ICA demands probe of “shoddy” UDRP decisions

The Internet Commerce Association has called for an ICANN investigation into the National Arbitration Forum’s “seriously flawed” record of UDRP decisions.
The demands follow two recent NAF cybersquatting cases thought to be particularly egregious.
In the first, Hardware Resources, Inc. v. Yaseen Rehman, the domain hardwareresources.org was transferred based on a trademark that explicitly denounced rights to the term “hardware resources”.
In the second, Auto-Owners Insurance Company v. Nokta Internet Technologies, NAF allegedly broke from standard UDRP procedure when it handed autoownersinsurance.com to the complainant.
Both were cases of potentially valuable generic domains being lost, and both were recently singled out by IP attorney Paul Keating as being particularly dubious decisions.
The ICA represents some big domainers and some of the big domaining registrars. Its counsel, Phil Corwin, wrote to ICANN yesterday to demand a review of NAF’s practices:

NAF’s administration of the UDRP in the cases cited above appears to be seriously flawed and creates the appearance of substantial bias and ineptitude. ICANN has a responsibility to make serious inquiry into this matter and to take remedial action based upon its findings.

According to Corwin, there’s circumstantial evidence that NAF encourages “forum shopping” due to its habit of appointing a small number of adjudicators known to be friendly to complainants.
Regular readers of DomainIncite and other domain industry news blogs may have noticed that when we report incredulously about UDRP decisions, it’s usually with reference to NAF cases.
Corwin’s letter comes as part of a larger ongoing campaign by the ICA to get ICANN to sign formal contracts with its approved UDRP resolution providers, which it lacks today.

How many defensive registrations is too many?

How will ICANN measure the success of its new top-level domains program, and how many defensive registrations is too many?
These questions are now firmly on the ICANN agenda, following the publication of 37 draft recommendations for how to measure the success or otherwise of new gTLDs.
The advice of the Consumer Trust Working Group, published last night and now open for public comment, is a must-read for anyone interested in the emerging new gTLD market.
The recommendations describe myriad ways ICANN could benchmark the performance of new gTLDs three years from now, to fulfill its promise to the US Department of Commerce to study the effect of the program on consumer choice and competition.
While it’s a broad document covering a lot of bases, I’m going to be disappointingly predictable here and immediately zero in on the headline wedge issue that I think will get most tongues wagging over the coming weeks and months:
Defensive registrations.
The working group decided to recommend that, as a measure of success, domain name registrations in new gTLDs should be no more than 15% defensive* three years after launch.
Defensive in this case would mean they were registered during the mandatory Sunrise period.
The idea is that consumer choice can be demonstrated by lots of registrations in new gTLDs, but that defensive registrations should not count toward that goal.
The 15%-Sunrise baseline number was chosen fairly arbitrarily – other suggestions were 20% and 12% – and is designed to spur community discussion. It’s not final.
Still it’s interesting.
It implies that if a registry has 15,000 Sunrise registrations, it needs to sell another 85,000 domains in three years to be seen as having made a successful contribution to consumer choice.
By way of an example, if it were to be retroactively applied to .xxx, the most recent gTLD to launch, ICM Registry would have to get its total registrations up to 533,000 by the end of 2014.
Is 15% too low? Too high? Is it even a useful metric? ICANN wants to know.
Whatever the ultimate number turns out to be, it’s going to be handy for plugging into spreadsheets – something opponents of new gTLDs will find very useful when they try to make the case that ICANN endorses a certain dollar value of trademark extortion.
Because many registries will also accept defensive registrations after Sunrise, two more metrics are proposed.
The group recommends that domains in new gTLDs that redirect to identical domains in legacy TLDs – strongly implying a defensive registration – should be no more than 15% after three years.
It also recommends that ICANN should carry out a survey to see how many registrants own matching second-level domains in legacy TLDs, and that this should also be lower than 15%.
I’ve only outlined three of the working group’s recommendations here. Many of the other 34 are also interesting and will be much-debated as the new gTLD program continues.
This is vitally important stuff for the future of new gTLDs, and applicants would be well advised to have a good read — to see what might be expected of them in future — before finalizing their applications.
* It should be noted that the recommendation as published confusingly reads “Post-Sunrise registrations > 15% of total registrations”, which I think is a typo. The > operator implies that non-defensive registrations only need to be over 15% of total registrations, which I’m certain is not what the working group intended to say.
(UPDATE: this typo has now been corrected).

Europe to warn consumers about .bank “risks”

The European Banking Authority has told ICANN it believes that proposed financially-oriented gTLDs such as .bank are dangerous and should be banned.
The EBA, the European Union’s central banking regulator, said it plans to issue consumer alerts, warning people about “the risks of these new naming conventions”.
In a letter to ICANN published today, EBA chair Andrea Enria said that a global gTLD such as “.bank” would not give consumers a good guide as to whether the bank was regulated in their own country.
Financial gTLDs have a “not-yet-identified benefit” and could create a “moral hazard”, Enria wrote. The EBA is also worried about the cost of trademark enforcement, he said.

the EBA believes that it is not feasible to address most of the supervisory concerns of its members on the risks of misuse of the proposed gTLDs and calls the ICANN to reconsider its plans for allowing the such of the above mentioned gTLDs and ban the establishment of such gTLDs altogether.

The EBA was formed just over a year ago as the successor to the Committee of European Banking Supervisors. Its members are the heads of the financial regulators of the EU member states.
The letter could come as a blow to the American-led .bank application proposed by the American Bankers Association and the Financial Services Roundtable’s BITS division.
The BITS project envisages a tightly controlled namespace for banks, governed by a fairly strenuous set of security measures.
But the establishment of a .bank gTLD is one area where we are almost guaranteed to see ICANN’s Governmental Advisory Committee exercising its new-found objection powers.
If the Europeans and the Americans do not see eye to eye, .bank will not see the light of day.

Olympics warming to new gTLD bid?

ICANN’s new generic top-level domains Applicant Guidebook may be modified to make it clear that the International Olympic Committee can apply for .olympic if it wants to.
That’s judging by the current state of negotiations in an ICANN working group set up to give special protection to Olympic and Red Cross/Red Crescent trademarks.
Currently, the Guidebook contains a multilingual list of strings related to the Olympic and Red Cross brands that are completely banned from delegation as gTLDs.
But a GNSO working group seems to be rapidly veering towards a recommendation that the ban should be waived if the IOC and Red Cross decide to apply.
The IOC and Red Cross would therefore be able to get their hands on .olympic and .redcross.
Both organizations are closely involved in these talks, which suggests that they may not be entirely hostile to the idea of running their own dot-brand gTLDs after all.
The GNSO working group is also considering the idea that the Olympic and Red Cross trademarks should be protected by string similarity reviews, which is not the case currently.
This could mean, for example, that non-identical gTLDs such as .olympus might have to get IOC backing if they want their applications approved.
The GNSO Council is expected to vote to approve or reject the recommendations at its meeting in San Jose, Costa Rica next month.
It’s not clear whether this would give ICANN enough time to rubber-stamp the decision before the new gTLD application window closes to new applicants March 29.
The decision would not be non-controversial, however. Some ICANN community members are not in favor of granting special trademark protections to anyone.
The GNSO working group has also been tasked by the Governmental Advisory Committee with coming up with second-level protections for the Olympics and Red Cross, but this policy work is unlikely to bear fruit until after the new gTLD application window closes.

ICANN avoids bogus time-zone lawsuit

The company alleging that the critical internet time-zone database infringes its copyright has dropped its lawsuit, admitting that you can’t copyright historical facts.
ICANN took over maintenance of the TZ in October, after astrology software maker Astrolabe sued Arthur David Olson and Paul Eggert, who had managed it for nearly 30 years.
The database is used by countless applications and ubiquitous programming platforms, and ICANN considers it a “an essential service on the Internet” and therefore within its remit.
Astrolabe sued in the belief that the database stole copyrighted information from its own software. ICANN was not named in the complaint, even after it took over the TZ.
The Electronic Frontier Foundation helped in the defense of the case, and yesterday announced that Astrolabe has dropped the suit, apologized, and promised not to sue again.
According to the EFF, Astrolabe said:

Astrolabe’s lawsuit against Mr. Olson and Mr. Eggert was based on a flawed understanding of the law. We now recognize that historical facts are no one’s property and, accordingly, are withdrawing our Complaint. We deeply regret the disruption that our lawsuit caused for the volunteers who maintain the TZ database, and for Internet users.

In a statement on its web site today, Astrolabe says:

Moon void in Pisces. Feelings shape the trends; settings and environments shape feelings. True sacrifice succeeds; passive/aggressive behavior fails.

Indeed.

Strickling says ICANN needs a stronger bottom

National Telecommunications & Information Administration chief Larry Strickling has called for ICANN to strengthen its decision-making processes.
In a speech at the University of Colorado earlier this month, Strickling called out ICANN’s board of directors in particular, for its habit of choosing between competing views when the ICANN community fails to reach consensus via the multi-stakeholder process.
The speech went over ground covered in other recent addresses – namely, how ICANN fits into the wider international political picture.
The US is worried about moves by some nations within the Internet Governance Forum and the International Telecommunications Union that threaten to make the internet an exclusively government-run enterprise.
Developing nations in particular are likely to support such moves, as the internet is causing them to lose the revenue they make by terminating international phone calls.
An ICANN that makes decisions without true bottom-up stakeholder consensus plays into the hands of those who would replace it with a new treaty organization, Strickling suggested.
According to his prepared remarks, he said:

Organizations that convene or manage multistakeholder processes have to be vigilant to make sure they do not inadvertently interfere with the effort to reach consensus.
…
the ICANN Board increasingly finds itself forced to pick winners and losers because its policy development process does not always yield true consensus-based policy making. This is not healthy for the organization.
…
If stakeholders understand that they can appeal directly to the Board to advocate for their particular policy position, they have less incentive to engage in the tough discussions to reach true consensus with all stakeholders during the policy-development process.

Ironically, ICANN’s current public comment period into defensive new gTLD applications – which could lead to changes to its trademark protection mechanisms – was opened precisely because Strickling himself, under pressure from Congress, appealed directly to the board.
But I suspect he was actually referring to the Association of National Advertisers, which scarcely participated in the development of the new gTLD program before it was finalized but has been loudly threatening ICANN about it ever since.
As well as calling for more participation from industry, Strickling also stressed the need for more governments to get involved in ICANN, “finding a way to bring them willingly, if not enthusiastically, into the tent of multistakeholder policy-making”.
But what would an ICANN that waits for true stakeholder consensus before the board makes a decision look like?
Strickling did not offer a solution in his address, but he did refer to the Governmental Advisory Committee’s new formal definition of consensus.
Without explicitly endorsing the model, he described it like this:

if the group reaches a position to which members do not object, it becomes the consensus view even though some members may not affirmatively support the position.

I’m finding it difficult to imagine ICANN continuing to function if its board of directors also had to observe this kind of “consensus” among stakeholders before making a decision.
Trademark owners and registrars not objecting to each other’s stuff?
What would I write about?

ICANN gets 100 applicants for CEO job

Over 100 people have applied to be ICANN’s next CEO, according to the organization.
ICANN revealed last night that it was provided with a shortlist of 27 potential candidates by its headhunter, Odgers Berndtson, and that its board has interviewed 16 of them by phone.
The list has now been whittled down further for face-to-face interviews with the board of directors, and ICANN expects to select a winner by mid-April.
Watch out for unfamiliar faces in expensive suits during the Costa Rica meeting in March – I’m guessing this might be where some of the interviews take place.
Current CEO Rod Beckstrom plans to leave the organization when his contract expires in July. He’s on a starting salary of $750,000, which may explain why there’s been so much interest in the job.

Watch ICANN approve some new gTLDs

In ICANN’s world, the current new top-level domains application period is actually the fourth, not the first.
As well as the 2000 “proof of concept” round, there was the sponsored gTLD round that kicked off at the end of 2003, and the ongoing IDN ccTLD Fast Track round from 2009.
I’ve finally got around to uploading to YouTube the video of the November 16, 2000 ICANN board meeting at which .info, .biz, .name, .pro, .museum, .coop and .aero were approved.
It was a pivotal moment in the history of the domain name system, particularly starting at the 5:46 mark, when the tide turned against Afilias’ application for .web, in favor of the less attractive four-character .info.
The main reason for the switch was Image Online Design’s competing application. IOD had been running .web in an alternate root for a few years before applying to ICANN.
If the internet had had a .web for the last decade, I believe conversations we’re having about new gTLDs would be very different today.
With .web expected to be a contested gTLD this time around — perhaps by some of the same companies that applied last time — expect this 11-year-old ICANN board meeting to be cited regularly in the near future.

The video was recorded by the Berkman Center for Internet & Society at Harvard and encoded in RealPlayer format, which in 2000 meant pretty poor-quality audio and video.

Details of new gTLD batching process revealed

Some details about how ICANN will prioritize new generic top-level domain applications into batches have emerged.
The Applicant Guidebook states that gTLD applications will be processed in batches of 500, but all it says about the batching process is that it will not be random. Rather, some form of “secondary timestamp” is proposed.
The batching process is important mainly to commercial, open registries, which stand to make much more money by hitting the market early, before new gTLD fatigue sets in.
Some tantalizing hints about how batches will be created can be found in the minutes of the ICANN board of directors December 8 meeting, which were recently published.
From the minutes we learn the following:

• Applicants are not going to find out how batching will work until after April 12, when all the applications have already been received.
• The timestamp could be created by an email sent by the applicant to a specific address at a specific time, or some function within the TLD Application System.
• The system will not be biased towards specific geographic regions – ICANN will cycle through the fastest responses from each region when it creates the batches.
• There will be an opt-out for applicants for whom time is not a factor.
• Contested gTLDs will be batched with the fastest applicant.

The minutes represent ICANN’s staff’s thinking two months ago – and the conversation confused several directors – so the batching method finally selected could obviously differ.
However, if time-to-market is important for your gTLD, it might be a good idea to think about renting a server as few hops from ICANN as possible.
This is what the minutes say:

The third, and remaining option, is a secondary timestamp. This would occur after the time of the application window closing in order to provide privacy. Applicants will not be advised of the exact method until after the applications are received, which will ensure further fairness. It could be an email response to a mailbox, or the re-registration of an application, or another method. The method used will be decentralized, so that the region rom which the secondary timestamp is submitted is irrelevant. The timestamp will cycle through the regions of the world, awarding a batching preference to the top-rated application from one region, then the succeeding four regions, and continue the cycle again. In the case of contending applications, the applications will be grouped in the earliest batch where any of the contending applications are placed. There will also be an opt-out mechanism, included at the community’s request. Applicants may request to be evaluated at the end, if they prefer to be evaluated and delegated later.

Seven ICANN directors have new gTLD conflicts

Seven members of ICANN’s board of directors have self-identified conflicts of interest when it comes to the new generic top-level domains program, according to a report from its last meeting.
Chair Steve Crocker, CEO of the consulting firm Shinkuro, appears to be newly conflicted.
He was among the directors to excuse themselves before the board discussed a resolution on new gTLDs last week, but he did vote on a new gTLD resolution at its December meeting.
Crocker has previously revealed that new gTLD applicant and registry services provider Afilias has an investment in Shinkuro.
Vice-chair Bruce Tonkin is chief strategy officer at Melbourne IT, which is a registrar as well as a new gTLD consultancy, and he also excused himself.
Ram Mohan and Suzanne Woolf, both non-voting directors, excused themselves because they work for registry service providers (Afilias and Internet Systems Consortium respectively).
Non-voting liaison Thomas Narten also declared a conflict, which is a heavy hint that his employer, IBM, is poised to apply for a dot-brand gTLD.
The other conflicted directors were Sébastien Bachollet, CEO of BBS International Consulting, and Bertrand de La Chapelle of the International Diplomatic Academy.
Two directors appear to be newly unconflicted.
Kuo-Wei Wu and Thomas Roessler declared new gTLD program conflicts at the board’s December meeting but did not excuse themselves last week.
Erika Mann of Facebook missed the meeting (she also missed the December meeting) so it’s not clear whether there’s a “.facebook” conflict of interest yet.
The board of directors has 16 voting members. Nine need to be present for its meetings to be quorate.
ICANN introduced new conflict rules after former chair Peter Dengate Thrush took a job with new gTLD applicant/consultant Minds + Machines shortly after voting to approve the program last June.