ICANN may have got lucky with a URS vendor

ICANN may have found a vendor willing to provide Uniform Rapid Suspension services for new gTLDs at $500 or less per case, without having to rewrite the policy to do so.
Last month, Olof Nordling, director of services relations at ICANN, gave the GNSO Council a heads-up that the URS policy may have to be tweaked if ICANN were to hit its fee targets.
But last week, following the receipt of several responses to a URS vendor Request For Information, Nordling seems to have retracted the request.
In a message to Council chair Jonathan Robinson, he wrote:

The deadline for responses to the URS RFI has passed and I’m happy to inform you that we have received several responses which we are now evaluating. Moreover, my first impression is that the situation looks quite promising, both in terms of adherence to the URS text and regarding the target fee. This also means that there is less of an urgency than I previously thought to convene a drafting team (and I’m glad to have been proven wrong in that regard!). There may still be details where such a drafting team can provide useful guidance and I will get back to you with further updates on this and other URS matters as we advance with the evaluations.

The target fee for URS has always been $300 to $500 per case, between a fifth and a third of the fee UDRP providers charge.
Following an initial, private consultation with UDRP providers WIPO and the the National Arbitration Forum, ICANN concluded that that it would miss that target unless the URS was simplified.
But some GNSO members called for a formal, open RFP, in order to figure out just how good a price vendors were willing to offer when they were faced with actual competition.
It seems to have worked.
During a session on URS at the Toronto meeting last month, incumbents WIPO and NAF were joined by a new would-be arbitration forum going by the name of Intersponsive.
Represented by IP lawyers Paul McGrady and Brad Bertoglio, the new company claimed it would be able to hit the price target due to software and process efficiencies.
NAF also said it would be able to hit targets for most URS cases, but pointed out that the poorly-described policy would create complex edge cases that would be more expensive to handle.
WIPO, for its part, said a cheaper URS would only be possible if registrants automatically lost the cases if they failed to respond to complaints.
This angered big domainers represented by the Internet Commerce Association and free speech advocates in the GNSO, who feared a simpler URS meant fewer registrant rights.
It’s not yet known which vendors are in with a shot of winning the URS contract, but if ICANN has found a reasonably priced provider, that would be pretty good news for registrants and IP owners.

ICANN publishes RFI for URS provider

ICANN has issued an open call for dispute resolution providers interested in running its Uniform Rapid Suspension system.
In a request for information published last night, ICANN says it expects to pick a provider or providers by February 28, 2013.
If you’re not already running a dispute resolution service at scale there seems to be little point in applying. The RFI states that respondents must, at a minimum:

Have a track record in competently handling clerical aspects of Alternative Dispute Resolution or UDRP proceedings
…
Have a team of globally diverse and highly qualified neutrals, with experience handling UDRP or similar complaints, to serve as panelists.

With that in mind, will the RFI help sort out the problems with the URS?
What ICANN needs right now is a provider happy to administer proceedings for $300 to $500 per case.
ICANN has already asked WIPO and the National Arbitration Forum for their pricing expectations and neither apparently thinks they can do it much cheaper than UDRP. Hence the RFI.
Could the Czech Arbitration Court be in with a shot?
CAC already has UDRP experience and a stable of trademark experts on hand, and some say its level of automation is superior to — and presumably more cost-efficient than — both WIPO and NAF.

WIPO supported Draconian cybersquatting reform

Domain name owners who do not respond to cybersquatting complaints could automatically have their domains suspended, if the World Intellectual Property Organization gets its way.
That’s according to the latest ICANN documents to be released under its Documentary Information Disclosure Policy, following a request from the Internet Commerce Association.
The documents relate to the still controversial Uniform Rapid Suspension policy, a supplement to the existing UDRP for dealing with “clear cut” cases of cybersquatting.
The URS will be binding on all new gTLDs, but ICANN recently admitted that it’s been unable to find an organization willing to administer URS cases for the planned $300 to $500 filing fee.
Rather than implement URS with a $1,000 to $1,500 fee instead, ICANN plans to host two community summits to try to figure out ways to rearchitect the scheme to make it cheaper.
These changes could well mean fewer safeguards for domain registrants.
According to an email from WIPO released in response to ICA’s DIDP request, WIPO declined to host these summits unless ICANN agreed, in advance, to Draconian rules on default.
WIPO’s Erik Wilbers wrote (pdf):

it would seem unlikely that these stakeholders would now feel able to commit to the rather fundamental changes we believe to be in everyone’s interest – notably a shift to the proposed respondent-default basis without panel, subject to appropriate safeguards. We would consider an express prior commitment to such a shift, including the requisite Board support, as a pre-condition to a fruitful meeting on the URS.

In other words, WIPO thinks domain names should be suspended without expert review if the domain owner does not respond to a trademark owner’s URS complaint.
ICA counsel Phil Corwin is naturally not happy about this, writing in a blog post this weekend:

WIPO would only consent to hosting URS Summits if their result was largely pre-ordained – in which event, we ask, why bother holding the Summits at all? … This imperious demand should be dismissed out of hand by members of ICANN’s Board should it ever reach them.

That the structure of URS is still open for debate at this late stage of the game is an embarrassment, particularly given the fact that it’s been well-understood for some time that URS was unrealistically priced.
The new DIDP documents reveal that even the idea of summits to resolve the apparently intractable problems were a Band-Aid proposed almost accidentally by ICANN staff.
ICANN, it seems, is engaged in policy fire-fighting as usual.
The current hope is for URS to be finalized and a provider be in place by June 2013. It’s a plausible timetable, but I’m less convinced that a system can be created that is fair, useful and cheap.

NAF loses UDRP market share again

If UDRP forum shopping is a real phenomenon, the market share statistics don’t bear it out.
The National Arbitration Forum today announced a sequential decrease in the number of cybersquatting cases it handled in 2011, widening the gap between itself and the World Intellectual Property Organization for at least the second year in a row.
NAF said it handled 2,082 complaints last year, down 4% from 2010. That’s over the same period WIPO saw a 2.5% increase to 2,764 cases.
NAF is occasionally accused of being the more complainant-friendly of the two major UDRP dispute resolution providers, which some say encourages “forum shopping”.
While that may or may not be true in certain fringe cases, it’s certainly not helping NAF win a flood of business. WIPO is still handling more cases, and growing its share while NAF’s shrinks.
As Mike Berkens observed over on The Domains, NAF’s press release attempted a bit of lame spinning, comparing 2011 to 2009 in order to lead with an 18% increase stat.
The release also includes the following quote from director of internet and IP services Kristine Dorrain, which seems to be designed to subtly address the “complainant-friendly” allegations.

Our experience tells us parties, particularly domain name registrants, prefer the National Arbitration Forum because documents are easily accessible in our online portal. Complaint or Response filing is accomplished in just a couple of minutes.

It’s a somewhat irrelevant statement, given that it’s the complainant who gets to choose the venue.
One of NAF’s 2011 highlights was being picked as exclusive provider of Rapid Evaluation Service cases by .xxx manager ICM Registry. It processed 10 RES complaints in 2011.
RES cases, as well as 73 .us cases, were counted in its headline statistics.

WIPO releases 2011 cybersquatting stats

WIPO handled more UDRP cases covering more domain names in 2011 than in any other year, but its numbers do not paint a very convincing picture of the cybersquatting landscape.
The organization today announced that it handled 2,764 UDRP cases covering 4,781 domain names last year. The number of cases was up 2.5% over 2010.
The number of domain names covered by these cases was up by 9.4% – an additional 414 domains.
It’s basically meaningless data if you’re looking to make a case that cybersquatting is on the increase.
Obviously, while WIPO is the market-share leader, it is not the only UDRP provider. It sees a representative but non-exhaustive sample of cases.
While UDRP is the standard dispute mechanism for all ICANN-contracted gTLDs, WIPO also has side deals with ccTLD registries to look after cybersquatting cases in their zones.
As WIPO has added more ccTLD deals, it has become harder to make apples-to-apples comparisons year over year.
Based on WIPO’s own records, it received 2,323 UDRP complaints about domains in gTLDs last year, up by 28 cases from 2010, a 1.2% increase.
Given that the number of domains registered in gTLDs increased by at least 8% between January 1 and November 30 2011, cybersquatting seems to be actually on the decrease in relative terms.
And given that the number of UDRP cases filed is so piddlingly small, a single obsessive-compulsive complainant (ie, Lego) can skew the results.
Lego spammed WIPO with more than 160 complaints in 2011. As a result, Denmark is the last year’s fourth-biggest filer after the US, France and UK, according to WIPO, with 202 complaints.
So, if you see any company using these WIPO numbers to rage about cybersquatting in press releases, ICANN comments or Congressional hearings, give them a slap from me. Thanks.
Here’s a table of WIPO’s caseload from 2000 to 2011.
[table id=6 /]
Sadly, the number of UDRP complaints will never reflect the actual amount of cybersquatting going on, particularly when cybersquatters only need to price their domains more cheaply than the cost of a UDRP complaint in order to stay off the radar.
WIPO’s data does raise some interesting questions about the geographic distribution of complainants and respondents, however.
Unsurprisingly, cybersquatting was found to be big business in China, the second most-common home nation, after the US, for respondents. No UDRPs filed with WIPO originated there, however.
Surprisingly, Australia is ranked fourth on the list of countries most likely to harbor alleged squatters, with 171 respondents. But Australia was 13th in terms of complainant location, with just 39 cases.
Read more WIPO data here.

First .xxx cybersquatting complaint filed by porn site

The new .xxx top-level domain has seen its first cybersquatting complaint filed by a porn site.
The registrant of the domain femjoy.xxx was hit by a UDRP complaint in with the World Intellectual Property Organization late last week.
FemJoy.com is a well-known “artistic nude” porn site, according to the adult industry trade press.
While there have already been 12 UDRP cases filed against .xxx registrants, the previous cases have all been filed by the owners, such as banks and retailers, of non-porn trademarks.
The femjoy.xxx case appears to be the first instance of a cybersquatting complaint filed by a porn site.
Complainant Georg Streit has owned a US trademark on “FemJoy” – covering “magazines and periodicals featuring photographs and images of landscapes and human bodies” – since 2007.
The registrant of femjoy.xxx is an Australian called Tu Nguyen, according to Whois records. The domain does not currently resolve. In fact, it doesn’t even have name servers.

IGOs plead for special new gTLD protections

Twenty-eight intergovernmental organizations, including the UN, ITU and WIPO, have asked ICANN for special protection for their acronyms in the new top-level domains program.
A letter sent to ICANN earlier this week and obtained by DI, reads:

we formally request ICANN to make provision for a targeted exclusion of third party registrations of the names and acronyms of IGOs both at the top and second level, at least during ICANN’s first application round and until further appropriate policy could be developed.

It goes on to claim that fighting abusive domain registrations and enforcing rights diverts funds from causes such as famine relief, scientific research and children’s rights.
For the sake of brevity, this is the list of the letter’s signatories in acronym form only: AfDB, EBRD, ESO, CERN, ESA, IADB, IAEA, IFAD, ILO, IMO, IMF, IOM, ITU, NIB, NATO, OECD, OPCW, UN, UNESCO, UNIDO, UPU, WB, WHO, WIPO, WMO, UNWTO, and WTO.
The letter justifies its request by citing the rights given to IGO names under the Paris Convention for the Protection of Industrial Property.
It’s a pretty flimsy argument. The Paris convention does not give IGOs exclusive rights to strings. It may protect the World Bank abbreviation WB, for example, but not to the extent that Warner Brothers can’t also use it to market movies.
The letter also cites ICANN’s Governmental Advisory Committee, which called for IGOs to be protected in its March 2007 GAC Principles regarding New gTLDs advice.
The Principles, however, talk about IGOs in the same breath as regular trademark owners, which is exactly how the new gTLD Applicant Guidebook treats them today.
There is some ICANN precedent for giving in to this kind of special pleading, however.
The latest Guidebook makes several dozen trademarks relating to the Red Cross, Red Crescent and Olympic movements “ineligible for delegation” as gTLDs, but offers them no second-level protection.
It was noted at the time the decision was made – at the behest of the GAC – that giving the Olympics special treatment would create a slippery slope to a full-blown Globally Protected Marks List, a concept ICANN has already rejected.
The UN et al only really have a shot at getting what they want if they can get the GAC on side, and several influential GAC members have already stated that the Olympic/Red Cross case was unique.
I think the response from ICANN will be a letter from president Rod Beckstrom politely declining the request and inviting its signatories to participate in the ICANN community.

Over 7,500 .uk cybersquatting cases heard

Nominet is celebrating the 10-year anniversary of its Dispute Resolution Service this week, saying that it has settled over 7,500 cybersquatting cases.
Based on a £15,000 estimated cost of legal action, the .uk registry reckons DRS has saved companies about £110 million ($176 million) over the last decade.
DRS has similarities but differences to UDRP. Notably, DRS has a formal mediation phase and an appeals process for registrants who believe their domains were wrongly taken from them.
The .uk zone currently has fewer than 10 million registrations, compared to the 135 million gTLD domains to which the UDRP applies.
WIPO and the National Arbitration Forum have settled about 35,000 UDRP complaints over the last decade. With that in mind, cybersquatting enforcement in .uk appears to have been relatively heavy.

Will URS really be as cheap as ICANN says?

I’m having a hard time believing that trademark holders will be able to enforce their rights in new top-level domains for just $300.
The Uniform Rapid Suspension policy (pdf) is one of the new systems ICANN is putting in place to deter cybersquatters from abusing trademarks in new gTLDs.
It’s very similar to the existing UDRP, but it’s quicker and it only deals with the suspension – not transfer – of infringing domain names.
No URS arbitration provider has yet been appointed, but ICANN’s Applicant Guidebook, which spells out the policy, currently estimates a price of $300 per single-domain filing.
At least twice during the newdomains.org conference in Munich this week I heard ICANN representatives quote a price between $300 and $500.
I’m wondering how realistic this is.
Typically, domain arbitration fees are split between the provider, which receives a third, and the panelist, who receives the remaining two thirds.
With a $300 fee, that’s $100 to the provider and $200 to the sole panelist – who must be an experienced trademark lawyer or similar – compared to a $500/$1,000 split with the UDRP.
My question is: how many trademark lawyers will get out of bed for $200?
The URS gives panelists between three and five days to come up with a decision, but I’m guessing that you’d be lucky, for $200, to buy three to five hours of a panelist’s time.
Even I charge more than $200 for half a day’s work.
The Rapid Evaluation Service recently introduced by ICM Registry, which serves essentially the same purpose as URS but for the .xxx gTLD, costs $1,300 in National Arbitration Forum fees.
Like URS, the RES is designed for a speedy turnaround – just three days for a preliminary evaluation – of clear-cut cybersquatting cases.
Like URS, complaints submitted using RES have a tight word-count limit, to minimize the amount of work panelists have to do.
With that in mind, it seems to me that a $300 fee for URS may be unrealistic. Even the $500 upper-end ICANN estimate may be optimistic.
It will be interesting to see if ICANN’s negotiating clout with likely URS providers is better than ICM’s and, more importantly, to see whether $200 is enough to buy consistent, reliable decisions from panelists.

Lego overtakes Microsoft in cybersquatting cases

Lego has now filed more complaints against cybersquatters than Microsoft.
The maker of the popular building block toys has filed 236 cases using the Uniform Dispute Resolution Policy since 2006, the vast majority of them since July 2009.
That’s one more than Microsoft, about 50 more than Google and twice as many as Viagra maker Pfizer.
Lego has been particularly aggressive recently. As I’ve previously blogged, Lego lately files a UDRP complaint on average every three days.
The company is usually represented in these cases by Melbourne IT Digital Brand Services, the online trademark enforcement arm of the Aussie registrar.
The 236 cases equates to over $350,000 in WIPO fees alone. I’d be surprised if Lego has spent less than $1 million on UDRP cases over the last few years.
Lego has annual revenue of about $1.8 billion.
It has never lost a case. The company either wins the dispute, or the complaint is terminated before a finding is made.
It’s picked up some oddities along the way, notably including legogiraffepenis.com and legoporn.com.
Yet Lego does not appear to have the most UDRP cases under its belt. I believe that honor may go to AOL, which has filed at least 277 cases over the last decade.