How one guy games new gTLD sunrise periods

Wanna buy a SOCIAL brand pen for a dollar? No? How about social.web or cloud.guru or direct.flowers?
One intellectual property lawyer closely associated with a number of new gTLD registries has been using a flimsy online pen-selling business in order to obtain potentially valuable domains during sunrise periods.
Thomas Brackey of Beverley Hills law firm Freund & Brackey has acquired dozens of premium domain names during sunrise periods. He was good enough to share some of the details with DI.
Brackey owns three trademarks on the terms “DIRECT”, “SOCIAL” and “CLOUD”. All three were registered in Switzerland in late 2012, having been applied for in July that year.
All three cover the category “stylos”, or pens.
If you want to buy a CLOUD brand pen, you can do so at pentm.ch, a web site Brackey seems to have thrown up rather quickly using Shopify.
All three marks appear to have been registered via Marcaria.com, which charges $960 for a Swiss trademark registration.
Brackey obtained Trademark Clearinghouse registrations for his three trademarks, which would have cost him at least $150 per mark.
He seems to have used the pentm.ch web site to fulfill the TMCH’s “proof of use” requirement.
With TMCH registrations, he’s able to participate in new gTLD sunrise periods, giving him the first opportunity to register social.tld, cloud.tld and direct.tld for the usual inflated sunrise prices.
The pens themselves, Brackey assures us, are real.
But he makes no attempt to pretend that the pen-selling business was in thriving need of brand protection under the new gTLD program’s brand protection mechanisms.
Brackey told DI:

In the course of preparing new gTLD applications, I came to be pretty familiar with the various policy developments surrounding the creation and implementation of the TMCH.
For the first time mark holders of all stripes, and from every country would be given a pre-emptive right to acquire domain names that had nothing to do with the substance of their brands.
Musing on that, I identified what I believed to be a legitimate opportunity to acquire some domain names in the newTLD landscape. More curious than anything, I decided to put my theory to the test and resolved to try buying some domain names.
I’m not sure what I’m going to do with the domains I’ve purchased. I’ve never been a domain investor before, and not confident I qualify as one now. It’s all a bit of an experiment at this point and is certainly fascinating territory from an IP perspective.
There will no doubt be a number of important international legal developments that arise from the gTLD process — new rules, new policies and new opportunities.

At least two of Brackey’s new gTLD clients — What Box? and Plan Bee, which use Brackey’s law firm as their mailing address — have also registered large numbers of sunrise names using this same method.
He’s even selling Plan Bee’s “CONSTRUCTION” and “BUILD” pens on his web site.
Brackey acknowledged that some people take a “pretty dim view” of what he’s doing.
I’d have to say I’m one of them.
In my view, while Brackey may not be strictly breaking the rules of the new gTLD program, he’s certainly not acting within their spirit.
Members of Intellectual Property Constituency and others fought hard for rights protection mechanisms that would help them protect their or their clients’ pre-existing brands from cybersquatters.
The RPMs were not designed to provide a way for investors to avoid landrush auctions or a mad scramble for nice names on the first days of general availability.
The “proof of use” requirement was added to the rules in order prevent the kind of debacle we saw with the European Union’s .eu launch, where bogus trademarks were used to game EurID’s sunrise period.
But the barrier is tissue-thin, requiring merely a screenshot of a web site to overcome.
Gaming new gTLD sunrise periods may not be cheap — it may not even be profitable — but I have to wonder what kind of reputational impact it will have on new gTLD registries that choose to participate.
If you’re a brand owner, would you be more likely or less likely to trust a new gTLD registry that chooses to participate in sunrise gaming?

22 Comments Tagged: freund & brackey, gaming, plan bee, sunrise, thomas brackey, what box

dotBest cancels landrush

PeopleBrowsr has decided to cancel the landrush phase for its forthcoming .best new gTLD, citing “very little engagement” from registrants.
The TLD is due to go to sunrise today. Two days after it ends on May 19, it will go directly to general availability.
VP of operations Michael Deparini said in an email:

Many of our registrars have given us feedback that there has been very little engagement with the TLD Landrush Phase. We have decided to cancel Landrush.
We are excited to announce that we will open General Availability (GA) ahead of schedule to commence on May 21 at 16:00:00 GMT (12pm EST).

PeopleBrowsr is also the company behind .ceo, which launched two weeks ago with just 250 names in its first couple of days on the market — about 40% of which belonged to one cybersquatter.
.ceo currently has 798 domains in its zone, making it the fourth-smallest of the 74 new gTLDs that currently appear to be selling names.

Comment Tagged: .best, ceo, dotbest, landrush, new gTLDs, peoplebrowsr, sunrise

New gTLD domains top 500,000 as Schilling goes on parking spree

The total number of new gTLD domains broke through half a million for the first time yesterday, but it seems to be due to Frank Schilling obtaining tens of thousands of names in his own TLDs.
Uniregistry’s .link became the fifth-largest new gTLD, moving almost 20,000 names, but it appears that the vast majority are registered to a company affiliated with CEO Schilling.
Uniregistry’s other gTLDs — .tattoo, .sexy, .pics, .photo and .gift — all saw huge jumps too, apparently for the same reason.
This morning’s .link zone files show a pop of 19,945 names, to a total of 20,050.
That would be the third-best GA-day performance, after .guru and .berlin, of any new gTLD to date, but it seems the vast majority are actually premium names acquired by a Uniregistry affiliate.
Of those new .link names, 18,272 (91%) are being parked on internettraffic.com, another Schilling company.
I took a random sampling and found them all registered to North Sound Names, a company based on Seven Mile Beach in Grand Cayman, which is where Schilling lives.
Schilling said this on Twitter yesterday:

@TimJamesDomains @DomainNameWire .. they are the company that has done a deal for our premium names

— Frank Schilling (@Frank_Schilling) April 15, 2014

Premium names are of course those that were reserved by the registry. So either a third-party has bought them wholesale, or Uniregistry has simply shifted them over to an affiliated company.
I’ve asked Schilling to confirm that North Sound Names is also his company and will update this post with his answer.
Testing some domains in Uniregistry’s other gTLDs, I found a similar pattern — big spike, mostly parked at internettraffic.com, North Sound Names in a sampling of the Whois.
Here’s a screenshot of today’s best-performing new gTLDs from DI PRO (click to enlarge):

Overall, six of Uniregistry’s new gTLDs grew by a total of 50,735 domains today — 95% of the 53,147 industry total — and internettraffic.com’s name servers are responsible for 37,668 new names.
This brings the total number of “registered” domains to 538,093, though I would suggest that this metric may no longer be a decent measurement of actual end user interest in new gTLD domains.

25 Comments Tagged: .link, new gTLDs, uniregistry

Pricey .luxury made $500k already

The new gTLD .luxury seems to have sold more than $500,000 worth of domain names already.
(UPDATE: That’s probably not accurate. I seem to have misread some registrar pricing pages. The sunrise price was actually much lower than $1,000. See comments below.)
Saturday’s zone file for the Luxury Partners-owned TLD popped from 1 domain to 470 domains. Most of the new names appear to have been registered during the sunrise period, which ended early last week.
Given the current retail price of over $1,000, it seems .luxury is already a $500,000 business, at least for 2014. Renewal pricing is around the $700 mark, equating to $329,000 a year just on sunrise registrations.
That’s including the registrar markup, of course. The registry will be making a bit less.
“Luxury” brands such as Cartier and Formula 1 bought multiple domains during sunrise. Some tech firms, such as Facebook and Google, continued their blanket approach to defensives.
With such a high price, one wonders what some of these rights holders are thinking: do they really believe cybersquatters are prepared to drop $700 a year infringing their brands?
Sadly there are already a couple of examples of newbie squatters spending absurd sums on clearly infringing new gTLD domains.
It will be interesting to see whether any of these registrants actually use their domains, or whether they’re mainly defensive registrations. I suspect the latter will be more often the case.
Currently in landrush, .luxury is due to go to general availability in about a month.

5 Comments Tagged: .luxury, landrush, luxury partners, new gTLDs, sunrise

Belgium comes out against Donuts’ .spa bid

Belgium wants Donuts’ application for .spa rejected after the new gTLD applicant declined to sign a deal with the city of Spa.
In a March 20 letter to ICANN, published today, the Belgian deputy prime minister Johan Vande Lanotte said “negotiations between the stakeholders are closed”, adding that Belgium:

requests the Board of Directors of the ICANN to delegate the new “.spa” gTLD to the candidate who has a formal agreement with the local authorities of Spa and in respect of the public interest.

That’s the other applicant in the two-horse .spa race, Asia Spa and Wellness Promotion Council, which has promised to earmark up to 25% of its European profits to spa-related uses in the environs of Spa.
The letter was sent a week before the Governmental Advisory Committee issued its Singapore communique, which noncommittally noted that it “welcomes” the agreement between Spa and ASWPC.
ICANN may or may not be currently in receipt of firm, consensus GAC advice to accept or reject either of the remaining .spa applications.
In Beijing a year ago, the GAC put .spa on a list of gTLD strings where “further GAC consideration may be warranted” and asked ICANN to “not proceed beyond Initial Evaluation”.
At the Durban and Buenos Aires meetings last year the GAC said ICANN should not “proceed beyond initial evaluation until the agreements between the relevant parties are reached.”
Given that Donuts and Spa evidently cannot come to an agreement, ICANN presumably remains advised to keep one or both .spa applications on hold. The advice is pretty vague.
The string “spa” is not a geographic name within the rules of the new gTLD program. Donuts argues that it’s too generic nowadays to belong just to Spa.

3 Comments Tagged: .spa, gac, governmental advisory committee, ICANN, new gTLDs

Geo gTLDs catch a break with new launch rules

New gTLDs with a geographic or community focus have won concessions from ICANN under new rules published today.
All new gTLD registries will be able to allocate names to public authorities, matching for example district names or landmarks, even if those names match trademarks in the Trademark Clearinghouse.
The change came in the final version of the Qualified Launch Program guidelines, which spells out how new registries are able to allocate up to 100 names, pre-sunrise, to anchor tenants.
The new language related to public authorities reads says that any registry, may give names to any “international, national, regional, local or municipal governmental authority”.
Such domains must match “the name of a building, park, monument, airport or other public place… region, city, street, district or other geographic area” operated by the authority, the name or acronym of the authority itself, or the name of one of its public services.
The carve-out would allow (to use a Minds + Machines example), the .london registry to give thepolice.london to the Metropolitan Police, even if the Sting-fronted band The Police had a matching mark in the TMCH.
The newly amended rules apply to all new gTLDs, not only those that were classified as “geographic” under ICANN’s rules. So they would apply to .scot, for example, even though it’s not strictly a geographic name.
But the QLP still would prevent registries allocating a TMCH-listed string to anyone prior to their sunrise period concluding, unless the entity getting the name also owned the TMCH listing.
The new QLP rules are available here.

Comment Tagged: ICANN, new gTLDs, qlp, qualified launch program

Famous Four wins .party gTLD contest

Famous Four Media has won the .party new gTLD contention set after coming to a private agreement with the only other applicant for the string, Oriental Trading Company.
Financial details of the arrangement were not disclosed.
Oriental Trading is a supplier of party goods that intended to run the gTLD as closed, single-registrant namespace.
But Famous Four expects the open .party registry to be used for parties in the social gathering and political senses of the word.
It now has 13 uncontested applications and 44 more outstanding.
In related news, Minds + Machines today announced that it intends to take at least three of its applications — .garden, .property, and .yoga — at a private auction April 22 managed by Applicant Auction.

Comment Tagged: .party, contention, domain venture partners, famous four, ICANN, Minds + Machines, new gTLDs, oriental trading

Republicans advance “embarrassing” DOTCOM Act

Republican US Congressmen today voted to advance the DOTCOM Act, which would add a delay of up to a year to the IANA transition.
The Communications and Technology Subcommittee voted 16 to 10, split directly along party lines, to advance the bill to the next stage of the US legislative process.
The bill (pdf) has been changed since last time I reported on it. For ICANN, the change is for the worse.
It would now block the National Telecommunications and Information Administration from approving ICANN’s proposal for an NTIA-free future for up to one year while the Government Accountability Office prepares an analysis.
In the first draft, that delay would begin at the moment the bill hit the statute books. Now, the clock starts when the proposal is made.
Democrats on the subcommittee, who had four amendments shot down by the Republican majority during a markup session today, said the bill makes a mockery of the multistakeholder process they all profess to endorse.
Ranking member Anna Eshoo noted that Democrats supported a GAO report, but did not want the NTIA’s hands tied.
She reminded her opponents that they had all voted for a bill in 2012 — shortly before the International Telecommunications Union met for its WCIT conference — affirming the United States government’s commitment to multistakeholder management of the internet.
“Today you are unraveling exactly what you voted for,” she said, accusing Republicans of seeing “black helicopters” and a “conspiracy” by President Obama to give the internet to authoritarian regimes.
“It’s a source of embarrassment for a committee that has for the most part operated in a very respectful bipartisan way,” he said.
Republicans in response said that it is not unreasonable to request a GAO report, to help them understand the possible consequences of the IANA transition.
Rep John Shimkus, the primary sponsor of the DOTCOM Act, said that the forced delay was needed to give the bill “teeth”. Without it, he said, the GAO report could come after the IANA transition has already taken place.
In a concurrent hearing elsewhere on Capitol Hill, ICANN CEO Fadi Chehade was busy explaining to a different committee why he could not support the bill.
The DOTCOM Act would give the impression that the US government does not take the multistakeholder model seriously and does not trust ICANN, he said.
While Republicans may feel like the bill will keep the DNS root out of the hands of Russia and China, what they’re actually doing is giving those nations fuel for their power grabs in government-led international fora such as the ITU, in other words.
The DOTCOM Act is not yet law. It still has to go through the full House (Republican-controlled) and Senate (Democrat-controlled) and be signed by President Obama (China-controlled) before it hits the statute books.

20 Comments Tagged: dotcom act, iana, iana transition, ICANN, ntia

ICANN sets ball rolling on IANA transition

ICANN has put the wheels in motion towards the ultimate transition of the IANA functions from the stewardship of the US government.
The organization put forward a proposal this morning, apparently compiled from views gathered at the ICANN 49 meeting in Singapore and mailing list suggestions.
It’s a proposal for a process to develop process to develop a proposal:

Call for Public Input: Draft Proposal, Based on Initial Community Feedback, of the Principles and Mechanisms and the Process to Develop a Proposal to Transition NTIA’s Stewardship of the IANA Functions

Basically, ICANN is proposing that a new “steering group” be formed, tasked with leading the development of a proposal to transition the stewardship of the IANA out of the hands of the US government.
ICANN hopes to have it sitting by the ICANN 50 meeting in London this June, but right now it wants your comments on whether this group should be created, who should be on it, and what it would do.
The idea is that the group would create a process for the community to create the IANA transition proposal.
The proposal itself would be created by the “community” and presumably put into written form by the steering group.
Whatever was agreed upon would be submitted to the US National Telecommunications and Information Administration for approval, probably before the IANA contract expires in September 2015.
It is complicated, but the gist of it is that everyone gets a say and every discussion will be had in the usual glare of ICANN transparency.
Who’s on the committee?
The steering committee would comprise 22 members and an ICANN board liaison.
Two members would be drawn from the each of the following ICANN bodies: GNSO, ccNSO, ASO, ALAC, RSSAC, SSAC, GAC.
Two members would come from each of these external IANA-user bodies: IAB, ISOC, IETF, NRO.
Here’s a friendly ICANN illustration:

For those of you worried about Russia, China, etc, taking over the internet, allow me to state this in layman’s terms: there would only be two government representatives on the panel.
I guess there could be three or four, in the unlikely event that one or both ccNSO representatives comes from a government-run ccTLD. Either way, it’s a small minority of the group.
In terms of pure numbers the geeks would rule the committee, with wonks, lawyers and industry folk making up the remainder.
I can see the GNSO wanting more spots. The domain industry, non-commercial users and IP interests are all in the GNSO and all have divergent views. Two seats, the GNSO might argue, might not be enough.
That said, many members of advisory committees such as the SSAC and RSSAC are firmly from the registry side of the industry, so industry may have a bigger seat a the table.
Which parts of the community get what portion of representation is going to depend on who puts themselves forward and who gets picked to participate.
The committee members would be selected by ICANN chair Steve Crocker and GAC chair Heather Dryden from the pool of people who volunteer.
What would it do?
The steering group, as mentioned, is supposed to guide the community discussions, taking input from everyone. It doesn’t seem to be a working group in the usual ICANN sense, where only members have a voice.
The process of gathering this input would be designed by the committee itself, adhering to principles such as timeliness, outreach and consensus.
Whatever transition proposal was ultimately presented would have to adhere to the NTIA’s guidance on what it’s looking for, which includes the “no intergovernmental solution” rule.
In this diagram, the green bits are the blanks that the community is being asked to fill in.

A good question might be to ask what its job is not, which is answered in a new “scoping document” (pdf) that ICANN published today.
For example, while I wrote an article earlier this week suggesting that the Governmental Advisory Committee needs to have its internal rules put in check before a transition, that would be outside scope. ICANN says:

As NTIA currently plays no unique role in the development of policies for the coordination of the Internet’s domain name system, the proposal is not about how relevant policies are created, nor the relevant structures in which they are created.

The process is not about reforming how ICANN works, in other words, it’s about creating some kind of accountability mechanism to replace the NTIA.
I have no clue what that would look like. Probably a committee or something. More bureaucracy, no doubt.
The fundamental problem, it seems to me, is that the NTIA doesn’t actually do anything. Any true replacement would therefore have to be redundant by design.
The only function the NTIA has actually played over the last 16 years is as a sword of Damocles, a constant threat that if ICANN goes rogue it will lose its IANA contract.
That’s not something that can be replaced, surely? And if the multi-stakeholder process works as well as ICANN claims it does, surely it doesn’t even need to be replaced.
Perhaps I simply lack imagination.
Anyway, because this is a multi-stakeholder process, you (yes, even you!) can read today’s proposal here and submit your comments to the email address provided.

Comment Tagged: iana transition, ICANN, ntia, steering group

Four governments file ICANN appeals over .wine

France, Spain, the UK and the European Commission have formally appealed ICANN’s decision to allow the .wine and .vin new gTLD applications to proceed.
In doing so, they’ve become the first national governments to file Requests for Reconsideration with ICANN since the process was introduced in 1999.
All four governments are demanding that ICANN take another look at its March 22 resolution in which it said .wine and .vin could be taken off hold and proceed through the remainder of the new gTLD process.
The four applications in question (three for .wine, one for .vin) have been frozen since the Beijing meeting a year ago, at which the Governmental Advisory Committee said it needed more time to consider them.
European nations, with some Latin American support, think that wine-related gTLDs should not be approved unless the applicants agree to give special protection to geographic indicators, such as “Champagne”.
The RfRs are all, as you might expect, a bit “inside baseball”, focusing on the minutiae of ICANN’s bylaws.
What’s illegal and what isn’t?
A key concern is that ICANN’s New gTLD Program Committee, in passing the resolution, relied in part on an analysis of the legal issues (pdf) conducted by French law professor Jerome Passa.
Passa concluded that there’s nothing under the law to prevent ICANN assigning .wine to Donuts, one of the applicants, because “wine” is not a protected GI string.

As regards the applications for the assignment of the new gTLDs ‘.vin’ and ‘.wine’ filed by the Donuts company, there is no rule of the law of geographical indications, nor any general principle which obliges ICANN to reject the applications or accept the applications under certain specific conditions.

From my reading of Passa’s opinion, a domain name containing a GI would only be illegal if it was used to sell counterfeit wines.
For example, it would be perfectly okay for a Chinese registrant to own champagne.wine if he used it to sell genuine champagne from Champagne, but it would be uncool if he used it to sell champagne-style sparkling wine.
Passa doesn’t seem to think it would be necessarily illegal for a registry to sell that domain, or for ICANN to delegate a .wine gTLD that could possibly be abused by said registrant in future.
The four governments are not so much concerned by his legal arguments (though they do disagree with them), but rather by the fact that the GAC was not shown Passa’s opinion before the NGPC made its decision
Under section XI-A of ICANN’s governing bylaws, the GAC “shall have an opportunity to comment upon any external advice received prior to any decision by the Board.”
By not giving Passa’s analysis to the GAC prior to its March 22 resolution, the NGPC violated ICANN’s bylaws, the four governments argue.
However, ICANN has already responded to this argument and others, suggesting that the four new RfRs may already be dead in the water.
In a resolution last Thursday the NGPC stated that the bylaws were not broken because the requirement to show the GAC “external expert advice” only applies when the board is determining matters of policy.
An explanation of last week’s NGPC decision says:

the NGPC has concluded that there was no process violation or procedural error under the Bylaws, particularly because the Independent Legal Analysis was not sought as External Expert Advice pursuant to Article X1-A, or any other Bylaws provision. Rather, the Independent Legal Analysis was sought pursuant to Module 3.1 of the Applicant Guidebook, and partly at the GAC’s suggestion.

Basically, it’s round two the old “policy versus implementation” debate, in which the ICANN board and GNSO Council have regularly sparred, kicking off with new opponents.
Spain argues in its RfR that the bylaws “the supreme governing rules” of ICANN, apply to implementation matters too and that there’s “no legal basis” for ICANN’s finding that they only apply to policy.
It further notes that a legal analysis of the related .amazon new gTLD controversy, also written by Passa, has been circulated to the GAC for comment as per the bylaws.
Disturbing views on “consensus”
In order for an RfR to be successful, complainants have to show that the ICANN board or NGPC did not consider all the evidence they should have at the time of their decision.
The governments are only slippery ground here, as all they can seem to point to are the barrage of letters that have been sent to ICANN by wine producers, associations and governments over the last year or so.
It may not have mentioned each one explicitly in its resolution but it’s very unlikely, in my view, that the NGPC was not aware of these letters when it made its call.
More significantly, these objecting governments are arguing that the NGPC was misled by GAC chair Heather Dryden about the extent of “consensus” in the GAC with regards .wine and .vin.
Dryden told ICANN in a September 9, 2013 letter that the GAC had not reached a consensus to object to the two new gTLDs, so they could proceed.
It appeared that the GAC — with members such as the US, Canada and Australia disagreeing with Europe — had simply hit an immovable brick wall in its talks, so consensus was never going to be reached.
France states in its RfR that the Dryden letter was sent without first consulting the GAC:

The GAC Chair’s statement that “The GAC has finalised its consideration of the strings .wine and .vin and further advises that the applications should proceed through the normal evaluation process” is not a consensus view of the GAC as per the aforementioned Operating Principle, but a mere interpretation and opinion of the GAC Chair.

Where France’s opinion, which seems to match previous statements by the European Commission, gets disturbing is in its interpretation of what “consensus” means. It wrote:

in reality a significant number of GAC members were in consensus not to allow the .WINE and .VIN applications to proceed through evaluation until sufficient additional safeguards were in place. The reality is that the GAC as a whole could not reach consensus, what does not necessarily imply that the strings can proceed through the normal evaluation process without further consideration.

It’s worded awkwardly, but France seems to be saying that agreement among a certain subset of GAC members (ie, the Europeans) somehow constitutes a GAC consensus that the applications should be indefinitely delayed.
It’s disturbing close to arguing for majority rule on the GAC, which as I explained in depth earlier this week is something to be avoided at all costs.
Anyway, that’s the second prong of the RfR attack: whether the NGPC had been misled about the GAC’s views.
The four separate RfRs appeared on the ICANN web site today. The file labeled as being from the European Commission appears to be a copy of the French one; possibly an uploading error.
UPDATE: It was an uploading error. You can find a copy of the European Commission RfR here (pdf).

Comment Tagged: .vin, consensus, gac, gac advice on new gtlds, geographic indicators, ICANN, new gTLDs, reconsideration, wine