommending ideas:

· The UDRP could introduce a statute of limitations for domain name disputes, disallowing trademark owners from initiating complaints against gTLDs that have been registered more than one year previously;

· The UDRP could introduce a ‘Random Centre Generation’ system, so as to eliminate issues of forum shopping;

· The UDRP should re-evaluate the scope of the bad faith element;

· The UDRP should discourage panels from making use of precedent (at least under the current function of the UDRP);

· The UDRP should clarify and elucidate on the benchmarks domain name registrants would have to meet in order to convincingly demonstrate their rights and legitimate interests in a domain name;

· The UDRP should incorporate clear safe harbours, following other similar dispute resolution policies, such as NOMINETs’s or the URS;

· The UDRP should make room for an internal appeals process, which would cure much of the UDRP’s inconsistency, and correct bad decisions;

· The UDRP should insert a three-member blanket rule across all disputes;

· The UDRP should insert strict and specific penalties against trademark owners engaging in Reverse Domain Name Hijacking and trademark bullying.

· The UDRP should provide registrants with the possibility of initiating a UDRP dispute.

These are just some of the features that, if incorporated or – at the very minimum addressed – will assist in creating a system that is procedurally and substantively more fair and balanced. Let’s not forget that, contrary to what we now accept, back in 1999, the UDRP was not a consensus document. It was a policy, created by the trademark community, which, at the time, was given the right to design a mechanism for addressing cybersquatting; I don’t like placing bets personally, but I would bet that, in its current form and design and with the knowledge we now have, the UDRP would face strong opposition from the community, SMEs, entrepreneurs and innovators. And, let’s not kid ourselves: the UDRP was and is subject to trademark politics – a system that is initiated by the trademark community, is run by the trademark community and its future depends on the trademark community can only be based on trademark politics.

Before I close this blog post, I have to make one thing clear – I, and all the critics of the UDRP, are not against the concept of having the UDRP or against the protection and securitisation of trademarks both online and offline. Trademarks have to be protected against such issues as cybersquatting and the UDRP constitutes a vehicle towards achieving this goal. However, any protection of trademarks should not prohibit us from contemplating those provisions that are built around and within trademark law and ensure its adherence to concepts of legality and legitimacy. I am referring to issues of fair use, consumer protection and choice (the one based on allowing consumers the choice to determine whether they are confused and not the one directed by what the trademark community considers as confusion), freedom of speech and competition. The UDRP is not any system. Having spent the past ten years evolving and learning from its own processes and the cases that have appeared before its panels, the UDRP is a mechanism that can truly be inclusive. And, I don’t mean here to devalue courts and their procedures. But, the fact of the matter is that the UDRP is cheap, which makes it affordable for everyone, and it is fast, which ensures that in a fast-paced economic environment, like the Internet, is able to provide quick answers.

So, for better or worse, we are stuck with the UDRP. And, because we have to live with it, we also need to make sure that it is structured in such a way as to provide balance, fairness and due process. I am not sure we fully appreciate the power and strength of the UDRP and the implications this power has upon the commercial and non-commercial Internet. I am not sure we understand the limitations of the UDRP, the fact that this dispute resolution mechanism was never meant to replace the traditional strands of trademark law or to create new legal rules that will apply in the online environment. Here we are then, stuck with an amorphous system of rules that produces inconsistent decisions, a system of rules that institutionally does not adhere to any of the legitimate archetypes, be it arbitration or a ministerial system and one that has not followed any of the existing international law processes, despite the fact that its behaviour and status demonstrate signs similar to international law making.

Both at the UDRP Webinar and the ICANN staff report, it appears that one of the main fears against initiating a UDRP review seems to concern the fragility of the UDRP and the possibility of the UDRP collapsing if we proceed to its review. This is an artificial fear. We should really consider the possibility of how the UDRP might collapse as a system if it is not reviewed.