In order to be able to reply to the question of whether a new set of governance mechanisms are necessary to regulate the new Global Top Level Domains (gTLDs), one should first consider how efficiently the current Uniform Domain-Name Dispute-Resolution Policy (UDRP) from the Internet Corporation for Assigned Names and Numbers (ICANN) has performed and then move to the evaluation of the Implementations Recommendations Team (ITR) recommendations. In September 2008, an analysis of the opportunities and problems for trademark owners presented by the introduction of new gTLDs [1] was published in the Trademark World magazine.

That analysis identified several brand protection challenges such as the absence of required pre-launch rights protection mechanisms (RPMs), the problems of defensive registrations, and the unprecedented potential for cybersquatting [2]. According to Kristina Rosette [3] an Intellectual Property Constituency Representative to the ICANN’s Generic Name Supporting Organization (GNSO) Council and ex-member of the Implementation Recommendation Team, ICANN has made little advancement on the issue of trademark protection in the new gTLDs despite the efforts of numerous trademark owners, associations, and lawyers.

Issues with the UDRP

In February 2010, the ICANN GNSO council passed a resolution [4], requesting ICANN staff to draft an Issues Report [5] on the current state of the UDRP. According to that motion, the draft had to focus mainly on issues of:

— How insufficiently and unequally has the UDRP addressed the problems of cybersquatting;

— Whether the definition of the term ‘cybersquatting’ needed to be reviewed or updated in the existing UDRP language including a possible revision of the policy development process. In his book [6] ‘The Current State of Domain Name Regulation: domain names as second-class citizens in a mark-dominated world’, Dr. Komaitis has interestingly outlined some of the major issues related to the UDRP, which have commonly contributed to its procedural unfairness. Some of those issues [7] can be broken down to:

• The panellists associated with the UDRP have mainly a trademark law background which is not sufficiently oriented to the multi-stakeholder approach;
• The UDRP makes arbitrary use of precedent. One unique feature of the emerging arbitration process under the UDRP has been the development of its own jurisprudence. While most arbitration is done with little, if any, public disclosure, the publication of UDRP opinions on the Web, has led to a practice of citing back to previous panel decisions. Some decisions have used the previous cases with only the weight of persuasive authority, while others appear to view themselves as being bound by precedent. In several cases, panels have used opinions from previous cases as persuasive authority to help address a variety of procedural and substantive matters. For example, J.P. Morgan v. Resource Marketing (jpmorgan.org) D2000-0035 [8] was a dispute involving an American Complainant and an American Respondent. The Respondent’s reply was late and the Complainant argued for the inadmissibility of the late response (the Complainant cited Talk City, Inc. v. Robertson (talk-city.com) D2000-0009 [9] as precedent for this position).
• The UDRP is based upon the assumption that all domain name registrations are potentially abusive and harmful without any distinction or assessment between actual harm and the likelihood of such harm. In practice, this is not always the case.
• There is no authority responsible for the validation of the decisions that emerge from the UDRP panels.
• The bad faith element is open to wide and discretionary, if not discriminatory, interpretations. Trademark attorneys were initially concerned by the UDRP’s badfaith use requirement because under US trademark law, “use” meant that the domain name had to be “used in commerce” [10]. Three of the four factors outlining bad faith do not require any use per se, at least as defined in common parlance, and many of the early decisions under the UDRP have similarly found bad faith in the absence of any traditional use of the domain, indeed even in the absence of an active website. For example, in the first case decided under the UDRP, World Wrestling Federation, Inc. v. Bosman (worldwrestlingfederation.com) D99-0001 [11], the Panel resolved that an offer to sell amounts to “use” of the domain name, even if that offer constitutes the Respondent’s only use of the name. In short, an offer alone may constitute “use” sufficient to merit a finding of bad faith—a finding cited as authority in numerous subsequent cases.

The UDRP promotes an inconsistent system, despite the fact that it is meant to be uniform. The worryingly high number of default cases requiring UDRP intervention can demark this [12]. At the same time the UDRP does not provide equal incentives to both parties. Given the fact that there is such speculation concerning the substantive and procedural deficiencies of the UDRP, many of these issues could have been addressed via a review process. However, many ICANN community members believed that this is not the best time to review the UDRP. WIPO’s Erik Wilbers [13] said “Irrespective of one’s views on its functioning, the UDRP must interoperate with other RPMs being developed for New gTLDs”

Enter the ITR Recommendations

In 2006, the ICANN Board officially authorised the expansion of the Root and the addition of new gTLDs. To support this process ICANN formed the IRT, which in return produced a report in 2009. A significant part of that program focused on what types of Rights Protection Mechanisms (RPMs) should be in place for intellectual property holders and particularly for trademark owners. After several meetings, teleconferences and consultation with various interest groups the ITR came up with several draft recommendations for several proposed solutions consisting of the following potential mechanisms, to which they assigned high priority [14]:

1. Trademark Clearinghouse,
2. Globally Protected Marks List (GPML) and associated Rights Protection Mechanisms (RPMs), and standardised pre-launch rights protection mechanisms;
3. Uniform Rapid Suspension System (URS);
4. Post-delegation dispute resolution mechanisms;
5. Thick WHOIS requirements for new TLDs;
6. Use of algorithms in string confusion review during initial evaluation.

Out of the above solutions the Internet, Intellectual Property and the trademark related communities have majorly shown concerns and reacted specifically to:

• Trademark Clearinghouse (often referred as IP Clearinghouse)—started the trademark validation services [15] on 26 March 2013
• Globally Protected Marks List (GPML) - The trademark Clearinghouse is charged with validating all data regarding the GPML application [16]. Once the Clearinghouse finishes with the validation and compiles the initial GPML, ICANN publishes it before the request for proposal or RPF issues. This publishing by ICANN is done beforehand so that there are no potential applicants trying to register a protected mark.
• Uniform Rapid Suspension System (URS)—a rights protection mechanism that complements the existing Uniform Domain-Name Dispute Resolution Policy (UDRP) by offering a lower-cost, faster path to relief for rights holders experiencing the most clear-cut cases of infringement.

Evaluating the ITR recommendations

The Trademark Clearinghouse

The IP Clearinghouse would be a centralised database with two principal functions:

1. A central database for all new gTLD registries (and possibly registrars) to interact with, in relation to GPML, IP Claims, and URS; and
2. Information repository for specific information collection and data validation services. Trademark owners would submit data about their trademark rights [17], and the IP Clearinghouse would authenticate that data.

It could then push the authenticated data to new gTLD registry operators, or those registry operators could pull the data to support pre-launch RPMs, the GPML, and the URS. The IRT intended the IP Clearinghouse to introduce efficiencies for trademark owners, new gTLD registries, and registrars. Most comments on the IRT Final Report either supported or did not object to the IP Clearinghouse recommendation [18].

It seems beneficial to have an organisation that operates to reduce the time and money [19] necessary for brand owners to register in and police the new TLD space. The IP Clearinghouse would be tasked with supporting applications such as the Watch Service, IP Claims Service, Uniform Rapid Suspension System (URS) and Globally Protected Marks List. As a result, the IP Clearinghouse would not only require certain types and levels of expertise, but would also probably be a for-profit organisation, in such case the intriguing questions to ask would be:

• How would such an organisation be able to provide low-cost mechanisms and demonstrate the proper level of expertise?
• How would registries and registrars be indemnified for using the Clearinghouse?
• What would be the source for any such indemnification, and how would it be funded?
• What frequency of IP clearinghouse updates would registries need to check, daily or real time?
• If a registry elects to use the IP Clearinghouse on an on-going basis and not just for pre-launch activities, how will the IP Clearinghouse support registry operations
• without impacting Service Level Agreements (SLAs) or registry performance?
• Will ICANN renegotiate all SLAs for query times to account for these processes?
• What provisions will be made if use of the Clearinghouse causes registries to default on SLAs?
• Would registries be required to send a query to a centralised database for every new registration request, potentially impacting registry and registrar operations as well the customer experience?
• What would happen when the clearinghouse is not accessible?
• Would new registrations have to cease? (Resulting in potentially significant consequences.)
• What would the new role of relationships between registries, registrars and the Clearinghouse be? Would a registry have the relationship with ICANN, and ICANN have the relationship with the Clearinghouse?

The final report does not address the issue of archiving of the IP Clearinghouse data, as it will be handy that historical archives of the data be maintained and accessible. Also, specific requirements for this should be specified including a definition of access rights.

The Globally Protected Marks List proposals

The IRT recommended the creation of a GPML to provide additional protections for Globally Protected Marks (GPM) at the top and second levels. The IRT recommended strict eligibility criteria for the GPML:

1. Ownership by the trademark owner of [number][20] of trademark registrations of national effect for the applied-for GPM that have issued in at least [number] countries across all five ICANN geographic regions with minimum number of registrations in each region;
2. All trademark registrations must have issued by the date that GPML applications are first accepted and must be based on trademark registration applications filed by 1 November 2008; and
3. Second-level domain for GPM’s principal online presence must be identical to GPM.

At the top level, the IRT recommended that applied-for gTLD strings be analysed for confusing similarity against GPMs, and that an application found to be an identical match or confusingly similar to a GPM would fail. A failed application could not proceed unless the applicant prevailed in an Initial Evaluation Reconsideration process, which would be available to all applications that failed the string confusion analysis. An applicant could prevail by demonstrating either that an applied-for TLD string is not sufficiently similar as to be likely, as a matter of probability and not mere possibility, to deceive or cause confusion or that it otherwise has legitimate rights to use the applied for TLD.

At the second level, the IRT recommended an initial block of second-level domain names that are an identical match to the GPM. However, a potential registrant of an initially blocked domain name could register the name, if it could show, using the criteria of the UDRP, that it had a right or legitimate interest in the domain name. Furthermore, some of the major problems that the GPML can raise are as follows:

• The GPML will exorcise certain words from the DNS as it promotes protection of strings of characters, rather than protection of the mark [21] and its association with goods or services;
• The GPML will create an alternative, new category of trademarks that do not fall within the famous/well-known category;
• The GPML will include very esoteric scientific and technical terms that are currently used worldwide
• The GPML overrides the fundamental legal principle that only courts can determine whether a mark qualifies as “famous”;
• The GPML will help a trademark owners elevate the status of their trademarks to the protection of “text strings” not trademarks;
• The GPML will not favour consumer protection and the same time it will violate a fundamental norm of Free Speech and Freedom of Expression via the prohibition on its ‘prior restraint’

The IRT developed the GPML in response to the most frequently proposed trademark protection solution “A-list”. However, the GPML was likely the most frequently criticised IRT recommendation [22]. Some criticised the GPML for being a “famous marks list”, some criticised it as being too political, some criticised it as likely to generate problems far out of proportion to the benefits, and some criticised it because the IRT Final Report did not provide definitive eligibility criteria.

The IRT had asked ICANN staff to conduct the quantitative research necessary to propose eligibility criteria because the IRT did not have time, and did not want to be accused of bias. Although ICANN staff agreed to do so, ICANN staff later acknowledged in late October 2009 that the research had not been completed [23].

According to Professor McCarthy, all assumptions need to be proven in order to justify extra protection. He suggests that consumers are not so easily confused and he presents the very interesting example of Amazon to show that, although Amazon can be considered a famous mark that does not imply that it is worthy of extra protection against all other uses. Amazon can mean different things (the great river basin of South America and Greek women warriors), which makes it not an arbitrary mark. If someone needs to know where to acquire Amazon food, Amazon drinks, Amazon Gyms, for example, this does not automatically mean that Amazon should be able to block its use on the basis of fame. The GPML will create even more problems for generic terms, such as TIME, PEOPLE, FORD, SHELL, and many others.

The Uniform Rapid Suspension System

The development of a low-cost and rapid takedown of an infringing domain is a top concern for brand owners. As a result, the URS is the most important proposal in the IRT’s report, which is based on a low cost pre-registration system, where trademarks can be placed on file for potential future disputes, and a system that facilitates filing against multiple registrants and multiple domain names simultaneously. However, the IRT maintains that the URS would preserve a registrant’s right to a hearing and/or appeal and would not replace other current options available, such as the UDRP or other litigation options. While the URS might not replace [24] the other enforcement options, the way that a URS decision could impact the outcomes of those other avenues should be taken under consideration during the further development of the URS.

1. How can a trademark owner regain the domain name for his own use?
2. Would the trademark owner have to file a UDRP in order to do so?
3. How would the outcome of the UDRP be affected by the URS?

The URS should also include provisions that shift the burden of payment for the dispute process to the infringer. A system in which the party that loses the dispute is responsible for the cost of the dispute will create a deterrent against future abuse.

Domain suspension on ServerHold should be indefinite – in perhaps the most significant clarification that is needed to the IRT’s recommendations, if the URS does not provide for transfer, the suspension of the domain should at least last indefinitely, or so long as the successful Complainant continues to periodically reverify the validity of its own trademark rights (such as through the periodic reverification process for the trademark’s data in the IP Clearinghouse). Otherwise the URS will suffer from the same symptom that saddles trademark owners with an expensive portfolio of domain names that were acquired defensively to eliminate consumer confusion, but which have no business use and requires serial enforcement actions over the same domain as it expires and is released. Instead, if the complainant does not have the option of obtaining the transfer of the domain, it should at least be placed on indefinite ServerHold with no expiration.

The Respondent should bear the burden of proving it has legitimate rights in the Domain – By allowing the registrant merely to supply “evidence” that they have some legitimate right in the domain name, and by allowing the registrant to answer at any time during the registration, the IRT invites registrants to delay the deactivation or transfer of the name, by filing deficient or fabricated answers.

Examination factors (trademark examination) – The requirement that the complainant’s registered trademark must have been issued by a jurisdiction that conducts substantive examination of trademark applications should make clear that it only requires examination on absolute grounds (of descriptiveness, functionality, etc.). While the IRT points out that reliance on registrations that undergo no substantive evaluation resulted in gaming the system during, for example, the .eu launch, this concern does not require relative examination, and requiring it would, as an example, render one of the world’s most meaningful trademark registrations, a European Community Trade Mark (with an opposition system but no examination on relative grounds) an improper basis for a URS proceeding.

Impact of these RPMs on trademark law

The RPMs should enforce and protect existing trademark rights, but not create new rights to make an already complicated situation complex.

A trademark is limited to specific classes of goods and services, and the vast majority are not global marks but are also geographically circumscribed; therefore, the use of a trademark as or within, a domain name cannot automatically confer pre-emptive power as to all goods and services or all locales in the context of a global Internet. Setting limits on the scope of trademark rights in the DNS is particularly important where the trademarked word(s) is of the generic dictionary variety and overly expansive rights could stifle ecommerce competition and innovation.

It can be tricky and not clear to have the ‘mark + generic term’ proposal as creation of a new right beyond that conferred by trademark law, as well as degradation of the purpose of the TMC as an authoritative repository of trademarks meeting certain high standards for inclusion. In addition, because many potential combinations of marks plus generic terms would likely be non-infringing, such an expansion would result in an ordinate number of trademark claims service “false positive” warning notices to innocent potential registrants who, lacking sophistication in trademark law, would be unjustifiably deterred from completing the registration process. As a consequence of the GPML and impact of the clearinghouse, the following marks are not eligible [25] for inclusion in the Clearinghouse:

1. Registered trademarks such as:
• Trademark applications;
• Trademarks registered by a city, state, province, or sub-national region;
• International trademark applications made via the Madrid system unless the underlying basic trademark registration has national effect;
• Registered marks that were subject to successful invalidation, cancellation, opposition, or rectification proceedings.
2. Court Validate Marks
3. Marks protected by statute or treaty

Reference

[1] Kristina Rosette, ‘New gTLDs: An Opportunity or A Problem?’, Trademark World magazine (Sept. 2008) pg. 22
[2] Ibid at pg. 23-24
[3] Kristina Rosette, ‘ICANN and trademark protection in new GTLDs’, Trademark World magazine (Dec. 2009), available at http://goo.gl/GIVxS
[4] ICANN GNSO Council resolution, Feb 2011, available at http://gnso.icann.org/en/council/resolutions#201102
[5] Margie Milam, ‘Final GNSO Issue Report on The Current State of the Uniform Domain Name Dispute Resolution Policy’ (1st, ICANN, US 2011), available at http://gnso.icann.org/issues/udrp/udrp-final-issue-report-03oct11-en.pdf (hereafter UDRP-FIS)
[6] K.V. Komaitis, The Current State of Domain Name Regulation: Domain Names as Second Class Citizens in a Mark-Dominated World (1st, Routledge, UK 2010)
[7] K.V. Komaitis, ‘Still insisting on a UDRP Review’ (komaitis.org 2011) available at http://www.komaitis.org/1/category/registrant/1.html
[8] J.P. Morgan & Co., Incorporated and Morgan Guaranty Trust Company of New York v. Resource Marketing, D2000-0035 [2000] (WIPO-AMC), available at http://www.wipo.int/amc/en/domains/decisions/html/2000/d2000-0035.html
[9] Talk City, Inc. v. Michael Robertson, D2000-0009 [2000] (WIPO-AMC) available at
http://www.wipo.int/amc/en/domains/decisions/html/2000/d2000-0009.html
[10] Berkman Center for Internet and Society, ‘ANALYSIS OF KEY UDRP ISSUES’ (cyber.law.harvard.edu 2003) available at http://cyber.law.harvard.edu/udrp/analysis.html#bad
[11] World Wrestling Federation Entertainment, Inc. v. Michael Bosman [1999] (WIPO-AMC) available at http://www.wipo.int/amc/en/domains/decisions/html/1999/d1999-0001.html
[12] WIPO, ‘WIPO Domain Name Dispute Resolution Statistics’ (wipo.int) available at http://www.wipo.int/amc/en/domains/statistics/
[13] See UDRP-FIS pg. 21
[14] IRT, ‘IRT Final Report’, ICANN (2009), pg. 7, available at http://archive.icann.org/en/topics/new-gtlds/irt-finalreport-
trademark-protection-29may09-en.pdf, (hereafter IRT-FR)
[15] TRADEMARK CLEARINGHOUSE (newgtlds.icann.org) available at
http://newgtlds.icann.org/en/about/trademark-clearinghouse
[16] Saassoln, ‘GPML’ (icannwiki.com 2011), available at http://icannwiki.com/index.php/GPML
[17] See IRT-FR pg. 11
[18] ICANN, ‘PROPOSED RIGHTS PROTECTION MECHANISMS - PUBLIC COMMENT SUMMARY (29 October to 26 November 2009)’ (archive.icann.org 2010) available at http://archive.icann.org/en/topics/new-gtlds/summaryanalysis-clearinghouse-urs-15feb10-en.pdf, hereafter ITR-PCS
[19] See IRT-FR pg. 14
[20] See IRT-FR pg. 17
[21] Trademark Clearinghouse, ‘Trademark Clearinghouse Guidelines’ (trademark-clearinghouse.com 2013) available at http://trademark-clearinghouse.com/sites/default/files/files/downloads/TMCH%20guidelines%20v1.1_0.pdf,
[22] See IRT-PCS
[23] See IRT-FR pg. 7
[24] See ITR-FR pg. 25
[25] Registered trademarks (trademark-clearinghouse.com) available at http://trademarkclearinghouse.com/content/registered-trademarks