Rights protection mechanisms review: the future of enforcement?
The Internet Corporation for Assigned Names and Numbers (ICANN) is the organisation that coordinates global policy and technical implementation regarding the Domain Name System (DNS). ICANN has implemented a number of trademark rights protection mechanisms (RPMs) designed to facilitate individual brand owners’ ability to protect their trademark rights in the DNS and, as a result, protect consumers. The ICANN mechanisms are designed to minimise the need for trademark owners to seek relief in court.
Prior to 2012 the DNS contained just 22 generic top-level domains (gTLDs). In 2012 ICANN launched an expansion of the gTLD space that has led to the addition of hundreds of gTLDs (eg, ‘.clothing’ and ‘.bank’). This expansion has created an unprecedented scale of online enforcement challenges for brand owners.
Before the 2012 expansion, the sole ICANN RPM was the Uniform Domain Name Dispute Resolution Policy (UDRP). Recognising the expansion created additional burdens, the ICANN community developed new RPMs, including the Trademark Clearinghouse, which facilitated:
- the sunrise and claims RPMs;
- the Uniform Rapid Suspension (URS) system; and
- the Trademark Post-delegation Dispute Resolution Procedure (PDDRP).
In 2016 ICANN committed to performing a review of all RPMs before launching any further gTLD expansions. This process will likely shape the RPMs for many years to come, so it is important that the community gets it right – in particular, ensuring the viability and utility of these mechanisms for brand owners without compromising legitimate domain name registrations in good faith. The continued availability of RPMs will further the goal of minimising the need to resort to cumbersome and expensive litigation, benefiting all parties.
RPMs under review
The Trademark Clearinghouse is a centralised repository of validated trademarks, which can be used to participate in sunrise and claims. It contains approximately 45,000 trademark records. Entry into the Trademark Clearinghouse facilitates the sunrise and claims services.
Trademark Clearinghouse questions under discussion include:
- Should there be an additional or a different recourse mechanism to challenge rejected trademarks?
- Should further guidance be considered on the Trademark Clearinghouse verification guidelines for different categories of mark?
- Should the Trademark Clearinghouse matching rules be expanded (eg, to include plurals, ‘marks contained’ or ‘mark+keyword’, and/or common typos of a mark)?
The Trademark Clearinghouse’s functionality is critical, as it can affect the proper operation of the other mechanisms. In short, brand owners generally agree that:
- no additional recourse is needed to challenge marks rejected from the Trademark Clearinghouse;
- further guidance on Trademark Clearinghouse verification guidelines is likely to be unnecessary, but any ambiguities could be identified and improved; and
- the matching rules should be expanded to include plurals, marks contained and marks+keyword, at least for the purposes of the claims service.
Sunrise services allow trademark owners an advance opportunity to register domains corresponding to their marks before names are generally available to the public. All new gTLD registry operators must provide sunrise for at least 30 days prior to making the gTLD publicly available.
The most recent data from May 2015 indicated that sunrise registrations constituted only about 1% of all new gTLD registrations. Recent survey data has also identified that brand owners have not been participating due to the unexpectedly high cost.
Sunrise questions under discussion include:
- Is the notion of ‘premium names’ relevant to a review of RPMs and, if so, should it be defined across all gTLDs?
- Should there be a specific policy about the reservation and release of reserved names (eg, modification of Section 1.3.3 of Specification 1 of the current Registry Agreement)?
- Should owners of Trademark Clearinghouse-verified trademarks be given a right of first refusal once a reserved name is released?
- Should sunrise periods continue to be mandatory and, if so, should the current requirements be more uniform (eg, a 60-day period for all TLDs)?
In short, brand owners would support:
- potential expansion of sunrise to cover non-exact matches (eg, common misspellings or mark+keyword);
- mechanisms to challenge a premium name designation attached to a Trademark Clearinghouse-recorded mark;
- a policy preventing circumvention of sunrise through reservation and post-sunrise release of sunrise-eligible domains and/or a right of first refusal on post-sunrise release of a reserved name matching a Trademark Clearinghouse-recorded mark;
- continued mandatory sunrise periods using a uniform 60-day minimum period;
- mechanisms to challenge other registry or registrar practices that circumvent sunrise; and
- additional efforts to improve the transparency around launches of sunrise periods and sunrise registration pricing.
Unfortunately, ICANN has consistently stated that it will not act to regulate new gTLD pricing, so it is unclear whether the RPM review can make meaningful recommendations for a policy to control sunrise pricing practices.
The trademark claims service follows the sunrise period. It is a notification service mandated by ICANN for all new gTLDs to warn both domain name registrants and Trademark Clearinghouse-recorded trademark owners of possible infringements. A potential registrant gets a warning notice when attempting to register a domain name that matches a trademark recorded in the Trademark Clearinghouse. If, after receiving and accepting the notice, the registrant continues with registration, the trademark owner receives a notification of the registered name, so that it can take any appropriate enforcement action. All new gTLDs must implement the claims service for at least the first 90 days of general availability of the gTLD. However, the Trademark Clearinghouse itself offers an ongoing claims service where Trademark Clearinghouse-recorded mark owners can continue to receive notifications of the registered name in perpetuity.
Recent survey data suggests that claims notices were not a major deterrent to registration – potentially because registrants did not fully understand or appreciate the legal significance of the notices, or because bad-faith registrants were determined to continue with registration regardless of such notices.
Trademark claims questions under discussion include:
- Should the trademark claims period be extended beyond 90 days?
- Does a trademark claims period create a potential chilling effect on genuine registrations and, if so, how should this be addressed?
- Is the Trademark Clearinghouse providing too much protection for trademarks of a generic or descriptive dictionary word, thus allowing a trademark in one category of goods or services to block or postpone the legitimate and rightful use of all others? Are legitimate non-commercial, commercial and individual registrants losing legitimate opportunities to register domain names in new gTLDs?
- How can the Trademark Clearinghouse provide education services for trademark owners, registrants and potential registrants which are all equally affected by the Trademark Clearinghouse and supported RPMs?
In short, brand owners support:
- preserving trademark claims as a mandatory RPM for all open gTLDs;
- removing mandatory trademark claims service for closed gTLDs;
- obtaining extended or even perpetual claims services for all open gTLDs; and
- continuing the TM+50 (‘previously abused label’ service), but obtaining reduced costs and administrative burdens.
Brand owners oppose efforts to limit the trademark claims service based on goods and services of the underlying Trademark Clearinghouse-recorded mark, given that many gTLDs have no specific goods or services nexus.
Uniform rapid suspension
URS is a helpful, albeit underutilised, complement to the UDRP for clear-cut instances of infringement through bad-faith registration and use of domain names. It is intended as a faster and cheaper alternative to the UDRP, with the remedy of temporary suspension of an abusive domain name. The burden of proof is higher, concomitant with theoretically lower due process requirements.
To date, a total of about 800 URS cases have been filed, covering approximately 1,800 domain names. In the same period, there have been about 11,500 UDRP cases filed with the World Intellectual Property Organisation alone. Complainants prevailed in about 88% of URS cases, similar to the 85% success rate under the UDRP.
The RPM Review Policy Development Procedure Charter includes a specific list of questions:
- Is the URS’s clear and convincing standard of proof appropriate?
- Is there a need to develop express provisions to deal with repeat offenders, as well as a definition of what qualifies as ‘repeat offences’?
- Should the URS allow for additional remedies such as a perpetual block or other remedy (eg, transfer or a right of first refusal to register the domain name in question)?
- Should there be a ‘loser pays’ model and, if so, how can that be enforced if the respondent does not respond?
- How can the appeals process of the URS be improved?
In short, brand owners would support certain reasonable enhancements to the URS or, at a minimum, preserve the status quo. Some proposals to enhance the URS have included:
- instituting a ‘loser pays’ cost-allocation model;
- creating certain modestly enhanced penalties for repeat offenders or those engaging in high-volume cybersquatting;
- providing further extensions of the suspension period as an enhanced remedy; and
- eliminating the post-default de novo review period and replacing it with a longer period in which to file a URS appeal.
It will also be important for brand owners to oppose efforts to weaken the URS, including specific proposals such as:
- introducing a filing limitation period tied to the creation date of a domain name;
- introducing a standard where if a court finds that a registrant has no cause of action to bring an appeal of an adverse URS ruling in that jurisdiction, the URS decision will be vitiated;
- introducing a mandatory mediation step as part of the URS process; and
- eliminating the URS altogether as a mandatory RPM.
Trademark Post-delegation Dispute Resolution Procedure
The PDDRP is designed to address a registry operator’s complicity in trademark infringement by facilitating the registration of infringing domain names within its TLDs. PDDRP complainants are required to prove, by clear and convincing evidence, a substantial pattern or practice of specific bad-faith intent by a registry operator to profit from the systematic sale of trademark-infringing domain names.
The RPM Review Policy Development Procedure Charter was tasked with examining the PDDRP, although its review was quite restricted insofar as no complaints have been brought to date. Although some notable operational fixes and clarifications have been agreed (eg, an explicit right to file a joint complaint by multiple unrelated trademark owners), there is little appetite to perform a deeper review of this mechanism in light of its non-use. This begs the question as to why the mechanism has not been used to date. Most likely, the standard of proof is too high and the vast majority of registry operators – even those arguably operating in bad faith to take advantage of trademark owners – would still prevail.
The UDRP is the first ICANN Consensus Policy, adopted as an arbitration-style mechanism for resolving disputes concerning bad-faith registration and use of domains targeting trademarks. The mechanism was intended as a cheaper alternative to litigation often costing thousands of dollars to recover a domain name registered for a few dollars by a cybersquatter. The UDRP is considered to be the crown jewel RPM, successfully applied in nearly 80,000 cases, with brand owners winning back wrongfully registered third-party domains approximately 85% of the time.
Many in the domain name investor community feel that the UDRP is unfairly biased in favour of trademark owners. They view the RPM Review Policy Development Procedure Charter as their golden opportunity to dilute the UDRP. This approach largely ignores the historical development of the UDRP, which included free speech and registrants’ rights advocates who built in key protections for legitimate, good-faith interests and fair uses of domain names as reflected in the very language of the UDRP itself. It also ignores the benefits of the arbitration mechanism that keeps all parties out of court.
UDRP questions under discussion include:
- Should there be a time limit for complainants to bring UDRP complaints?
- Should the UDRP elements refer to registration “or” use in bad faith, rather than the current standard of registration “and” use in bad faith?
- Should there be a ‘loser pays’ cost-allocation system?
- Are enhanced penalties needed for either repeat offenders or complainants found to be engaging in reverse domain name hijacking?
Ultimately, it is the view of many brand owners that the UDRP is working quite well, and the primary goal of any review should be to preserve the status quo. Of course, it may be beneficial to also entertain a number of key enhancements, such as a ‘loser pays’ cost-allocation model and enhanced penalties for serial cybersquatters, which would act as further deterrence. Many of these concepts have been discussed in the context of the URS and are likely to be reprised during the UDRP review.
The brand owner community is already ramping up efforts in terms of developing advocacy positions and strategies tied to the specific charter questions.
ICANN RPMs versus other enforcement options
Traditional approaches include:
- cease and desist letters;
- notice and takedown letters to web hosts; and
- similar abuse reporting letters to registrars and registry operators.
However, these approaches have become challenging as a result of recent privacy laws that have precipitated substantial redactions in public domain name registration data, making it harder to identify and contact domain name registrants directly. As a result, more letters are being addressed to intermediary service providers, often without any adequate results (eg, suspension or cancellation of a problematic domain). While recalcitrant registry operators and registrars can be reported to ICANN’s contractual compliance department, there is little appetite to penalise those service providers.
Litigation remains the ultimate option for addressing online enforcement issues. Under US law, in particular the Anti-cybersquatting Consumer Protection Act, trademark owners can obtain injunctive relief and damages in connection with domain names that were registered or used in bad faith to unfairly trade on the goodwill of a third-party trademark. The domain name itself may be subject to in rem jurisdiction in the United States, so long as a registration authority associated with the domain name is under US jurisdiction. Nearly all legacy gTLD registry operators are located within the United States, as well as many longstanding registrars. However, since the new 2012 gTLD programme there are more non-US registries and registrars, undermining the Anti-cybersquatting Consumer Protection Act’s overall effectiveness. In many cases, domain names are beyond the reach of US law where the registrant, registrar and registry operator are all non-US entities.
Because of the emergent limitations in the reach of national legislation designed to combat cybersquatting and related domain name abuse, as well as recent privacy laws that have led to the blackout of key domain name registration data used to identify and contact bad actors, ICANN RPMs (including in particular the UDRP and even the URS) have never been more important than they are today. Thus, it is critical for brand owners to pay close attention to the ongoing RPM Review and engage and advocate to protect and preserve these important mechanisms. If the brand owner community should falter, the opportunity is ripe for other contrary interests to effectuate potentially long-lasting and devastating policy changes that could weaken these mechanisms for decades to come.