Senior Demand Media exec “fired for suing ICANN”

Long-time Demand Media software architect Chris Ambler claims he was fired when his own company, Image Online Design, sued ICANN over the .web gTLD.
Ambler says he was canned by Demand October 26, eight days after IOD sued ICANN over its unsuccessful 2000-round application for .web.
He told DI on Friday that he believes he was fired unfairly and illegally and, after negotiations with Demand Media broke down last week, has retained a lawyer to explore his options for redress.
“You can’t say you’re firing somebody because they’re suing somebody,” he said. “There are legal options open to me and I am pursuing them.”
Ambler says he was hired by eNom’s then-CEO Paul Stahura in 2003 as its chief software strategist, a role in which he took a lead role in creating NameJet’s proprietary domain name drop-catching software.
When the company was acquired by Demand Media, he took the role of senior software architect.
But in the 1990s, as founder of IOD, he ran .web in an alternative DNS root system. His application to move the gTLD into the official ICANN root in 2000 was not approved.
In October he sued ICANN claiming it was “improper, unlawful and inequitable” for ICANN to solicit more applications for .web while IOD’s bid was still “pending” and unrejected.
While Demand Media is not directly applying for .web, it has an extremely tight relationship with Donuts — the portfolio gTLD applicant founded by Stahura and other former Demand executives — which is.
Demand is Donuts’ back-end registry provider and is believed to have an interest in Covered TLD LLC, the parent company of about 100 of Donuts’ new gTLD applicants, including .web.
Ambler’s contract with Demand Media acknowledged his IOD work and allowed him to pursue it, he claims.
“They’ve known for the past ten years that I was working on this,” he said.
A Demand Media spokesperson said the company does not comment on legal matters.

If the GNSO is irrelevant, ICANN itself is at risk [Guest Post]

The weeks since October’s Toronto ICANN meeting have seen some extraordinary (and, if you care about the multi-stakeholder model, rather worrying), activity.
First, there were the two by-invitation-only meetings organised in November at ICANN CEO Fadi Chehadé’s behest to iron out the Trademark Clearinghouse (TMCH).
The TMCH is one of the Rights Protection Mechanisms (RPMs) being put in place to protect people with prior rights such as trademarks from the risk of seeing them hijacked as a spate of new gTLDs come online.
The first meeting in Brussels served as a warning sign that policy developed by the many might be renegotiated at the last minute by a few. The follow-up meeting in Los Angeles seemed to confirm this.
Two groups, the Intellectual Property Constituency (IPC) and the Business Constituency (BC), met with the CEO to discuss changing the TMCH scheme. And although others were allowed in the room, they were clearly told not to tell the outside world about the details of the discussions.
Chehadé came out of the meeting with a strawman proposal for changes to the TMCH that includes changes suggested by the IPC and the BC. Changes that, depending upon which side of the table you’re sitting on, look either very much like policy changes or harmless implementation tweaks.
Making the GNSO irrelevant
So perhaps ICANN leadership should be given the benefit of the doubt. Clearly Chehadé is trying to balance the (legitimate) needs of the IP community to defend their existing rights with the (necessary) requirement to uphold the multi stakeholder policy development model.
But then the ICANN Board took another swipe at the model.
It decided to provide specific protection for the International Olympic Committee (IOC), the Red Cross (RC), and other Intergovernmental Organisations (IGOs) in the new gTLD program. This means that gTLD registries will have to add lengthy lists of protected terms to the “exclusion zone” of domain names that cannot be registered in their TLDs.
RPMs and the IOC/RC and IGO processes have all been worked on by the Generic Names Supporting Organisation (GNSO). ICANN’s policy making body for gTLDs groups together all interested parties, from internet users to registries, in a true multi-stakeholder environment.
It is the epitome of the ICANN model: rule-based, hard to understand, at times slow or indecisive, so reliant on pro-bono volunteer commitment that crucial details are sometimes overlooked… But ultimately fair: everyone has a say in the final decision, not just those with the most money or the loudest voice.
The original new gTLD program policy came from the GNSO. The program’s RPMs were then worked on for months by GNSO groups. The GNSO currently has a group working on the IOC/RC issue and is starting work on IGO policy development.
But neither Chehadé, in the TMCH situation, or the Board with the IOC/RC and IGO protections, can be bothered to wait.
So they’ve waded in, making what look very much like top-down decisions, and defending them with a soupcon of hypocrisy by saying it’s for the common good. Yet on the very day the GNSO Chair was writing to the Board to provide an update on the GNSO’s IOC/RC/IGO related work, the Board’s new gTLD committee was passing resolutions side-stepping that work.
The next day, on November 27, 2012, new gTLD committee Chair Cherine Chalaby wrote:

The Committee’s 26 November 2012 resolution is consistent with its 13 September 2012 resolution and approves temporary restrictions in the first round of new gTLDs for registration of RCRC and IOC names at the second level which will be in place until such a time as a policy is adopted that may required further action on the part of the Board.

Continuing on the same line, Chalaby added:

The second resolution provides for interim protection of names which qualify for .int registration and, for IGOs which request such special protection from ICANN by 28 February 2013. (…) The Committee adopted both resolutions at this time in deference to geopolitical concerns and specific GAC advice, to reassure the impacted stakeholders in the community, acknowledge and encourage the continuing work of the GNSO Council, and take an action consistent with its 13 September 2012 resolution.

A soothing “sleep on” message to both the community and the GNSO that the bottom-up policy development process is safe and sound, as long as no-one minds ICANN leadership cutting across it and making the crucial decisions.
Red alert!
Chehadé’s drive to get personally involved and help solve issues is paved with good intentions. In the real world, i.e. the one most of us live and work in, a hands-on approach by the boss generally has few downsides. But in the ICANN microverse, it is fraught with danger.
So is the Board deciding that it knows better than its community and cannot afford to wait for them to “get it”?
These latest episodes should have alarm bells ringing on the executive floor of ICANN Towers.
ICANN only works if it is truly about all interested parties getting together and working through due process to reach consensus decisions. Yes, this process is sometimes lengthy and extremely frustrating. But it is what sets ICANN apart from other governance organisations and make it so well suited to the internet’s warp-speed evolution.
Turn your back on it, act like there are valid circumstances which call for this ideology to be pushed aside, and you may as well hand the technical coordination of the internet’s naming and numbering system to the UN. Simple as that.
This is a guest post written by Stéphane Van Gelder, strategy director for NetNames. He has served as chair of the GNSO Council and is currently a member of ICANN’s Nominating Committee.

Verisign’s IDN gTLDs “could increase phishing” say Asian registries

It’s a bad day for Verisign.
As the company pins its growth hopes partially on its applications for IDN gTLDs — in the wake of losing its price-raising powers over .com — ccTLD registries from Asia-Pacific have raised serious concerns about its bids.
The Asia Pacific Top Level Domain Association says that many of its members reckon the proposed IDN transliterations of .com “could give rise to an increased risk of phishing and other malicious abuses”.
Verisign has applied for a dozen transliterations of .com and .net in scripts such as Hebrew, Cyrillic and Arabic. The strings themselves are meaningless, but they sound like “com” and “net”.
It’s for this reason that APTLD reckons they could cause problems. In an October 1 letter to ICANN, published today, the organization said:

In addition to the potential for user confusion, some [Working Group] members also noted that the creation of transliterated TLDs, without the development of adequate registration and eligibility polices and procedures, could give rise to an increased risk of phishing and other malicious abuses of the new spaces.
…
The WG notes that this potential problem manifests itself at the second level, and is not unique to tranlisterated TLDs, but would argue that the very nature of these TLDs, and their close similarity to existing TLDs, makes them particularly high-risk targets.

The letter does not single out Verisign, and does not represent a consensus APTLD view.
There are also worries among APTLD members about the application for .thai in Latin script, which could clash with Thailand’s IDN ccTLD, and various translations of “.site”.
APTLD notes that the new gTLD evaluation process only contains checks for visual similarity between TLDs.
The only way to block an application based on phonetic confusion is to file a String Confusion Objection, but the only entity eligible to object to Verisign’s applications is Verisign itself.

ICANN massively expands the reserved domains list for new gTLDs

ICANN’s board of directors has given the Olympic and Red Cross brands – along with those of a batch of intergovernmental organizations — special second-level protection in new gTLDs.
Its new gTLD program committee this week passed two resolutions, one protecting the International Olympic Committee and Red Cross/Red Crescent, the other protecting IGOs that qualify for .int domain names.
New gTLD registries launching next year and beyond will now be obliged to block a list of names and acronyms several hundred names longer than previously expected.
Domain names including who.tld and reg.tld will be out of bounds for the foreseeable future.
In a letter to the GNSO, committee chair Cherine Chalaby said:

The Committee adopted both resolutions at this time in deference to geopolitical concerns and specific GAC advice, to reassure the impacted stakeholders in the community, acknowledge and encourage the continuing work of the GNSO Council, and take an action consistent with its 13 September 2012 resolution.

The first ICANN resolution preempts an expected GNSO Council resolution on the Olympics and Red Cross — which got borked earlier this month — while the second is based on Governmental Advisory Committee advice coming out of the Toronto meeting in October.
The resolutions were not expected until January, after the GNSO Council had come to an agreement, but I’m guessing the World Conference on International Telecommunications, taking place in Dubai next week, lit a fire under ICANN’s collective bottoms.
The full text of the resolutions will not be published until tomorrow, but the affected organizations have already been given the heads-up, judging by the quotes in an ICANN press release today.
The press release also noted that the protections are being brought in before the usual policy-making has taken place because it would be too hard to introduce them at a later date:

In approving the resolutions, the New gTLD Program Committee made it clear it was taking a conservative approach, noting that restrictions on second-level registration can be lifted at a later time depending on the scope of the GNSO policy recommendations approved by the Board.

The new Reserved Names List will presumably be added to the Applicant Guidebook at some point in the not too distant future.
Meanwhile, Wikipedia has a list of organizations with .int domain names, which may prove a useful, though non-comprehensive, guide to some of the strings on the forthcoming list.

Europe rejects ICANN’s authority as it warns of problems with 58 new gTLDs

The European Commission has issued a list of 58 new gTLD applications it considers problematic, thumbing its nose at ICANN’s procedures for handling government objections to new gTLDs.
The list, sent to all applicants this afternoon, draws in several applications that were not already subject to Early Warnings from other GAC nations, including .sex, .sexy and .free.
Remarkably, the cover letter says that the gTLDs are not “Early Warnings” as described by the ICANN Applicant Guidebook and says the Commission may continue to work outside the established process in future:

The position outlined in this letter is without prejudice to any further action that the Commission might decide to undertake in order to safeguard the rights and interests of the European Union and of its citizens.
For the sake of clarity, the Commission does not consider itself legally bound to the processes, including the means of recourse, outlined in the new gTLD Applicant Guidebook and/or adopted by ICANN, unless a legal agreement between the latter and the Commission exists.

While that’s little more than a statement of fact — governments are of course free to do whatever they want in their own jurisdictions — it’s giving applicants much more reason to be nervous.
Even if they don’t receive GAC Advice against their applications, the EC may decide to take other action against them.
The fact that the letter also explicitly states that the warnings are definitely not official Early Warnings — meaning applicants on the list won’t even qualify for the extra refund if they drop out — sends a worrying signal that the EC is not in the mood to play by ICANN’s rules.
As for the list itself, the Commission’s letter states that it’s “non-exhaustive” and that it focuses on bids that “could possibly raise issues of compatibility with the existing legislations (the acquis) and/or with policy positions and objectives of the European Union”.
The fact that the list contains ICM Registry’s .adult and .sex applications, but not its identical .porn bid, seems to confirm that the list does not cover all the gTLDs the Commission has a problem with.
The letter (pdf) states that the Commission will attempt to enter into “further discussions” with the applicants on the list (pdf).

Trademark Clearinghouse fees to be capped at $150

Submitting your trademarks to ICANN’s forthcoming Trademark Clearinghouse will cost a maximum of $150 per mark, according to ICANN CEO Fadi Chehade.
In a new blog post, Chehade provides an update to its contract talks with IBM, which will provide the Clearinghouse back-end, and Deloitte, which will be the first submission agent.
It’s shaping up to mimic the registry-registrar model, mapped to the trademark world, and Chehade has confirmed that Deloitte will most likely have competition at the ‘registrar’ level:

Deloitte’s validation services are to be non-exclusive. ICANN may add additional validators after a threshold of minimum stability is met.

The fee for Deloitte to validate trademarks for inclusion in the Clearinghouse will be capped at $150, Chehade said, with discounts for multiple trademarks and multi-year registrations.
IBM will charge Deloitte and gTLD registries for database access on a per-API-call basis, but prices there have not yet been disclosed.
Chehade also provided an update on the so-called “straw man” solution to the trademark community’s unhappiness with the current strength of new gTLD rights protection mechanisms.
For the most part, the update is merely a procedural defense of the changes that ICANN wants to make to the Sunrise and Trademark Claims processes, such as the creation of a “Claims 2” service.
The argument is, essentially: “This isn’t policy, it’s implementation.”
ICANN “policies” have to go through community processes before becoming law, whereas “implementation” is somewhat more flexible. Things are often classified as implementation when there are pressing deadlines.
The one change identified by Chehade as possibly needing community work is the extension of Trademark Claims from trademarks only to trademark+keyword or typo registrations.
He said he plans to publish the full straw man model, which has been developed behind closed doors with selected members of the GNSO, later this week.

Melbourne IT may sell off businesses as ICANN delays hit bottom line

Melbourne IT is looking into selling some of its business units after warning the Australian markets today that 2012 profit is likely to come in below 2011 levels.
The brand protection registrar, listed on the Australian Stock Exchange, partly blamed delays to ICANN’s new gTLD program for an expected 10% dip in earnings before interest and tax.
The company said it is “in the process of pursuing possible ownership alternatives for its current portfolio of businesses”, and that overseas buyers have already been identified.
While Melbourne did not specify which units face the chop, my hunch is that it’s not talking about its domain name business.
Digital Brand Management services, which includes its registrar, is performing “strongly” despite the delays, the company said.
However, its small business, enterprise and legal content management businesses are suffering from competition and spending freezes among government clients, the company said.
Even the registrar business is facing challenges. In the first half of 2012, its total domains under management dropped 8%. The brand management side of that business is now bigger.

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.

GAC Early Warnings confirmed for today. Here’s what I expect to see

ICANN’s Governmental Advisory Committee is ready to send out its Early Warnings on new gTLD applications today as scheduled, ICANN has confirmed.
The Early Warnings, which highlight applications that individual GAC members have problems with, are expected to be sent by the GAC to applicants and published by ICANN later.
Because the warnings are expected to be issued by individual governments, rather than the GAC as a whole, we could wind up seeing hundreds, due to multiple governments objecting to the same applications.
However, some governments may have decided to be conservative for precisely the same reason.
Governments won’t be able to hide behind the cloak of “GAC Advice”, as they did when .xxx was up for approval last year; the names of the governments will be on the warnings.
That’s not to say there won’t necessarily be safety in numbers. It’s possible that some warnings will be explicitly supported by multiple governments, potentially complicating applicant responses.
But which countries will provide warnings?
I’d be surprised if the US, as arguably the most vocal GAC player, does not issue some. Likewise, the regulation-happy European Commission could be a key objector.
It’s also my understanding that Australia has a raft of concerns about various applications, and has been leading much of the back-room discussion among GAC members.
Going out on a limb slightly, I’m expecting to see the warnings from Western nations concentrating largely on regulated industries, IP protection and defensive registrations.
We’re likely to see warnings about .bank and .sucks, for examples, from these governments. To a certain extent, any non-Community applications that could be seen as representing an industry could be at risk.
On the “morality” front, indications from ICANN’s public comment period are that Saudi Arabia has a great many problems with strings that represent religious concepts, and with strings that appear to endorse behavior inconsistent with Islamic law, such as alcohol and gambling.
But last time I checked Saudi Arabia was not a member of the GAC. It remains to be seen whether similar concerns will be raised by other governments that are members.
The one Early Warning we can guarantee to emerge is against .patagonia, the application from a US clothing retailer that shares its name with a region of South America.
The Argentinian government has explicitly said it will issue a warning against this bid, and I expect it to garner significant support from other GAC members.
The GAC Early Warnings stand to cause significant headaches for applicants, many of which are gearing up for a four-day US Thanksgiving weekend.
After receiving a warning, applicants have just 21 days to decide whether to withdraw their bid — receiving an 80% refund of their $185,000 application fee — or risk a formal GAC Advice objection next year.
But that’s not even half of the problem.
The GAC has indicated that it wants to be able to, effectively, negotiate with new gTLD applicants over the details of their applications after issuing its warnings.
At the Toronto meeting last month, the GAC asked ICANN to explain:

the extent to which applicants will be able to modify their applications as a result of early warnings.
[and]
how ICANN will ensure that any commitments made by applicants, in their applications or as a result of any subsequent changes, will be overseen and enforced by ICANN.

ICANN has not yet responded to these inquiries and it does not expect to do so until Thursday.
The fact is that ICANN has for a long time said that it does not intend to allow any applicant to make any material changes to their applications after submission. This was to avoid gaming.
It has since relaxed that view somewhat, by introducing a change request mechanism that has so far processed about 30 changes, some of which (such as .dotafrica and .banque) were highly material.
Whether ICANN will extend this process to allow applicants to significantly alter their applications in order to calm the fears of governments remains to be seen.
Whatever happens this even, many new gTLD applicants are entering unknown territory.

Straw man proposed to settle trademark deadlock at secretive ICANN meeting

Trademark interests seem to have scored significant concessions in their ongoing battle for stronger rights protection mechanisms in new gTLDs, following a second closed-doors ICANN meeting.
Following a two-day discussion of the Trademark Clearinghouse in Los Angeles late last week, ICANN CEO Fadi Chehade has published a “straw man” proposal for further discussions.
The straw man — if it is ultimately adopted — would grant the Intellectual Property Constituency and Business Constituency some of the things they recently asked for.
Crucially, they’d get the right to add keywords to the trademarks they list in the Trademark Clearinghouse, making them eligible for the Trademark Claims service.
There would be a test — a UDRP or court win concerning the string in question — for inclusion, and a limit of 50 brand+keywords or misspellings per trademark in the Clearinghouse.
The idea here is to help brand owners quickly respond to the registration of — but not preemptively block — domains such as “brand-industry.tld” or “brand-password-reset.tld”.
The Trademark Claims service would be extended from 60 to 90 days, under the straw man model.
Chehade’s blog post also outlines a “Claims 2” process that would run for six to 12 months after the launch of each new gTLD and would require trademark owners to pay an additional fee.
This Claims 2 service would not necessarily give registrants the same information about trademarks related to the domains they want to registry. Why not is anyone’s guess.
Here’s how Chehade described it:

Rights holders will have the option to pay an additional fee for inclusion of a Clearinghouse record in a “Claims 2″ service where, for an additional 6-12 months, anyone attempting to register a domain name matching the record would be shown a Claims notice indicating that the name matches a record in the Clearinghouse (but not necessarily displaying the actual Claims data). This notice will also provide a description of the rights and responsibilities of the registrant and will incorporate a form of educational add-on to help propagate information on the role of trademarks and develop more informed consumers in the registration process.

I’ve long been of the opinion that Trademark Claims service will not prevent most cybersquatting (determined bad actors will click through the notices as easily as you or I click through a software license agreement) and “Claims 2” appears to be a diluted version of the same lip service.
Claims 2 and the extension of the Clearinghouse to brand+keyword strings appears to be a step in the right direction for trademark owners, but I can’t see the changes substantially reducing their costs.
There’s also already opposition to the ideas from the Non-Commercial Stakeholders Group, according to this analysis of the straw man from NCSG chair Robin Gross.
The LA meeting rejected the notion of a preemptive cross-TLD trademark block list along the lines of the ICM Registry’s Sunrise B for .xxx, which is among the IPC/BC proposals.
The only change to Sunrise proposed in the straw man model is a mandatory 30-day notice period before the mandatory 30-day Sunrise kicks off, to give brand owners time to prepare.
In summary, the straw man proposal appears to create some marginal benefit for trademark owners at the expense of some additional cost and complexity for registries and registrars.
It would also create an entirely new rights protection mechanism — Claims 2 — out of whole cloth.
While no firm decisions appear to have been made in LA, it’s impossible for us to know for sure what went down because the meeting was held behind closed doors.
ICANN even enforced a Twitter ban, according to some attendees.
The meeting was the second private, invitation-only TMCH discussion in recent weeks.
While we understand there were remote participation opportunities for invited guests unable to attend in person, there was no opportunity to passively listen in to the call.
DI was told by ICANN there was no way for us to follow the talks remotely.
According to a number of attendees on Twitter, participants were also asked by ICANN not to tweet about the substance of the discussions, after complaints from trademark interests present.
The same attendees said that ICANN plans to publish a transcript of the meeting, but this has not yet appeared.
Considering that the issues under discussion will help to shape the structure of the domain name industry for many years to come, the lack of transparency on display is utterly baffling.