What next for new TLDs? Part 1 – Unresolved Issues

Like or loathe the decision, ICANN’s new top-level domains program appears to have been delayed again.
But for how long? And what has to happen now before ICANN starts accepting applications?
In short, what the heck happened in Cartagena last week?
In this four-part post, I will attempt an analysis of the various things I think need to happen before the Applicant Guidebook (AGB) is approved.
In this first post I will look at the issues that ICANN has explicitly tagged as unresolved, with special reference to trademarks.
Unresolved Issues
ICANN chairman Peter Dengate Thrush, explaining the board’s resolution on new TLDs on Friday, said:

The intention has been, as much as possible, to indicate those areas where the board feels that the work that has been done is sufficient to move to closure… What we’ve also tried to do is indicate which areas are still clearly open for consideration.

The resolution names only two issues that are explicitly still open for further policy development: geographic strings and “morality and public order” objections. I’ll discuss these in a future post.
Issues considered already reflecting “the negotiated position of the ICANN community” include “trademark protection, mitigating malicious conduct, and root-zone scaling”.
But does this mean that the trademark issue, easily the most contentious of these three “overarching issues” is really sufficiently “closed” that we’ll see no more changes to those parts of the AGB?
I don’t think so. While the Cartagena resolutions say trademark protection has been addressed, it also says “ICANN will take into account public comment including the advice of the GAC.”
It may be too late for the IP community to affect changes directly, beyond the comments they’ve already filed, but the GAC, which has already aligned itself with the trademark lobby, may be able to.
Beyond the text of the resolution, ICANN chair Peter Dengate Thrush said in an interview with ICANN head of media relations Brad White:

We’ve spent a lot of time with the trademark community and come up with three new independent mechanisms for protecting trademark rights on the internet. So the sense of board and the sense of the community is that that’s probably a sufficient effort in developing mechanisms. What we now might look at is how we might enhance, tweak and improve those processes, but we’re not going to convene another process to look at yet another kind of solution for intellectual property rights.

In other words, according to Dengate Thrush, ICANN isn’t planning to create any new IP rights protection mechanisms in the AGB, but these mechanisms, such as Uniform Rapid Suspension and the Trademark Clearinghouse, could be still be modified based on comments received from the trademark lobby over the last week or so.
Most of the outcry from the IP lobby recently has called for the specifics of these two mechanisms to be tilted more in favor of trademark interests; there’s been little call for any new mechanisms.
Trademark rights protections also account for two of the 11 issues that the Governmental Advisory Committee has tagged “outstanding” which “require additional discussion”, by my reading.
More on the GAC bottleneck in part two of this post.

ICANN new TLD launch delayed (again)

ICANN’s new top-level domains program has been delayed, likely for a few months at least, after governments submitted a laundry list of issues they believe are still unresolved.
The Governmental Advisory Committee is mainly bothered that the Applicant Guidebook fails to adequately protect trademark rights and that the cost of the program could outweigh the benefits.
The ICANN board resolved at its meeting here in Cartagena earlier today to meet with the GAC for an unprecedented consultation next February.
(The meeting will also discuss the .xxx application, which I’ve reported on for The Register).
The actual board resolution is hopelessly lengthy and confusing at first reading. Take this doublethink:

ICANN considers that the solutions developed to address the overarching issues of trademark protection, mitigating malicious conduct, and root-zone scaling substantially reflect the negotiated position of the ICANN community, but ICANN will take into account public comment including the advice of the GAC.

Some delegates here tell me they think this means the book has been closed on the portions of the guidebook dealing with IP protection mechanisms, for example.
(J Scott Evans, head of the IP constituency, stormed out of the room in a huff when this part of the resolution was read aloud.)
But the text of the resolution pretty clearly states that IP protections and the other overarching issues are still open for negotiation with the GAC and could be amended based on comments filed this week.
The resolution is open to interpretation with regards these three “overarching issues”.
It does, however, refer to other issues that are explicitly unresolved in ICANN’s view, namely the treatment of geographic names and the handling of “morality and public order” objections.
Both are singled out as needing more work before they can be finalized.
What does all this mean for the launch timetable? I think it means there isn’t one. Again.

[The ICANN board] Directs staff to synthesize the results of these consultations and comments, and to prepare revisions to the guidebook to enable the Board to make a decision on the launch of the new gTLD program as soon as possible.

“As soon as possible” is either meaningless or, taken literally, means the board’s next meeting. That’s likely to be late January, if previous years are any guide.

Trademarks may delay new TLD approval

The intellectual property lobby won a notable victory this week, after governments told ICANN they want it to delay approval of the new top-level domains program until it has more cybersquatting protections.
Some members of the Governmental Advisory Committee appear to have been lobbied hard by the IP community, and have taken its concerns on board more or less wholesale.
The UK representative, Mark Carvell of the Department for Business, Innovation and Skills, was most vocal during a meeting of the GAC and ICANN board here in Cartagena, Colombia yesterday.
He said of the proposed final Applicant Guidebook for new TLDs (which the GAC still pointedly refers to as the “DAG”, for Draft Applicant Guidebook):

Most representations we received came from brand owners, rights holders, they’re the ones being most agitated by this. I think they also recognized the potential opportunities, but the big issue for them was the costs…
The rights protection mechanisms are still not effective enough, that’s what’s coming to us in the Ministry… If you’re really hoping to sign off the guidebook this week, I think that’s something you really ought to reconsider.

Carvell pointed in particular to the proposed Trademark Clearinghouse and Uniform Rapid Suspension policies as needing work – this is essentially the IP lobby’s position also.
His views were supported by Germany, Norway and the Canadian GAC chair, among others.
A repeated refrain was “we’re not there yet”, which prompted ICANN vice-chair Dennis Jennings to push for a definition of “there”. What, in other words, would make the GAC happy enough to go ahead?
The GAC isn’t great when it comes to providing straight answers to those kinds of questions, but Carvell gave it a shot.
He said that currently the GAC does not believe that the benefits of new TLDs outweigh the costs. When it does, that would be the “key turning point”:

When we get to that position, that the benefits for businesses, for the global economy, for opportunities for business, are going to be greater, scaled-up, greater than the costs to brand owners and those who are going to have shell out big-time in order to effectively subsidize, in their view, perhaps subsidize the process.

The US representative, Suzanne Sene, added that “the whole issue is of feeling confident that benefits will outweigh the costs”.
That’s still worryingly free of a measurable benchmark, if you’re an impatient new TLD applicant.
In a further open meeting today, it became clear that the GAC is still putting forth the idea that there could be a “fast-track” or “trial” style TLD application round for “non-controversial” TLDs – presumably meaning TLDs of little interest to defensive trademark holders.
GAC chair Heather Dryden said today that “introducing a conservative first round is the best way to manage risk in the unknown”, an idea that was promptly challenged by TLD applicants including Minds + Machines CEO Antony Van Couvering.
I don’t get the feeling that the GAC has thought the idea through a great deal. In order to be half-way objective, it would presumably require the created of a second, parallel AGB for pre-approving applications. I don’t think the idea has legs.
But do the GAC’s objections mean that new TLD program, currently pencilled in to open the first application round May 30, 2011, will be delayed?
The GAC has not yet submitted its formal Cartagena advice (it should be published tomorrow), but it will presumably reflect the concerns raised over the last few days.
Under ICANN’s bylaws, the organization has to justify any decision to reject GAC advice and then “try, in good faith and in a timely and efficient manner, to find a mutually acceptable solution.”
European Commission representative Bill Dee invoked that part of the bylaws during yesterday’s meeting, and ICANN chair Peter Dengate Thrush agreed that talks were needed.
Dengate Thrush said he was in favor of a GAC-board meeting over one or two days at some point between now and the San Francisco ICANN meeting next March, to thrash out their differences and Dryden seemed to agree.
If that meeting was held fairly soon, it would not necessarily mean ICANN misses the May 30 deadline.
The current proposed timeline contains a 30-day window between Friday and January 11 in which ICANN staff update the “approved” AGB according to the board’s directions.
There follows an obligatory four-month ICANN outreach and marketing campaign.
Conceivably, although scheduling may be a challenge, if the GAC and board meet and resolve their differences over the next 30 days or so, the May 30 deadline could be workable.
I think it might be quite unlikely that’s going to happen, however.
The ICANN board convenes to discuss and vote on the AGB this Friday. It will be very interesting to see how its resolution is worded, and whether it can both save face and serve the GAC.

Beckstrom: ICANN accountable to world, not just US

ICANN chief Rod Beckstrom opened the organization’s 39th public meeting in Cartagena, Colombia, with a speech that touched on many of the organization’s recent controversies and appeared to take a strong stance against US government interference.
Everything from its political tangles with the International Telecommunications Union, to the recent calls for high-security top-level domains for financial services, to Beckstrom’s own controversial pet project, the proposed DNS-CERT, got a mention.
But probably Beckstrom’s strongest statement was the one which indirectly addressed recent moves by the US government to slam the brakes on ICANN’s new top-level domains program:

We are accountable to the world, not to any one country, and everything we do must reflect that.

Beckstrom acknowledged the controversies in the new TLDs policy, given last week’s strongly worded letter from the US Department of Commerce, which was highly critical of the program.
Commerce assistant secretary Lawrence Strickling has called on ICANN to delay the program until it has justified its decision under the Affirmation of Commitments.
But this morning, Beckstrom echoed sentiments expressed on the ICANN blog last week (my emphasis):

As is often the case with policy decisions in that multi-stakeholder model, not everyone is pleased, and this diversity of opinion contributes to the policy process. For example, last week we received a critical letter from the US Department of Commerce. As with all contributions, ICANN will give these comments careful consideration as part of the implementation of the GNSO policy. We welcome the transparent way that Commerce provided their comments through the public comment process.

How ICANN chooses to deal with the demands of its former master, the US government, is one of the Cartagena meeting’s Big Questions.
Another such question is how ICANN plans to deal with ongoing threats to its legitimacy from international bodies such as the International Telecommunications Union.
Addressing ITU secretary general Hamadoun Toure directly, Beckstrom said:

We have always sought to build our relationships based on mutual respect and integrity, taking into account the unique and distinct mandates entrusted to our organizations. The strengthening of communication between us is a personal priority for me.

Security
Security is one of ICANN’s watchwords, and Beckstrom is a security guy by trade. His speeches typically address the topic to a greater or lesser extent and Cartagena was no exception.
Security policies inherently create tensions. Take, for example, controversies about the strength and enforceability of of Whois policies, or Beckstrom’s own call for a DNS-CERT to oversee DNS risk.
This morning, he said:

The staff under my leadership is willing to go as far on security as the community is willing. And whatever security effort this community decides, we will do our utmost to implement and support, given sufficient resources. Because when it comes to security, how can we ever say we’ve done enough?
…
And now you need to tell us: where do you want us to go?
Of course, I am sure we can agree that when it comes to security, the question is not what do we want to do? Or what is popular or easy? It’s what do we owe the world? Because all of us care about the global public interest.

He took, in my view, a subtle swing at the Governmental Advisory Committee for putting security at the heart of its ongoing policy demands, while largely failing to cooperate with ICANN’s requests for information on security issues in their own jurisdictions. Beckstrom said:

We have asked GAC members to provide information about security activities in their countries. We appreciate the information some have shared but there have been few responses. As governments urge us to remain committed to security efforts, we in turn request that they help us by responding and working with the ICANN community on this vital mission.

I know there are some European ccTLD registries a bit miffed that ICANN has in recent months gone over their heads, direct to their governments, for this information, highlighting what a tricky political situation it is.
The speech also touched on internationalized domain names, with a shout-out to the recent launch of Russia’s Cyrillic ccTLD, and general global inclusion activities. I expect the text and audio to be published on the ICANN web site to be published shortly.

Olympics tells ICANN to abandon new TLD launch or get sued

The International Olympic Committee has threatened to sue ICANN unless it gives IOC trademarks special protection in its new top-level domains program.
The IOC’s critique of ICANN’s new Applicant Guidebook is the first to be filed by a major organization in the current public comment period.
The organization has accused ICANN of ignoring it, preferring instead to take its policy cues from the domain name industry, and said it should “abandon its current timeline” for the launch.
ICANN currently plans to start accepting TLD applications May 30, 2011.
Calling the guidebook “inherently flawed”, the IOC’s director general Urs Lacotte wrote:

If these critical issues are not fully resolved and ICANN chooses not to place the Olympic trademarks on the reserved names list, then the IOC and its National Olympic Committees are prepared to employ all available legislative, regulatory, administrative and judicial mechanisms to hold ICANN accountable for damage caused to the Olympic movement.

(That language looks like it could have been cut-n-paste from a separate letter from the financial services industry, which I reported on last week).
The IOC said that it has opposed the new TLD program 11 times – asking for its trademarks to be placed on the AGB’s reserved strings lists, but received no response.
Special pleading? Perhaps, but the IOC’s trademarks are already specifically protected by legislation in numerous countries, including the US, UK, Canada and China.
The IOC also wants stronger trademark protection mechanisms, such as mandatory typosquatting protections in sunrise periods and extending dispute proceedings to registrars.
Expect many more such missives to start showing up on the ICANN web site over the next 11 days before the ICANN board of directors meets to approve the AGB in Cartagena.
This may be the last chance many organizations get to ask for the changes they want in the AGB before the first round of new TLD applications opens, and I expect them to seize it with both hands.

Save the Children recovers domains from scumbag

The international charitable organization Save the Children has recovered two domain names from a squatter who held them hostage for $2,500.
Save the Children, which hosts its official web site at savethechildren.org, recently won a UDRP complaint for the domains save-the-children.com and save-the-children.org, which are both parked.
As you might imagine, it was an open-and-shut case.
Save the Children has been around since the 1930s, and it owns trademarks on its name.
Bad faith was proved with a shockingly clueless email from the registrant:

As you may be aware, with the explosion of the internet and domains, there has been a scramble by speculators or entrepreneurs to purchase popular names or names which we believe may become popular, so we can resell them for a profit. In fact, many businesses will buy numerous domain names that are similar, or may be abbreviations or acronyms, or with different suffexes [sic] in order to get them off the market and prevent somebody else purchasing it.
After consulting with my attorney, and in the best interests of a speedy resolution, I’ve been advised to offer to sell my domain to your client.
I am unwilling to give it up for free since I purchased it. However, I am willing to sell it, and I am asking $2,500.00 for my website.

Whois records show that the domain has changed hands a few times since it was first registered in 2001. I hope the current registrant paid a lot for it.
This kind of behavior is why domainers get a bad rep.

DirectNIC chief tries to dismiss cybersquatting suit

The CEO of DirectNIC is trying to wriggle out of a cybersquatting lawsuit filed by Verizon, seemingly on the grounds that the telco has been unable to track him down.
Sigmund Solares heads up the Grand Cayman-based registrar and lives in Florida, but since suing DirectNIC back in March, Verizon has not been able to find him to serve him notice.
Now, his lawyers are arguing on a technicality that the suit against him should be dismissed (pdf).
Verizon claims that DirectNIC and its directors, via a bunch of shell companies, cybersquatted “nearly every single famous trademark in existence”, including some of Verizon’s.
It filed an amended complaint (pdf) a month ago. Due to its inability to track down Solares, it served the Florida Secretary of State instead, which it’s allowed to do if the defendant evades service.
Verizon has filed a number of declarations from process servers who were unable to serve him, despite staking out his Tampa home on at least 10 occasions over the space of several months.
Solares’ lawyers now want the complaint against him dismissed on the grounds that he’s not been served, and that he was not evading service, he was just away on business and vacation:

no where in the Plaintiffs’ affidavits do the Plaintiffs allege any actions whatsoever on the part of Mr. Solares. The Plaintiffs’ complaint and affidavits merely recount their efforts to serve Mr. Solares. Such allegations cannot clearly show that Mr. Solares is evading process because they allege no actions on his part at all. Plaintiffs’ assertions only show Mr. Solares’ absence from Tampa during the periods when the Plaintiffs attempted to effect service of process.

In response, Solares has filed a fairly detailed account (pdf) of his whereabouts between March and September, which included trips to Milan, Miami, Aruba, Ireland and Boston.
Some of the dates and locations coincide with big domainer conferences.
Verizon’s complaint attacks DirectNIC on essentially two fronts.
It claims that DirectNIC’s practice of parking expiring domains – including those that infringe trademarks – constitutes cybersquatting. This is of course a fairly common industry practice.
It also claims that DirectNIC itself cybersquatted on thousands of domains via a number of shell companies, including NOLDC, Spiral Matrix, Kenyatech, Kentech, Speedy Web, Unused Domains, and Belize Domain WHOIS Service.
There’s a fair bit of circumstantial evidence connecting the firms, and UDRP panelists have previously inferred that they shared ownership, but I don’t think it’s ever been definitively proved.
I reported on this evidence in a bit more depth here.
It’s possible that more evidence could emerge during discovery, but the suit cannot proceed to that stage while the court is still figuring out whether Solares has been served or not.
Dell previously sued DirectNIC on the same grounds. Solares signed an affadavit denying he had anything to do with Kenyatech. That suit was settled.

Lego files a UDRP complaint every three days

Lego, maker of the popular building block toys, is rapidly becoming one of the most UDRP-happy big-brand trademark holders.
The company recently filed its 150th claim, and has so far recovered well over 250 domains that included its trademark.
With over 100 UDRPs filed so far in 2010, that works out to an average of roughly one complaint every three days, and a total spend easily into the hundreds of thousands of dollars.
Its success rate to date is 100%, with no complaints denied.
Its successfully recovered domains include oddities such as legogiraffepenis.com, which appears to be based on this amusing misunderstanding.
If Lego keeps up its current rate of enforcement, it will likely pass Microsoft in the next few months in terms of total cases filed. It’s already filed more than Yahoo and Google.
But it still has a long way to go to catch up with AOL, possibly the most prolific UDRP complainant, which has close to 500 complaints under its belt.

Trademark lobby keeps up pressure on ICANN

The International Trademark Association is continuing to press ICANN into commissioning a study of the potential economic “harms” its new top-level domain program could cause.
INTA executive director Alan Drewsen earlier this month sent ICANN a quick reminder (pdf) that it expects to see the study carried out before the new TLD application round launches.
The trademark lobby believes that new TLDs will increase costs to brand-conscious businesses through an increase in the number of defensive registrations and dispute proceedings they have to pay for.
ICANN hired some third-party analysts to look into the issue, and published a preliminary report in July that basically just speculated about studies that could be carried out in future.
The plan was to carry out a second-phase study, which was to begin after public comments on the first report had been analyzed and summarized by ICANN staff.
Three months after the public comment period closed, this analysis has not been published and there’s no news on phase two.
INTA’s latest missive also notes that the ICANN board does not appear to have discussed the economic study at its Trondheim meeting in September.
Drewson also refers back to previous correspondence, sent in early September by INTA president Heather Steinmeyer, in which she wrote:

trademark owners believe that such a study is not only a sensible recommendation, but an essential prerequisite before any rollout of new gTLDs.

It’s not clear to me whether ICANN also thinks the study needs to be completed before the new TLD program launches.
Such a study would presumably take some considerable time to compile, and noises from ICANN currently point to the program becoming finalized at some point in the next six months.
If the study were to conclude that new TLDs would be hugely financially damaging, after three years of work… well, red faces would be the very least concern.

Trademark holders think new TLD policies inadequate

Less than one in ten trademark holders believes ICANN’s policies go far enough to protect their rights under new top-level domains, according to a recent survey.
World Trademark Review is reporting that 71.6% of its survey respondents believe that the current Draft Applicant Guidebook goes not far enough to “prevent trademark infringement”.
Only 9.5% said they believe the DAG does contain adequate provisions.
The full survey will be published later this month, but today a few more results can be found over at the WTR blog.
The survey was conducted prior to ICANN’s recent Trondheim resolutions, which contained a few amendments to strengthen policies such as Uniform Rapid Suspension.