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Claims UDRP has cost over $360 million so far

Kevin Murphy, February 13, 2019, Domain Policy

Trademark owners have splashed out over $360 million on UDRP cases over the 20 years the policy has been active, according to an intellectual property trade group.

Marques, a European body representing trademark owners, reckons $360 million is a “conservative” estimate.

It reached the figure by multiplying the number of UDRP complaints filed to the end of 2018 — 72,038 — by the $5,000 estimated total cost of each complaint.

The World Intellectual Property Organization, which handles well over half of all UDRP cases, charges at least $1,500 per case, but trademark owners have other fees, such as paying lawyers to draft the complaints.

WIPO, which basically designed and wrote the UDRP back in 1998, has been paid at least $63.8 million in filing fees to date, Marques calculates.

Across all UDRP providers, well over 100,000 individual domain names have been subject to UDRP. It’s likely much more, but the National Arbitration Forum does not publish data on unique domains.

The Marques claims were made in a letter (pdf) from council member (and Com Laude managing director) Nick Wood to ICANN last week, part of IP lobbying efforts in the face of UDRP reform efforts. He wrote:

This lowest-case estimate of $360m is a very significant financial burden. Registrants, on the other hand, pay only for their own defence, if any. They do not pay damages, or even contribute to the provider fees, if they lose – which across the five active panel providers appears to be majority of the time.

One proposal that has been put forward by IP owners is for registrants to pay a $500 fee when they are hit by a UDRP complaint, which would be refundable if they prevail.

I can see this idea going down like a cup of iced sick in the domainer community.

Rather than lobbying for any specific proposal, however, Marques is asking ICANN to create an “independent expert group” outside of the usual Policy Development Process, to highlight “priority issues and possible solutions” for the PDP to consider.

Marques thinks the group should comprise a small number of trademark interests, registries and registrars, and registrant rights groups. It wants WIPO to chair it.

It also wants ICANN to coordinate UDRP providers in the creation of a unified set of data on UDRP cases processed to date, to help with future reform discussions.

ICANN community volunteers have been working on the “PDP Review of All Rights Protection Mechanisms in All gTLDs” — the RPM WG — since March 2016.

The RPM WG expects to put out its “Phase One” initial report, comprising recommendations for reform of the Trademark Clearinghouse, Trademark Claims and Sunrise policies, in early June this year.

Only then will it turns its attention to UDRP, in “Phase Two”, with talks due to begin at the ICANN 65 meeting in Marrakech later that month.

The working group has been beset by all kinds of personal drama among volunteers recently, which continues to add friction to discussions.

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Ironic eight-figure deal marks more Euro-registrar consolidation

Kevin Murphy, February 11, 2019, Domain Registrars

Slovakian registrar WebSupport, which is run by a local politician, has been acquired in a reported eight-figure deal.

The acquirer is Loopia, a Swedish registrar backed by Danish private equity firm Axcel.

The deal seems to have closed around the same time as Loopia’s acquisition of .SE Direkt from Swedish registry IIS, though news only broke today.

WebSupport reportedly hosts around 173,000 domains, though it’s not clear whether it acts as registrar for all. It’s not ICANN-accredited, but it does resell domains in a wide range of gTLDs.

It reportedly has annual revenue approaching €4 million and sold for “a two-digit figure in millions of euros”.

According to Vladimir Vano, Slovakian comms chief at CentralNic, which acquired .sk registry SK-NIC last year, WebSupport is the largest .sk registrar.

There’s a certain irony with WebSupport being sold into foreign hands.

The co-founder and majority owner of the company is Michel Truban, an entrepreneur-turned-politician who was closely associated with a campaign to have UK-based CentralNic’s acquisition of .sk blocked.

It was alleged (and denied) at the time that the campaign was party-political, though its main concern appeared to be that CentralNic would bastardize .sk into some kind of horrible domain hack.

Today, Truban wrote on his blog “I’m selling WebSupport and I’m going into politics”. In 2017, he co-founded the liberal Progressive Slovakia party.

He said the money from the deal would free him from inappropriate influence by “oligarchs and patrons”.

Google Translate says Truban wrote: “I had an offer that was about a million euros higher, but I declined it. Because it was from people with bad history and at the same time I wanted WS to get an international story.”

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Court rules generic dictionary domains CAN be trademarked

Kevin Murphy, February 11, 2019, Domain Policy

A US appeals court has ruled that generic, dictionary domain names can be trademarked.

The hotel-booking web site Booking.com was told last week that it is in fact eligible to have “Booking.com” registered as a trademark, over the objections of the US Patent and Trademark Office.

The ruling could have a chilling effect on domain name choices in the hotel-booking market.

USPTO had denied the company’s trademark application in 2012 because “Booking.com” was considered too generic.

Under US trademark law, you can’t register a trademark if it merely generically describes the product or service you offer rather than its source.

You couldn’t register “Beer” as a brand of beer, for example, though you might be able to register “Beer” as a brand of shoes.

Booking.com sued to have the USPTO ruling overturned in 2016, and in 2017 a district court judge ruled that “although ‘booking’ was a generic term for the services identified, BOOKING.COM as a whole was nevertheless a descriptive mark”.

USPTO appealed, saying that “Booking.com” is too generic to be trademarked, but last week it lost.

In a 2-1 majority decision, the appeals court ruled:

We hold that the district court, in weighing the evidence before it, did not err in finding that the USPTO failed to satisfy its burden of proving that the relevant public understood BOOKING.COM, taken as a whole, to refer to general online hotel reservation services rather than Booking.com the company… we reject the USPTO’s contention that adding the
top-level domain (a “TLD”) .com to a generic second-level domain (an “SLD”) like booking can never yield a non-generic mark.

Key evidence was a survey Booking.com had submitted that indicated that almost three quarters of consumers understood “Booking.com” to be a brand name, rather than a generic term to describe hotel-booking web sites.

Here are some other extracts of the appeals court majority’s thinking, as they relate to domain names:

Merely appending .com to an SLD does not render the resulting domain name non-generic because the inquiry is whether the public primarily understands the term as a whole to refer to the source or the proffered service.

We… conclude that when “.com” is combined with an SLD, even a generic SLD, the resulting composite may be non-generic where evidence demonstrates that the mark’s primary significance to the public as a whole is the source, not the product

because trademarks only protect the relevant service — here, the district court granted protection as to hotel reservation services but not travel agency services — protection over BOOKING.COM would not necessarily preclude another company from using, for example, carbooking.com or flightbooking.com

In sum, adding “.com” to an SLD can result in a non-generic, descriptive mark upon a showing of primary significance to the relevant public. This is one such case.

The ruling does not appear to protect all uses of a generic dictionary word combined with a TLD, but rather only “rare circumstances” where there’s evidence of a secondary, non-generic meaning.

One judge on the case, James Wynn, was not convinced by the majority’s thinking. He warned that the ruling goes against years of legal precedent and could enable Booking.com to subject competitors to expensive litigation.

In his dissenting opinion, he wrote:

BOOKING.COM is a run-of-the-mill combination of a generic term with a Top Level Domain that creates a composite mark concerning the subject or business encompassed by the generic term—precisely the type of mark that the courts in Hotels.com, Reed Elsevier Properties, 1800Mattress.com, and Advertise.com found did not amount to the “rare circumstance” that warranted affording the domain name trademark protection.

Presumptively allowing protection of domain names composed of a generic Secondary Level Domain and Top Level Domain conflicts with the law’s longstanding refusal to permit registration of generic terms as trademark

Wynn added that he was “not convinced” that Booking.com’s competitors that use the word “booking” in their domains will be protected by the “fair use” defense, and that the existence of such a defense will not prevent Booking.com from suing them out of business regardless.

Put simply, putative competitors may — and likely will — choose not to operate under domain names that include the word “booking” — even if that term best describes the service they offer — because they do not want to incur the expense and risk of defending an infringement action.

The full ruling can be read here (pdf).

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ICANN director Burr leaving Neustar

Kevin Murphy, February 11, 2019, Domain Registries

Neustar is losing its chief privacy officer, Becky Burr, who also sits on ICANN’s board of directors.

Burr, a lawyer, said last week that she’s decided to return to private practice after almost seven years at the registry.

Her last day will be March 1, but she’ll continue to advise the company as outside counsel on issues such as privacy and .us policy.

Lips are sealed on her exact destination, but it’s apparently small, Washington, DC-based, and focused on data protection.

Prior to Neustar, Burr worked for the law firm Wilmer Hale. Prior to that, she was in the US National Telecommunications and Information Administration, where she helped create ICANN 20 years ago.

Despite no longer being directly employed by a registry or registrar, Burr said she’s hoping to be reelected to the ICANN board, where she represents the Contracted Parties House, when her current term expires at the end of the year.

In addition to .us, Neustar runs .co, .biz and acts as back-end for dozens of other TLDs.

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Right of the colon? IDN getting killed over dot confusion

Kevin Murphy, February 11, 2019, Domain Registries

An internationalized domain name ccTLD is reportedly getting buried because of a confusion about how many dots should appear.

Armenia’s .հայ (.xn--y9a3aq) today has fewer than 300 registered domains, well under 1% of the volume enjoyed by the Latin-script .am, apparently due to a unique quirk of the Armenian language.

According to a report in the local tech press, sourcing a registry VP, .հայ domains are not working because of how the Armenian script uses punctuation.

In Armenian, a full-stop or period is represented by two vertically aligned dots called a verjaket that looks pretty much identical to a colon in English and other Latin-based languages.

A single dot, looking and positioned exactly like a Latin period, is called a mijaket and is used in the same way English and other languages use a colon.

It’s not entirely clear whether the problem lies with the user, the keyboards, the browsers, or elsewhere, but it’s plain to see how confusion could arise when you have Armenian-script characters on both sides of a Latin-script dot.

The registry, ISOC Armenia, is today reporting just 298 .հայ domains, compared to 34,354 .am domains.

The Latin-script ccTLD has benefited in the past from its association elsewhere with AM radio. It’s also sometimes used as a domain hack, including by Instagram’s URL shortener.

It’s probably worth noting that while Armenia seems to have a unique problem, it’s far from unusual for an IDN ccTLD to perform poorly against its Latin stablemate.

.հայ, which transliterates to “.hay”, is an abbreviation of the Armenian name for Armenia, Հայաստան or “Hayastan”. It was delegated by ICANN in 2015 as part of its IDN ccTLD fast-track program.

Armenian has fewer than seven million speakers worldwide. Armenia has roughly three million inhabitants.

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