What $150 Will Get You at ICANN's Trademark Clearinghouse

By Doug Isenberg Three and a half months after promising to announce the providers of its new Trademark Clearinghouse, ICANN has finally informed of us its selections: Deloitte and IBM.

While Deloitte and IBM are certainly well-credentialed, it remains unclear whether the Trademark Clearinghouse will, despite ICANN's assurances, truly provide much protection for trademark owners amid the gTLD expansion.

As described by the Applicant Guidebook, the purpose of the Trademark Clearinghouse is to serve as "a central repository for information to be authenticated, stored, and disseminated, pertaining to the rights of trademark holders." By registering their marks in the Trademark Clearinghouse:

• Trademark owners will obtain certain advantages and notifications during "sunrise" periods that will apply to registrations of second-level domain names within new gTLDs as they are launched; and
• Registrants of second-level domain names will receive (at least during the first 60 days after a new gTLD is open for general registration) notifications of trademarks that are an identical match to their newly registered domain names.

Although many have questioned whether these systems will do anything to combat cybersquatting in the new gTLDs, one lingering and important question appears to have been answered along with ICANN's most recent announcement: How much will trademark owners have to pay to participate in the Trademark Clearinghouse?

A new set of web pages on ICANN's site, posted simultaneously with the announcement of the selection of Deloitte and IBM, provides additional information about the Trademark Clearinghouse and "tracks the progress of implementation work done on the Trademark Clearinghouse." A document on the new page titled "Preliminary Cost Model" (dated June 1, 2012) indicates that the "authentication and validation" services are "expected" to cost trademark owners less than $150 "per submission" (that is, per trademark submitted to the Clearinghouse).

While the $150 fee may seem like a low price to pay for any type of trademark protection online, trademark owners need to keep a number of factors in mind as they decide whether -- or to what extent -- they want to participate, including the following:

• The $150 fee is per trademark.  Therefore, a company with a large portfolio of different trademarks could face a substantially higher fee if it elects to register all of its trademarks at the Clearinghouse.
• To the extent that participation in the Trademark Clearinghouse provides trademark owners with any meaningful protection, that protection will be limited to instances of only identical matches between trademarks and second-level domain names.
• Participation in the Trademark Clearinghouse will not prevent cybersquatters or anyone else from registering any domain name.

In addition, a number of outstanding questions remain about mechanical issues relating to the Trademark Clearinghouse. Hopefully, these will be answered quickly, to give trademark owners time to fully consider their options before deciding whether even a $150 expense is a worthy investment.

Hopeful Domain Name Registry Operators Start to Reveal Their Plans

By Doug Isenberg One day after ICANN finally stopped accepting applications for new global top-level domain names, we're getting real insight into what some of the 2,000-ish new gTLDs might actually look like.

Until now, few applicants (or potential applicants) had announced their intentions, presumably thinking that there would be little strategic benefit in giving anyone else advance notice. But now that the application window has closed, some would-be registry operators are apparently eager to tout their plans.

And the announcements are most interesting.

Among them:

• Google said it has applied for (among others): . google, .docs, .youtube and .lol.  In a blog post, Google's Vint Cerf (a former ICANN chairman) said its applications covered the company's trademarks, "[d]omains related to our core business," "[d]omains that will improve user experience" and "[d]omains we think have interesting and creative potential."
• Momentous said it has applied for .design, .style, .rip and .sucks. The last of these (.sucks) has immediately raised debate among trademark professionals about whether the domain is intended merely to force trademark owners into registering their brands in this potential new gTLD as a defensive measure, given that UDRP and other legal decisions often protect gripe sites.
• Directi said it has applied for a whopping 31 gTLDs in several categories, including those it considers generic (such as .web), industry verticals (such as .law), "business auxiliaries" (such as .app), financial (such as .bank), social and healthcare (such as .doctor) and e-commerce (such as .shop).
• The American Bankers Association and The Financial Services Roundtable said they have applied for .bank and .insurance -- "on behalf of the financial services industry."

Other recent announcements include those for .ngo and .ong (for not-for-profit and non-governmental organizations); another for .web; .home and .casa from registrar GoDaddy; .creditunion; and .secure. These join older announcements for a multitude of gTLDs, just a few of which include .gay; .eco; and .nyc; and such brands as .canon; .hitachi; and .neustar.

Obviously, given the tremendous number of applications that ICANN has received, many more potential gTLDs are still to be revealed. If all goes according to (the latest) plan, that will occur on June 13 -- the day ICANN has designated as "Reveal Day."

As Reveal Day approaches, trademark owners and others concerned about the impact of the new gTLDs should be watching these announcements closely and carefully consider their options for filing objections to the new top-level domain names.

You Can't Take a Domain Name With You When You Die -- So, Make Arrangements Now

By Doug Isenberg Where does a domain name go when its registrant dies?

That's a question that could have been asked in a recent Wall Street Journal article, "If a Business Owner Dies, Who Can Access the Web?" The article focuses on how small businesses continue operating after an owner dies if they depend on cloud-based computing services that were registered in the name of the dearly departed.

If an online banking account, payroll service or e-mail account is controlled by an individual, then a company may have trouble using those services after the individual dies -- especially if the individual has not shared the username and password with others who should have access to them.

The same is especially true for domain names, which need to be renewed and which are essential to most companies' operations -- for a website and/or e-mail addresses.

Think about it. What would you do if your website and e-mail addresses suddenly stopped working because the domain name supporting them was registered to someone at your company who has died? Or, for that matter, someone who simply left your company on less morbid terms.

It might mean the death of your business.

And, it's not just an issue for small businesses.  Companies of all sizes have gotten into trouble for failure to renew their domain names for a variety of reasons. In 2003, Microsoft reportedly failed to renew its <hotmail.co.uk> domain name -- but quickly recovered it from "a good hearted soul."

But many others are not so lucky. Numerous trademark owners have filed UDRP complaints to recover domain names previously in their control. Donna Karan Studio accidentally failed to renew <dknyjeans.com>, Edmunds.com, Inc. let <edmund.com> inadvertently lapse, and even the International Olympic Committee let <olympicmuseum.org> and <olympicmuseum.net> slip through the renewal cracks.

Ensuring that domain names are registered to a corporate (not individual) account and that multiple trustworthy people have access to (and even regularly check on) domain name registrations could help avoid a domain name lapse -- when someone dies or merely forgets to do his job.

And while it's true in the world of domain names, as it is elsewhere, that an ounce of prevention is worth a pound of cure, the UDRP often can help a trademark owner recover its domain in a worst-case scenario.

What's Important About Apple Getting the Domain Name iphone5.com

By Doug Isenberg

A flurry of news reports and blogs state that Apple has gained control of the domain name <iphone5.com>.  See, to name a few, Computerworld, PC Magazine, CNET News, Apple Insider, the San Francisco Chronicle, and even The Christian Post.

The articles note that WIPO's website lists a UDRP complaint for the domain name as "terminated." And the registrant of the domain name is now identified in the Whois database as Apple Inc.

But, why is this news?

Surely, it can't be because the UDRP complaint spills the beans on Apple's plans to call its next smartphone the "iPhone 5." If that's what Apple decides, no one on Earth will be surprised.

Surely, it can't be because the outcome of this UDRP case is unusual. Every day, trademark owners file UDRP complaints, and it's not uncommon for straightforward cases to be terminated if the registrant agrees to transfer the domain name to the complainant (trademark owner). Indeed, in a similarly terminated UDRP case last year, Apple obtained the domain name <iphone4s.com>.

Surely, it can't be because this UDRP case raised novel factual or legal issues (although, without the benefit of seeing the complaint, it's impossible to know for certain). After all, while the "iPhone" trademark was once of dubious value, Apple acquired the mark from Cisco more than five years ago, and the brand is clearly well-known if not legally famous -- therefore, entitled to strong protection against cybersquatting.

The answer (according to the former newspaper reporter inside of me) is simply because it's Apple. And it's about the iPhone. That is, a company with a globally enthusiastic fan base and a product that just might be the most important (and/or exciting) high-tech gadget of our generation attracts news coverage of events (such as terminated UDRP cases) that are otherwise not newsworthy.

Yes, because it's Apple.

That's why I can't recall seeing a single news article about any other recently terminated UDRP decisions, such as (to cite just a few real examples): <swarovskicrystaloutlets.org>, <pricewaterhousesa.com>, <laquintahotel.info>, <citrixindia.com>, <ikeadirecto.com> or <serviceheladeraselectrolux.com>. All great brands, but none with the same cachet as Apple.

So, what's the lesson for trademark owners in the <iphone5.com> UDRP case, if there are no legal precedents to discern? I have two thoughts:

• If your company, or your brand (or even you), are already newsworthy, filing a domain name dispute might catch the attention of one or more reporters, possibly resulting in news coverage of your dispute. (See, for example, <teachbook.com>, <spikelee.com> and <newyorknewyork.com>.)

• Mainstream news coverage of any domain name dispute raises the profile of the cybersquatting problem in general and the UDRP process in particular.

So, Now That ICANN Has Appointed an 'Independent Objector' -- What's an 'Independent Objector'?

By Doug Isenberg ICANN recently announced the appointment of Alain Pellet as the "Independent Objector" for the global top-level domain (gTLD) program. Pellet is a professor at the University Paris Ouest with an impressive background in academics and government service.

So, what will Professor Pellet do in his new role at ICANN, and how will this affect gTLD applicants and others?

The short answer, directly from section 3.2.5 of the gTLD Applicant Guidebook: The Independent Objector "may file objections against 'highly objectionable' gTLD applications to which no objection has been filed" (emphasis added).

Although the gTLD program allows objections to applications on several grounds, the Independent Objector is limited to filing objections based on the following, and only if at least one comment in opposition to the application already has been made:

• Limited Public Interest: "The applied-for gTLD string is contrary to generally accepted legal norms of morality and public order that are recognized under principles of international law."
• Community: "There is substantial opposition to the gTLD application from a significant portion of the community to which the gTLD string may be explicitly or implicitly targeted."

The International Chamber of Commerce will hear both types of objections.

Although the Independent Objector is not the only entity that may file these objections, the creation of this role could increase the number of objections actually filed.

Still, the Independent Objector's mandate is far from clear, given that the Applicant Guidebook does not define what a "highly objectionable" application is, nor does it actually require the Independent Objector to file an objection under any circumstance. As a result, the Independent Objector apparently will have wide discretion, which means we could see few or many objections filed.

ICANN's description of the position doesn't provide much insight into how active the Independent Objector might, stating only that the person fulfilling this role (that is, Professor Pellet) will "act solely in the best interests of the public who use the global Internet when determining whether to file an objection to a given application" and "will be compensated fairly."

Fortunately, ICANN wants the Independent Objector to "publicly report" on his activities and his "time spent." So, based on these public reports and the applications actually filed, we will all learn more in due course about the relevance of this unusual role.

Maybe This is How ICANN Should Handle Its 'Technical Glitch'

By Doug Isenberg Now here's a study in contrasts:

Case Study #1: After years of preparation, ICANN officially began accepting applications for new top-level domain names (TLDs) on January 11, 2012. Although the application window was due to close on April 12, ICANN abruptly shut down the system on that date, citing its discovery of a "technical issue" with the TLD Application System (TAS), which ICANN later said was first reported to it 24 days earlier.

After 18 press releases offering minimal information about the issue, ICANN finally described the problem as "a technical glitch that may have allowed some users to see some file names and user names of other users." ICANN then said that it intends to reopen TAS on May 22 -- 40 days after it first publicly reported the problem, and 64 days after it apparently first learned of the problem.

In the meantime, ICANN announced that it had received 2,091 applications for new top-level domain names, resulting in approximately $350 million in application fees. Trademark owners around the world, among others, anxiously await publication of these domain name applications, which could vastly change how we all use the Internet.

Case Study #2: A popular start-up called Kickstarter -- which bills itself as "a funding platform for creative projects" -- announced on May 13 that, two days earlier, "one of our engineers uncovered a bug involving Kickstarter's private API, which is used to display projects on the Kickstarter homepage."

In its announcement, Kickstarter said: "This bug allowed some data from unlaunched projects to be made accessible via the API. It was immediately fixed upon discovering the error. No account or financial data of any kind was made accessible."

So, in the span of two days, Kickstarter apparently discovered a technical glitch that exposed user data, fixed it, announced details about it, and returned to business as usual.

Perhaps ICANN needs a kickstart?

With Attention Focused on New gTLDs, Another Record Year of Cybersquatting Goes (Almost) Unnoticed

By Doug Isenberg In March, as ICANN was in the midst of receiving applications for new global top-level domains (gTLDs), the World Intellectual Property Organization (WIPO) reported an important-but-nearly-overlooked statistic: The number of domain name disputes reached a record high -- again -- in 2011.

Specifically, as WIPO said:

In 2011, trademark holders filed a record 2,764 cybersquatting cases covering 4,781 domain names with the WIPO Arbitration and Mediation Center (WIPO Center) under procedures based on the Uniform Domain Name Dispute Resolution Policy (UDRP), an increase of 2.5% and 9.4% over the previous highest levels in 2010 and 2009, respectively.

The chart above (total number of domain name dispute cases per year, at WIPO) shows the dramatic trend.

Importantly, these stats don't represent all UDRP cases, given that complaints are also filed at the National Arbitration Forum (NAF), the Czech Arbitration Court (CAC) and the Asian Domain Name Dispute Resolution Centre (ADNDRC). But WIPO's figures are likely representative of overall trends and, in the past, WIPO filings have accounted for about 53% of all UDRP cases.

While the total number of domain name disputes actually filed is only a tiny fraction of all domain names registered, the trend is certainly clear: Cybersquatting is a growing problem.

Despite this important statistic, it appears as if the ailment is largely being ignored. A Reuters article on cybersquatting even buried this record-setting news of 2,764 cases in an article about a mere 10 disputes in the new .xxx top-level domain.

Why has this troubling trademark trend gone unnoticed? A few possibilities:

• Trademark owners, and everyone else in the domaining community, are distracted by so much attention on the new gTLDs -- a future problem, not a current problem.
• Cybersquatting has become merely a way of life, that is, a nuisance that is to be expected and treated in the ordinary course of business.
• As the Reuters article illustrates, writing about .xxx is a lot sexier than writing about a typical UDRP decision that involves confusion with a company outside the adult entertainment industry.
• The same news has been reported before. As the chart above shows, UDRP filings have increased for seven of the past eight years.

Whatever the reason for less attention on the cybersquatting problem -- and the reality is probably all of the above -- the trend appears to be continuing. In the first four months of 2012, UDRP filings at WIPO are already up nearly 15 percent from last year.

Why Brand Owners Will Continue to Rely on the UDRP -- Even After the New gTLDs

Amidst all the talk about potential trademark disputes related to the new global top-level domains (gTLDs), one important topic is often overlooked: whether the UDRP – the Uniform Domain Name Dispute Resolution Policy adopted by ICANN in 1999 – will even apply to the new gTLDs. The answer, fortunately, is yes. Here’s why. And why it’s important.

ICANN’s Applicant Guidebook contains a form registry agreement that successful gTLD applicants must enter into with ICANN prior to delegation of any new gTLD. Section 2.2 of that agreement states: “Registry Operator shall comply with and implement all Consensus Policies and Temporary Policies….” The UDRP is one of those consensus policies.

Therefore, any new gTLD registry operator must implement the UDRP, which means that all registrars for new gTLDs will be required to include the UDRP in their registration agreements, which means that all registrants of new gTLDs must agree to abide by the UDRP process if a complaint is filed against them.

Thus, while much debate has focused on the proposed Uniform Rapid Suspension System (“URS”) – including its numerous shortcomings as an alternative to the UDRP – the important news for trademark owners is that the UDRP will always be available to help resolve troublesome cybersquatting issues and some other domain name abuses.

Presumably, the applicability of the UDRP to the new gTLDs should be welcome by all, especially at a time of such great uncertainty in the domain name system. As a preliminary GNSO issue report on the UDRP (May 27, 2011) concluded: “The UDRP has won international respect as an expedient alternative to judicial options for resolving trademark disputes arising across multiple national jurisdictions.”  Following an ICANN webinar on May 10, 2011, which attracted participants and observers representing both trademark owners and domainers, among others, the GNSO report said that such international respect for the UDRP “was broadly shared during the UDRP Webinar by representatives of a broad cross-section of the Internet community.”

Indeed, as the World Intellectual Property Organization (“WIPO”) has observed, the UDRP is “the only proven mechanism in place to absorb the impact of gTLD expansion.”  This sentiment has been echoed by ICANN’s Intellectual Property Constituency (“IPC”), which cautioned against any alterations to the UDRP “at a time when stakeholders face major changes and uncertainty arising from the launch of the new gTLDs.”

Therefore, while much remains unknown about trademark protections even at the opening of the application period for the new gTLDs, the stable presence of the UDRP should provide at least some degree of comfort to brand owners.

Still, how important the UDRP will be in an expanded  world of top-level domains cannot yet be fully known. For example, despite the limited expansion of the number of top-level domains in the past, the UDRP is overwhelmingly used to resolve disputes relating to .com. WIPO’s statistics show that, in 2011, of the 4,222 domain names disputed in UDRP proceedings at WIPO, more than 77% were .com.  And more than 93% involved the original “big three” gTLDs—.com, .net and .org.  Indeed, five gTLDs (.aero, .cat, .coop, .edu and .museum) are entirely absent from WIPO’s UDRP proceedings this year. (While WIPO is not the only UDRP service provider, it is the largest, handling about 53% of all UDRP disputes, and its statistics – the only UDRP statistics published in detail – are likely applicable to the other UDRP service providers as well.)

Of course, the number of UDRP filings for any gTLD may be influenced by the total number of domains registered within the gTLDs themselves – and .com remains far and away the most popular gTLD. No one knows whether that will continue to be the case – although, with a head start of more than 26 years, .com is likely to remain king for quite some time.

Similarly, the UDRP is likely to remain king of the domain name dispute world for the foreseeable future. With a history of more than 36,000 cases and 28,000 published decisions since its implementation 12 years ago, the UDRP has turned into a popular and usually (though not always) predictable legal tool for resolving domain name disputes.

While so much else remains uncertain for brand owners as the domain name space starts to grow, the UDRP will remain a bedrock of the dispute process on which all parties can rely.

This article was originally published in the February 2012 issue of MarkMonitor's On The Mark newsletter.