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Dead Ends: The Achievement of Consensus in UDRP Jurisprudence

Like the Internet Corporation for Assigned Names and Numbers (ICANN), the Uniform Domain Name Dispute Resolution Policy (UDRP) is consensus-driven; from the bottom up, not the top down. The result is a jurisprudence of domain names that develops in common-law fashion through Panel decisions that over time and through “deliberative conversations” among panelists resolve into consensus. We get some insight into how this consensus comes in a recent case, Dover Downs Gaming & Entertainment, Inc. v. Domains By Proxy, LLC / Harold Carter Jr, Purlin Pal LLC, D2019-0633 (WIPO May 22, 2019) (<doverdownsnews.com>), which I’ll talk about further below.

Readers who keep abreast of UDRP decisions know there are daily lists. Panelists are constantly honing their constructions of the minimalist provisions of the UDRP, both applying and testing its core principles, clarifying concepts, offering new formulations in their attempt to get it right, and sometimes proposing new or modifying principles that have been agreed upon or rejected by consensus. There is one other player in this process that influences panelists by reinforcing the consensus once it has plainly been achieved, and that is the World Intellectual Property Association (WIPO) as publisher of Overviews of WIPO Panel Views on Selected UDRP Questions: Original edition (2005), 2nd Edition, 2.0 (2011), and 3rd Edition (2017) (“Jurisprudential Overview”). The Overviews (which come about through a sifting process of decisions and consultations with panelists) record the evolution of the jurisprudence over time (wherein some principles hold up, some modified or dropped, and others refined).

The “dead ends,” which are the subject of this essay are principles and proposed standards that appear insightful when formulated but are seen by their fellow panelists as misguided. A jurisprudence that develops without the benefit of appellate review (as is the case with the UDRP) is bound to produce constructions that are distributed on either side of what panelists as a whole regard as the correct rails. It is clear in reading Dover Downs Gaming & Entertainment, Inc. v. Domains By Proxy, LLC / Harold Carter Jr, Purlin Pal LLC, D2019-0633 (WIPO May 22, 2019) (<doverdownsnews.com>) that panelists make known their thinking about revolutionary proposal both informally (behind the scenes) and in their published decisions, although the consensus may take years to unfold. The great value of Dover Downs is that it opens up an insider’s view of the internal mechanism or process that over time creates consensus. The dead-end principle highlighted in that decision involved the free speech defense. It was formulated in 2007 and finally declared dead in 2017 with the publication of a “new consensus” reported in WIPO Overview 3.0.

There is no ignominy in formulating or proposing modifications to establish principles or propose new standards even though on reflection by a panelist’s peers they prove not right for the jurisprudence; that’s how law progresses: some ideas thrive, and others fail. It is particularly impressive when one of the outstanding UDRP panelists addresses a formulation of his own that met the dead-end fate and the manner in which he dispassionately dissects the underlying reason for his proposing then abandoning it. I will return to Dover Downs after a quick review of some minor and one other major dead end.

The consensus view is that the “sole lodestar for a Panel must be the Policy… WIPO decisions have steadfastly maintained that the laws of any particular country do not apply to the dispute,” Edmunds.com, Inc. v. Ult. Search Inc., D2001-1319 (WIPO February 1, 2002); and in another case the Panel stated that UDRP “operates within its own unique context,” Diet Center Worldwide, Inc. v. Jason Akatiff, D2012-1609 (WIPO October 5, 2012). That “unique context,” which has several layers of meaning, is driven by the panelists themselves who corporately create consensus, which is then further reinforced through the WIPO Overviews.

Minor examples of dead ends include: 1) granting Complainant’s request for transfer of a dictionary word trademark (“Crew”) on the theory that Respondent was “a speculator who registers domain names in the hopes that others will seek to buy or license the domain names from it”; 2) suggesting that the proper standard for deciding bad faith should be clear and convincing rather than a preponderance of the evidence; 3) arguing that a complaint is premature if the domain name is passively held; and 4) that using a service “gives rise to a rebuttable presumption of bad faith registration and use.” In all four of these, the proposed principles or standards were either ignored or received negative reviews from other panelists and died on the vine.

The first major idea to fail was offered by the Panel who decided the first UDRP case (2000), although in that case, World Wrestling Federation Entertainment, Inc. v. Michael Bosman, D1999-0001 (WIPO January 31, 2000) his constructions were among those that have become the core principles of the UDRP. He offered his new construction on the same issue of conjunctive bad faith in dissent in 2009 and then successfully applied it as sole Panel in Octogen Pharmacal Company, Inc. v. Domains By Proxy, Inc. / Rich Sanders and Octogen e-Solutions, D2009-0786 (WIPO August 19, 2009):

[After] a careful reading of the language of the Policy, the Panel is convinced that both the Telstra [Corporation Limited v. Nuclear Marshmallows, D2000-0003 (WIPO February 18, 2000)] approach [passive use of domain names] and the language of the Policy itself [Paragraph 2, Representations] provide a basis for panels to broaden their position on this issue [of bad faith registration]

This insight led him ineluctably to conclude that under some circumstances involving use of the domain name “registration of the domain name could be said to be retroactively in bad faith” (Emphasis added). In other words, even if the domain name was registered in good faith, bad faith could still be found if justified by the bad faith.

The Octogen construction was “not universally accepted,” and ultimately it was abandoned as a dead end. In a 2013 decision, the Panel acknowledged as much, Guru Denim Inc. v. Ibrahim Ali Ibrahim abu-Harb, D2013-1324 (WIPO September 27, 2013). There is a passing notice of the construction’s demise in WIPO Overview 3.0, NB following paragraph 3.2.1, although while it was being actively argued through many decisions it did lead another Panel to formulate a theory of cybersquatting based on renewal of registration with knowledge of a complainant’s right that also came to a dead-end, Eastman Sporto Group LLC v. Jim and Kenny, D2009-1688 (WIPO March 1, 2010).

The proposed principle at the center of Dover Downs was first presented in an exceedingly diplomatic dissent in Richard Starkey v. Mr. Bradley, FA0612000874575 (Forum February 12, 2007) (<ringostarr.mobi>. The Panel (the same as in Dover Downs) reasoned that the complaint should have been denied even though the parties were UK based because the choice of mutual jurisdiction was U.S., and for efficiency UDRP decisions should conform to.

the likely outcome if domain name disputes were to proceed to litigation [in the U.S], [which would help] panels . . . ensure consistent application of the law and can help discourage unnecessary litigation, thus advancing the goals of expedience and efficiency that underlie the Policy.”

The Panel followed Starkey with two more decisions (this time as sole Panel) in Xtraplus Corporation v. Flawless Computers, D2007-0070 (WIPO March 9, 3007) (<zipzoomflysucks.com> and in Sermo, Inc. v. CatalystMD, LLC, D2008-0647 (WIPO July 2, 2008). He justified his analysis on the grounds of efficiency:

The benefits of this approach are many. Although consistency may remain an elusive goal, this approach would help promote predictability in the UDRP system in that parties would know in advance which national laws (and, with respect to the specific question here, which “view” of the Decision Overview) would most likely apply…. t would help support the UDRP itself by helping to ensure that the UDRP is seen as a fair, consistent, and predictable legal system, instead of an unfair, inefficient system that results in random decisions (based on the identity of the panelist) or erroneous decisions that are disregarded and voided by courts in those cases in which paragraph 4(k) has been invoked.

Other panelists did not see any “benefits of this approach.” For them, the proposal strayed from the “sole lodestar” concept resulting in unacceptable inconsistency that had the potential of “fragment[ing] [the UDRP] into a series of different systems.’” In particular, they found the Sermo formulation unnecessary and were “skeptical that either the analysis or the solution offered in Sermo to the local law problem is wholly convincing.”

By 2005, the date of publication of Overview 1.0, there had already developed a split over the free speech defense: was it to be applied to the domain name or to the content of the resolving website? The split (essentially two ways of addressing the issue) is reported in Overviews 1.0 and 2.0 under the heading “Can a criticism site generate rights or legitimate interests in the disputed domain name?” WIPO 1.0 and 2.0 split the answer to this question into two views:

View 1 (1.0): The right to criticize does not extend to registering a domain name that is identical or confusingly similar to the owner’s registered trademark or conveys an association with the mark. (Overview 2.0 adds clarifying language—“does not necessarily extend” for example (emphasis added)—which has found its way into Overview 3.0, discussed further below.)

View 2: Irrespective of whether the domain name as such connotes criticism, the respondent has a legitimate interest in using the trademark as part of the domain name of a criticism site if the use is fair and non-commercial.

View 1 panelists—the “Domain Name itself is misleading” approach—believe that application of the defense is contingent on the composition of the domain name. View 2—a “complaints site” approach—panelists focus on the content of the website without regard to the composition of the domain name. These formulations have now been replaced by a newly stated consensus, neither one nor the other but more of View 1 than View 2. WIP0 Overview 3.0, Paragraph 2.6 states “UDRP jurisprudence recognizes that the use of a domain name for fair use such as non-commercial free speech, would in principle support a respondent’s claim to a legitimate interest under the Policy [it is not automatic].” But, there is a “but.” The consensus continues:

2.6.1 To support fair use under UDRP paragraph 4(c)(iii), the respondent’s criticism must be genuine and non-commercial; in a number of UDRP decisions where a respondent argues that its domain name is being used for free speech purposes the panel has found this to be primarily a pretext for cybersquatting, commercial activity, or tarnishment.

This returns us to the more recent dead-end construction which is at the center of the decision in Dover Downs. Had the Sermo formulation been adopted as a consensus view it would have had the effect of subordinating UDRP jurisprudence to local law, precisely what other panelists were unwilling to accept. They saw it as hostile to prior established consensus, which of course it was. While the Panel continued defending the “benefits of this approach” in Dover Downs he nevertheless bows to fellow panelists in accepting their verdict:

this Panel strongly believes that it is ... important for the UDRP to articulate a consistent view rather than to allow the schism between these views to fester.

The reason for this is that a

consistent approach provides a more reliable system of law where the parties can anticipate a result under the UDRP that will not depend on the panel assigned.

In taking this position, the Dover Downs Panel has come around to recognizing that certain constructions (his included) are damaging to the UDRP if allowed (in his words) “to fester.” For that reason, “this Panel supports the position expressed in the WIPO Overview 3.0, which reflects the consensus that has coalesced around a compromise position.” The compromise position is set out in Paragraph 2.6 and subparts. In essence, the test is whether the use creates an “impermissible risk of user confusion through impersonation” (2.6.2).

While the Starkey/Sermo approach appeared logical, it concealed a bias ultimately unacceptable to “many stakeholders, notably including the majority of panels to consider this issue.” I find this last statement of particular interest because it reveals the source of pressures that drive consensus. (No different, I might add, from the pressures in ICANN working groups). In reflecting on these oppositions and the downside of the local law/conflict of laws approach, the Starkey/Xtraplus/ Sermo Panel concludes “it is equally important for the UDRP to articulate a consistent view rather than to allow the schism between these views to fester… [and therefore] supports the position expressed in the WIPO Overview 3.0, which reflects the consensus that has coalesced around a compromise position.”

Panels have noticeably begun employing the “impersonation” analysis to find abusive registration, although a possible casualty of this “compromise position” is that respondents have lost a valuable evidentiary advantage of having the benefit of the doubt; now if there is any doubt it will favor complainants, particularly against defaulting respondents (this may be true, incidentally, not only of free speech disputes). Nevertheless, the “compromise position” is also a full circle back to UDRP as the Panels’ “sole lodestar” in determining the issue of rights.

By Gerald M. Levine, Intellectual Property, Arbitrator/Mediator at Levine Samuel LLP

Information about the firm can be found on the Firm’s website at iplegalcorner.com. Mr. Levine has a litigation and counseling practice representing clients in Intellectual Property rights and management, Internet and Cyberspace issues, domain names and cybersquatting, as well as a diverse range of legal and business matters from working with client to resolve commercial disputes, to copyright and trademark counseling and registrations. He is the author of a treatise on Trademarks, Domain Names, and Cybersquatting, Domain Name Arbitration: A Practical Guide to Asserting and Defending Claims of Cybersquatting Under the Uniform Domain Name Dispute Resolution Policy. A Second Edition of the treatise was published July 2019 and is available from Amazon or from the publisher, Legal Corner Press (LCP). For inquiries to LCP write to .(JavaScript must be enabled to view this email address) or Mr. Levine at .(JavaScript must be enabled to view this email address).

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