Businesses call on regulators to stop .sucks “extortion”

ICANN’s Business Constituency wants US and Canadian regulators to intervene to prevent Vox Populi Registry, which runs .sucks, “extorting” businesses with its high sunrise fees.
The BC wrote to ICANN, the US Federal Trade Commission and the Canadian Office for Consumer Affairs on Friday, saying .sucks has employed “exploitive [sic] pricing and unfair marketing practices”.
The constituency adds its voice to Intellectual Property Constituency, which complained last month, causing ICANN to refer the matter to US and Canadian regulators.
Now, the BC has told the OCA and FTC:

We do not believe that exploitative and unfair business practices are conducive either to promoting end-user confidence in the Internet or to fair competition in the domain name space. On the contrary, the pricing structure adopted by Vox Populi for .sucks domain names is predicated purely on expecting the businesses and brands that drive global growth to pay extortionate fees for no consumer or market benefit.
…
Vox Populi’s tactics exploit businesses that neither want nor need these domain name registrations but feel unfairly pressured to register purely for defensive purposes.

The BC’s letter chooses to focus on saying sunrise names cost “$2,499 and up” (original emphasis). That’s based on the MSRP Vox Pop publishes on its web site.
In reality, Vox Pop is charging a registry fee of $1,999 per year for .sucks sunrise registrations.
Retail registrars can add hundreds of dollars in mark-up fees, but the leading corporate registrars that are selling the most .sucks sunrise names — MarkMonitor, CSC and Com Laude among them — have said that as a matter of principle they are only charging a nominal $20 to $25 processing fee.
It’s not the highest sunrise fee I’ve come across. The Chinese registry behind .top asked for $3,500 during its sunrise.
But the semantics of the .sucks TLD makes brand owners nervous and makes many of them feel that a defensive registration is a must-have.
The BC now write to regulators to “urge the FTC and OCA to expeditiously determine whether these practices constitute unfair trade practices”.
The letter points to US and Canadian regulations covering consumer protection for examples of where Vox Pop’s practices may fall short of the law.
The free speech opportunities afforded by .sucks do not outweigh the harms, the BC says.
It’s also interesting to note that while the BC appears to be running to regulators for assistance, it notes that it still fully supports the ICANN model.
There may be a degree of cognitive dissonance within the BC.
In a separate letter to ICANN, also signed by BC chair Elisa Cooper and sent yesterday, the BC seems to take issue with the fact that ICANN felt the need to report .sucks to regulators in the first place, writing:

We would like to understand the rationale for doing so. ICANN has ample authority, a clear obligation and the resources available to stop rogue practices through its contractual agreements with registries, its Compliance Department, and its broad duty to protect the public interest and the security and stability of the Internet, particularly for issues with global reach. Like all other gTLDs launched under ICANN’s program, .sucks has a global reach. It is not clear why ICANN feels it should seek clarification from these two North American agencies.

It’s worth noting that Vox Pop CEO Berard is a member of the BC via his PR agency, Credible Context. He was Cooper’s immediate predecessor as BC chair, leaving the post last year.
Correction: Thanks to the many readers who pointed out that Berard was actually the BC’s representative to the GNSO, not its chair. Apologies for the error.
The letter tells Global Domains Division president Akram Atallah that “viewed in its entirety, Vox Populi’s pricing scheme is a violation of the Rights Protection Mechanisms (RPMs)” developed for the new gTLD program, alleging it discourages use of the RPMs and encourages cybersquatting.
It claims that if Vox Pop populated its Sunrise Premium list (now known as Market Premium, it seems) with data from the Trademark Clearinghouse it could be in violation of its Registry Agreement with ICANN.
My sense has been that the names on that list were actually culled from zone files. Vox Pop has said it was compiled from lists of names that have previously been defensively registered. Most of the names in the TMCH have not been defensively registered.
The BC asks for ICANN “to take strong action”, but does not specify what, exactly, it wants.
The letter to the OCA and FTC can be read here. The letter to ICANN is here. Both are PDF files.

Has .sucks abandoned its Sunrise Premium program?

Vox Populi Registry has done away with the “Sunrise Premium” part of its .sucks launch strategy, if only in name.
The pricing page of the company’s web site no longer makes any reference to Sunrise Premium, the controversial, trademark-heavy list of .sucks domains that would cost over $2,000 a year to register and renew.
Instead, there are two new categories of names: Registry Premium and Market Premium.
Registry Premium appears to be what it was previously just calling “Premium” — individually priced high-value domains such as divorce.sucks and life.sucks. That’s in tune with standard registry practice.
The new Market Premium category appears to be the replacement for Sunrise Premium. The web site describes it like this:

In General Availability, dotSucks has created a list of domains called Market Premium names. These are names that the market over time have designated as having a high value.

Previously, Vox Pop CEO John Berard told DI and other reporters that the Sunrise Premium list had been compiled from names registered or blocked in previous sunrise periods in other TLDs.
It was characterized as an additional protection against cybersquatting, but intellectual property interests saw it as a shakedown.
It’s not obvious from the updated Vox Pop web site whether Market Premium is a ground-up rethink of the Sunrise Premium concept, or is merely an empty re-branding.
The name “Sunrise Premium” was confusing, given that such domains are not actually available during the formal sunrise period. Also, the name inextricably suggested that it was a list of trademarks.
Market Premium names are priced exactly the same as Sunrise Premium — that is, $1,999 at the registry level, with a suggested retail price of $2,499.
Market Premium names will also not be eligible for the discounted “Block” service but will “likely” be eligible for the Consumer Subsidy program. That’s no change from the policies governing the Sunrise Premium incarnation.
The registry web site now also states that purchasers of the Block service, which carries a $149 registry fee, will be able to unblock their domains if they wish to actively use them, but doing so will convert the domain into a $1,999 Market Premium name.
Defensive blocking could therefore have the eventual effect of stuffing the Market Premium list with trademarks anyway (assuming any trademark holders with blocks wish to activate their .sucks names, which seems unlikely).
I’ve put in a request for clarification about Market Premium with the registry and will provide updates when I get them.
Other updates on the .sucks price list include a removal of the $9.95 suggested retail price for Consumer Subsidy names.
Consumer Subsidy names are supposedly going to be run by a third party consumer advocacy group from Everything.sucks, but that group has not been identified by Vox Pop yet.
The fact that the registry seemingly had no deal in place but already knew the price suggested to many that Everything.sucks would just be another shell company managed by Vox Pop owner Momentous. Berard reportedly denied this publicly at the INTA 2015 conference last week.
The Vox Pop web site now states “dotSucks is hopeful that this will bring the individual consumer price below 10 dollars.”

Dot-brand gTLD guilty of domain name hijacking

Fashion retailer Mango, which owns its own dot-brand gTLD, has been found guilty of Reverse Domain Name Hijacking after allegedly doctoring evidence in a .uk cybersquatting case.
The company, which runs .mango, lost a Nominet Dispute Resolution Service complaint against New Zealand-based domain investor Garth Piesse over mango.co.uk and mango.uk.
It’s only the sixth RDNH finding in 13 years of DRS history.
Mango tried to buy the domain using a pseudonym and, when Piesse asked for “six figures”, filed the DRS instead.
Piesse claimed in what appears to have been a well-argued defense that the person attempting to buy the domain on Mango’s behalf did not identify Mango as the would-be buyer.
Further, he claimed that Mango deliberately tried to hide this fact from the DRS panel by scrubbing its negotiator’s email address from evidence it submitted.
While DRS panelist Tim Brown did not agree that this omission alone was enough to find RNDH, he agreed that Mango did not have “entirely clean hands”. He ruled:

The sequence of events in the present case appears to show that the Complainant attempted to buy from the Respondent. When these negotiations failed the Complainant started proceedings under the DRS. As I have noted, the Complainant has relied on bare assertion and has provided a paucity of evidence to support its arguments.
Even a cursory reading of the Policy, Procedure and extensive guidance on Nominet’s website would quickly show that a matter concerning a clearly generic, dictionary term would require a higher standard of argument and evidence than is perhaps common. That the Complainant has failed to come anywhere close to providing sufficient argument or evidence is, in my view, strongly indicative that the Complainant pursued this dispute in frustration at the Respondent’s unwillingness to sell for a price it was willing to pay, rather than because of the merits of its position in terms of the Policy’s requirements.
I conclude that the Complainant brought a speculative complaint in bad faith in an attempt to deprive the Respondent of the Domain Names. I therefore determine that the Complainant has engaged in Reverse Domain Name Hijacking.

Spain-based Mango has owned its trademarks for well over a decade, and Piesse only got his hands on the domains in question in 2013 and 2014.
Piesse, who owns about 18,000 domains, was able to show that Mango the brand is unheard of in New Zealand and that he has a track record of buying fruit-based .uk domain names.

ICANN in “fact-finding” mode over potential .sucks breach

ICANN is playing its cards close to its chest when pressed on what it thinks Vox Populi may have done wrong with its .sucks launch pricing and policies.
The organization told DI in a statement that it is currently “fact-finding”, and will not speculate on what parts of the Registry Agreement may have been breached.
ICANN on Thursday reported Vox Pop to the US and Canadian trade regulators, asking them to judge whether the registry’s $2,000 sunrise fee broke any laws.
Its Intellectual Property Constituency reckons the launch, which also places thousands of trademarks on permanent, high-priced “Sunrise Premium” list amounts to nothing more than a “shakedown” of brand owners.
Vox Pop CEO John Berard told DI last week that the referral to the US Federal Trade Commission, despite that fact that the company and its owners are Canadian, amounted to “appeasement” of the IPC.
In response, ICANN told DI in a statement:

The registry is offering domain name registrations to registrants located in jurisdictions around the world. It¹s possible that a registry’s activities could violate the law in the registry’s own jurisdiction; it is also possible that a registry’s activities could violate the law in the jurisdiction of a registrar or registrant where the registry offers domain name registrations. In this case, the IPC letter was signed by an attorney based in New York City, and ICANN thought it appropriate to ask both U.S. and Canadian authorities to consider the IPC allegations.

ICANN seems to be saying on the one hand that registries are beholden to the laws of wherever their registrants are based and on the other hand that the jurisdiction of the IPC’s current president, Greg Shatan, somehow has a bearing on what laws gTLD registries are obliged to obey.
I await correction from more knowledgeable readers, but I don’t think either of those statements is accurate.
If the latter is true, then perhaps the IPC should in future elect its leaders from only the countries with the most trademark-friendly regimes.
In ICANN’s letters to the FTC and IPC, the organization said it was “evaluating other remedies”. From the context, it seems that ICANN is thinking it could initiate some kind of compliance action against .sucks regardless of the what governmental regulators say.
Asked to explain this, ICANN told DI:

We¹re currently doing some fact-finding and analysis to assess whether there has been any breach by the registry of its obligations, and, based on the results of that analysis, we will try to determine what remedies, if any, may be available. Obviously, it will depend on all the facts and circumstances. Beyond that, since we haven¹t finished that evaluation process it would be inappropriate to speculate about possible remedies.

That’s not saying much, but it leaves the door open for ICANN Compliance to do something even if the FTC and Office of Consumer Affairs deem that no laws have been broken.
One possible “breach” that has been floated relates to the differential pricing created by the Sunrise Premium list. However, my take on this is that, under the new gTLD contracts, it’s not massively different to other kinds of premium pricing program.
Differential pricing protections only apply to renewal fees. If the registrant is told at the point of sale that their renewal fees will be high, that enables registries to put different fees on different domains.
There have also been theories put forward about ICANN’s motivation for referring .sucks to regulators.
The idea that ICANN can defer to the FTC and others on legal matter is not entirely new. In cases where registries intend to merge, ICANN is allowed under its contracts to refer the deals to regulators before approving them.
But this is the first time ICANN has referred new gTLD pricing to competition authorities.
Is it a case of ICANN ass-covering?
ICANN is taking unique fees worth up to $1 million extra from Vox Populi and, as I wrote two weeks ago, the optics of this are bad for ICANN, which could look like it is profiteering from .sucks.
ICANN has explained that the extra fees related to entities that were owned by Vox Pop parent Momentous, the Canadian registrar that had many subsidiaries go out of business owing ICANN a tonne of cash.
By punting the IPC’s complaint to regulators, ICANN could deflect criticism that it is not doing enough to protect rights holders and registrants while avoiding having to make a tricky decision itself.
Regardless, the FTC referral and the fact that ICANN is charging Vox Pop special fees sends a strong message that ICANN does not trust the registry one bit.

ICANN reports .sucks to the FTC over “predatory” pricing

ICANN has referred .sucks registry Vox Populi to the US Federal Trade Commission over concerns from intellectual property owners that its pricing is “predatory”.
The organization has asked the FTC and the Canadian Office of Consumer Affairs to determine whether Vox Pop is breaking any laws.
It asks both agencies to “consider assessing and determining whether Vox Populi is violating any laws or regulations enforced by your respective offices”.
If it is determined that laws are being broken, ICANN said it would be able to “enforce remedies” in the .sucks registry agreement.
ICANN goes on to say that it is “evaluating other remedies” in the registry’s contract.
The shock news comes two weeks after the Intellectual Property Constituency of ICANN complained that Vox Pop’s $2,000 sunrise fee is just a “shakedown scheme”.
The IPC said March 27 it was:

formally asking ICANN to halt the rollout of the .SUCKS new gTLD operated by Vox Populi Registry Inc. (“Vox Populi”), so that the community can examine the validity of Vox Populi’s recently announced plans to: (1) to categorize TMCH-registered marks as “premium names,” (2) charge exorbitant sums to brand owners who seek to secure a registration in .SUCKS, and (3) conspire with an (alleged) third party to “subsidize” a complaint site should brand owners fail to cooperate in Vox Populi’s shakedown scheme.

The IPC is also pissed off that there’s a Sunrise Premium fee that applies to the most famous brands, regardless of when they register.
Vox Pop CEO John Berard told DI tonight that the company’s pricing and policies are “well within the rules”, meaning both ICANN’s rules and North American laws.
He asked why ICANN has referred the matter to the FTC, given that Vox Populi is a Canadian company.
He said that a senior ICANN executive had told him it was because many IPC members are US-based. He described this as “appeasement” of the IPC interests.
Greg Shatan, president of the IPC, whose letter sparked ICANN’s outreach to the FTC and OCA, said that the word “justice” is more appropriate than “appeasement”. He told DI tonight:

We’re looking forward to the FTC and OCA taking a look at Vox Populi’s behavior. And there’s lots to look at. The punitive TMCH Sunrise, where a “rights protection mechanism” intended to protect trademark owners has been turned into a scheme to extort $2,500 and up… The eternal Sunrise Premium of the far-from-spotless .SUCKS registry. The mysterious “everybody.sucks” — purportedly a third party, purportedly providing a “subsidy” to registrant — would anyone be surprised if that was a sham?

With reference to the FTC referral, Shatan also told DI tonight:

I don’t think ICANN wants to waste the FTC’s time. It’s far more rational to think that ICANN informed the FTC because Vox Populi’s activities are within the jurisdiction of the FTC. Mr. Berard’s remarks seem to indicate that he believes that Vox Populi operates beyond the reach of US laws.
With a tech contact in Bermuda and an admin contact in the Caymans, that may have been Vox Pop’s intention. Vox Pop may be operating outside US laws, but I doubt they are operating beyond their reach.

Vox Populi is incorporated in Canada, hence ICANN’s outreach to the Canadian regulator. According to its gTLD application, its only 15%+ owner is Momentous, another Canadian company.
But its IANA record lists an address in Bermuda for its technical contact and Uniregistry’s office in Grand Cayman as its administrative address.
There’s been rumors for months that Uniregistry or CEO Frank Schilling helped bankroll Vox Populi’s participation in the .sucks auction, which saw it splash out over $3 million.
ICANN is asking the US and Canadian agencies to respond to its letter with “urgency”, as .sucks is currently in sunrise and is due to go to general availability May 29.
Trademark owners and celebrities are already registering their names in the .sucks sunrise period.
ICANN confirmed in a separate letter today to IPC chair Greg Shatan that Vox Pop has paid ICANN a unique $100,000 start-up fee, and has promised to pay an extra $1 per transaction, due to now-defunct Momentous subsidiaries defaulting on “substantial payments”.
As DI reported last week, ICANN says that the fee is “not related to the nature” of .sucks, but it could give the appearance that ICANN is a beneficiary of the .sucks business model.
This article was published quite quickly after the news broke. It was updated several times on April 9, 2015. It was updated with background material. It was then updated with comments from Vox Pop. It was then updated with comments from the IPC. Later commenters had the benefit of reading earlier versions of this post before they submitted their comments.

“Halt perverted .sucks shakedown now!” demands IPC

Intellectual property interests have asked ICANN to put an immediate stop to the roll-out of the .sucks new gTLD.
A letter to Global Domains Division president Akram Atallah, sent by the Intellectual Property Constituency this evening and seen by DI, calls the registry’s plans, which include an “exorbitant” $2,500 sunrise fee, a “shakedown scheme”.
It’s also emerged that Vox Populi, the .sucks registry, has agreed to pay ICANN up to a million dollars in mysterious fees that apply to no other new gTLD registry.
The IPC letter states.

the Intellectual Property Constituency is formally asking ICANN to halt the rollout of the .SUCKS new gTLD operated by Vox Populi Registry Inc. (“Vox Populi”), so that the community can examine the validity of Vox Populi’s recently announced plans to: (1) to categorize TMCH-registered marks as “premium names,” (2) charge exorbitant sums to brand owners who seek to secure a registration in .SUCKS, and (3) conspire with an (alleged) third party to “subsidize” a complaint site should brand owners fail to cooperate in Vox Populi’s shakedown scheme.

Vox Populi intends to take .sucks to sunrise on Monday, so the IPC wants ICANN to take immediate action.
The high price of registration, the IPC believes, will discourage trademark owners from using the sunrise period to defensively register their marks.
Meanwhile, the registry’s plan to make the domains available for $10 under a “Consumer Advocate Subsidy”, will encourage cybersquatting, the IPC says.

by discouraging trademark owners from using a key RPM, we believe that the registry operator’s actions in establishing this predatory scheme are complicit in, and encourage bad faith registrations by third parties at the second level of the .SUCKS gTLD, and thus drastically increase the likelihood of trademark infringement, all for commercial gain

The letter goes on to say that Vox Populi may be in violation of its registry contract and the Post-Delegation Dispute Resolution Policy, which was created to prevent registries turning a blind eye to mass cybersquatting.
There’s also a vague threat of legal action for contributory trademark infringement.
The IPC has particular beef with the registry’s Sunrise Premium program. This is a list of strings — mostly trademarks — that have been defensively registered in earlier sunrise periods.
Sunrise Premium names will always cost $2,500, even after sunrise, when registered by the trademark owner.
The IPC says:

Vox Populi is targeting and punishing brand owners who have availed themselves of the RPMs or shown that they are susceptible to purchasing defensive registrations… This will have a chilling effect on TMCH registrations and consequently discredit all of the New gTLD Program RPMs in the eyes of brand owners, whose buy-in and adoption of new gTLDs is widely acknowledged to be critical to the success of the new gTLD program.

Finally, and perhaps more disturbingly, the IPC has discovered that the .sucks registry agreement calls for Vox Populi to pay ICANN up to a million dollars in extra fees.
As well as the usual $25,000-a-year fee and $0.25 per-transaction fee, .sucks has already paid ICANN a $100,000 “registry access fee” and has promised to pay a $1 “registry administration fee” per transaction on its first 900,000 domains.
Its contract states:

Registry Operator shall also pay ICANN (i) a one-time fixed registry access fee of US$100,000 as of the Effective Date of this Agreement, and (ii) a registry administration fee of US$1.00 for each of the first 900,000 Transactions. For the avoidance of doubt, the registry administration fee shall not be subject to the limitations of the Transaction Threshold.

This makes ICANN look absolutely terrible.
What the hell is a “registry access fee”? What’s a “registry administration fee”?
One guess would be that it’s ICANN stocking up its legal defense fund, suspecting the kerfuffle .sucks is going to cause.
But by taking the Vox Pop shilling, ICANN has opened itself up to accusations that it’s complicit in the “shakedown”.
If it does not block .sucks (which was probably the most likely outcome even without mysterious fees) the IPC and other .sucks critics will be able to point to the $1 million as a “bribe”.
The behavior is not without precedent, however.
There’s a reason ICM Registry pays ICANN a $2 fee for every .xxx registration, rather than the much lower fees charged to other gTLD registries.
Read the IPC letter here.

Could you survive a .sucks UDRP?

If you register a .sucks domain matching a brand, could you survive a subsequent UDRP complaint? Opinion is mixed.
In my view, how UDRP treats .sucks registrants will be a crucial test of Vox Populi Registry’s business model.
Vox Populi Registry clearly envisages — and is actively encouraging with its policies — genuine critics, commentators and consumer advocates to register .sucks domains that match famous trademarks.
I really like this idea. Power to the people and all that.
But will UDRP panelists agree with me and Vox Pop? Cybersquatting case law under UDRP says, very firmly: “It depends.”
Statistics generally favor mark owners
To date, there have been exactly 100 resolved UDRP complaints against domains that end in “sucks.com”.
Of those, 47 cases ended up with a full transfer of the domain to the trademark owner. Only 30 resulted in a the complaint being denied.
Another 19 cases were withdrawn or terminated; the remainder were split decisions.
So it seems, based on historical “sucks” cases, that the odds favor trademark owners.
But each case is, theoretically at least, judged on its merits. So it does not necessarily hold that most .sucks UDRP complaints will be successful.
What does WIPO say?
The World Intellectual Property Association, which administers most UDRP cases, published a set of guidelines for its panelists.
Some guidelines specifically addresses “sucks” sites, but the advice is not always clear-cut.
There are three elements to UDRP. First, the complainant must show that the domain name in question is identical or confusingly similar to its trademark.
According to WIPO, it’s the “consensus view” of UDRP panelists that adding “sucks” to a trademark at the second level does NOT stop a domain being confusiningly similar. WIPO says:

Generally, a domain name consisting of a trademark and a negative or pejorative term (such as [trademark]sucks.com) would be considered confusingly similar to the complainant’s trademark for the purpose of satisfying the standing requirement under the first element of the UDRP (with the merits of such cases typically falling to be decided under subsequent elements). Panels have recognized that inclusion of a subsidiary word to the dominant feature of a mark at issue typically does not serve to obviate confusion for purposes of the UDRP’s first element threshold requirement, and/or that there may be a particular risk of confusion among Internet users whose first language is not the language of the domain name

Some panels have disagreed with this prevailing view, however.
It remains to be seen whether moving the string “sucks” to the right of the dot would affect the outcome, but it’s established UDRP case law that the dot in a domain can be pretty much ignored when testing for similarity.
The TLD a domain uses can be taken into account if it’s relevant or disregarded if it is not, according to precedent.
The second test under UDRP is whether the registrant of the domain has legitimate rights or interests.
Panelists disagree on this point. WIPO says:

The right to criticize does not necessarily extend to registering and using a domain name that is identical or confusingly similar to the complainant’s trademark. That is especially the case if the respondent is using the trademark alone as the domain name (i.e., [trademark.tld]) as that may be understood by Internet users as impersonating the trademark owner.

That view would seem to apply specifically to the use cases Vox Pop has in mind — the registry wants critics to own [trademark].sucks domains in order to criticize the trademark owner.
In the 2003 case of natwestbanksucks.com, the WIPO panel drew on earlier precedent to find that the registrant had no rights to the domain.

Respondents’ can very well achieve their objective of criticism by adopting a domain name that is not identical or substantially similar to Complainants’ marks. Given the free nature of the media which is the Internet and the chaotic spamming that has become epidemic, it does not appear that one can be at full liberty to use someone else’s trade name or trademark by simply claiming the right to exercise a right to freedom of expression”.

In other words: you may have a right to free speech on the internet, but you do not have the right to exercise it simply by adding “sucks” to a famous trademark.
But other UDRP panelists have disagreed. WIPO says that some panelists have found:

Irrespective of whether the domain name as such connotes criticism, the respondent has a legitimate interest in using the trademark as part of the domain name of a criticism site if such use is fair and noncommercial.

The third element of UDRP is bad faith. Complainants have to show that the registrant is up to something dodgy.
Some panelists have a pretty low threshold for what constitutes bad faith. Merely having the page parked — even if you did not park it yourself — can point to bad faith, especially in “sucks” cases.
WIPO says that “tarnishment” of a trademark — such as posting porn, which is banned under Vox Pop’s AUP anyway — can be bad faith, but legitimate criticism would not usually:

While it would not normally extend to the mere posting of information about a complainant, or to the posting of genuine, non-commercial criticism regarding the trademark holder, it may extend to commercially motivated criticism by (or likely on behalf of) a competitor of such trademark holder.

So, with all that in mind, here are some tips for improving your odds of surviving a .sucks UDRP.
How to beat a .sucks UDRP
Poring over dozens of “sucks.com” decisions, it quickly becomes clear that there are certain things you should definitely do and not do if you want to keep a hold of your brand-match .sucks domain.
Given the volume of precedent, you’ll have a hard time showing that your domain is not identical or confusingly similar to the trademark in question — strike one — but there are ways to show legitimate interests and rebut claims of bad faith.
1. Respond
To show you lack legitimate interests, the complainant only needs to make a face-value argument that you do not. Then the burden of proof to show rights switches to you.
If you don’t respond to the UDRP, the panel will find you lack rights. Panelists rarely try to fight the corner of a registrant who has not responded.
That’s strike two.
2. Don’t allow your domain to be parked
If a domain is parked, UDRP panelists in “sucks.com” cases invariably find that the registrant lacks legitimate interests and has shown bad faith.
Parking is considered a commercial activity, so you won’t be able to argue convincingly that you’re exercising your right to non-commercial free speech if your domain is splashed with links to the trademark owner’s competitors.
This holds true even if the domain was automatically parked by your registrar.
Dozens (hundreds?) of UDRP cases have been lost because Go Daddy parked the newly registered domain automatically, enabling the complainant to show commercial use.
Panelists are usually happy to overlook the lack of direct bad faith action by the registrant in such cases.
Parking will usually lead to strikes two and three.
In the case of .sucks, parking is actually banned by Vox Populi’s acceptable use policies (pdf).
But the registry will only enforce this policy if it receives a complaint. I don’t know if the Registry-Registrar Agreement, which isn’t public, prohibits registrars auto-parking new domains.
3. Develop a site as soon as possible
In some “sucks.com” cases, respondents have argued that they had intended to put up a criticism site, but could not provide evidence to back up the claims.
If you register a .sucks matching a trademark, you’ll want to put up some kind of site ASAP.
In the case of kohlersucks.com, the registrant had merely framed a Better Business Bureau web page, which was found to show non-commercial criticism use.
4. Don’t offer to sell the domain
It should go without saying that offering to sell the domain to the trademark owner shows bad faith; it looks like extortion.
Panelists regularly also find that registrants give up their legitimate rights to a domain as soon as they make it available to buy.
5. Don’t make any money whatsoever
The second you start making money from a domain that matches a trademark, you’re venturing into the territory of commercial use and are much more likely to fail the WIPO test of “genuine, non-commercial criticism”.
6. Be American
Depressingly, you stand a better chance of fighting off a UDRP on free speech grounds if both the case involves US-based parties and a US-based panelist.
Panelists are more likely to draw on the US Constitution’s First Amendment and associated non-UDRP case law when determining rights or legitimate interests, when the registrant is American.
Merely registering with a US-based registrar is not enough to confer First Amendment rights to a registrant living outside of the US, according to UDRP panels.
Even though freedom of speech is a right in most of the world, in the universe of UDRP it seems the rest of us are second-class citizens compared to the yanks.

Here’s why trademark owners will think .sucks sucks

Vox Populi Registry is to launch its .sucks gTLD at the end of the month, and its plans are likely to piss off trademark owners no end.
As previously reported, the company has backpedaled on its idea of pricing its sunrise period names at $25,000 per name per year, but it’s introducing some new concepts that seem almost designed to get hackles up in the IP community.
From March 30 to May 29, any company with a trademark registered in the Trademark Clearinghouse will be able to buy their matching .sucks domains at sunrise for $2,499. That’s also the annual renewal fee.
It’s a tenth of the price previously touted, but still pretty steep even by sunrise standards.
Vox Pop isn’t doing anything particularly unusual with its sunrise, which is governed by policies closely regulated by ICANN.
But its big new idea is its “Sunrise Premium” list, a list of strings dominated by famous trademarks.
Vox Pop CEO John Berard told DI yesterday that the Sunrise Premium list has been compiled from strings registered or blocked in other TLDs’ sunrise periods.
While he declined to characterize it as a list of trademarks, he acknowledged that it will be trademark-heavy.
If your mark is on this list, you will never be able to get a .sucks domain at the regular general availability retail price of $249 a year. It will always be $2,499 a year.
Despite the name, Sunrise Premium names are only available during general availability, which begins June 1.
On the one hand, this mandatory premium pricing for the world’s most well-defended marks appears to have benefits for some trademark owners.
While Sunrise Premium names are not restricted to owners of matching marks, the $2,499 fee applies whether you’re the mark owner, a legitimate third-party registrant, or a cybersquatter.
So the high price looks like a deterrent to cybersquatting, suggesting that Vox Pop is fighting from the IP corner.
But then we discover that Sunrise Premium names will never be eligible for the .sucks “Block” service — similar to .xxx’s Sunrise B, a Block is a non-resolving registry reservation — which is expected to retail at a discounted $199 per year.
Berard said that the registry wants to encourage use.
“If you are on the Sunrise Premium list or want a premium name, those can’t be blocked,” Berard said. “It’s all part and parcel of us trying to put more power in the hands of individuals and to cultivate a commitment on behalf of the commercial world to participate in the dialogue.”
But the fact remains: if you have a track record of defensively registering your trademark, Vox Pop is essentially penalizing you with higher fees.
Feel those hackles rising yet?
Vox Pop’s stated goals are to give companies a way to manage customer feedback and individuals a way to exercise their rights to criticize.
“A company would be smart to register its name because of the value that consumer criticism has in improving customer loyalty, delivering good customer service, understanding new product and service possibilities,” Berard said.
“They’re spending a lot more on marketing and customer service and research. This domain can another plank in that platform,” he said. “On the other hand, we also want to make sure that these names are also accessible to individuals who have something to say.”
Companies on the Sunrise Premium list have an additional thing to worry about: the .sucks Consumer Advocate Subsidy, which will bring the price of a .sucks domain down to $9.95 per year.
The subsidy will only be available to registrants unaffiliated with the trademark-owning company, and they’ll have to direct their domains to a discussion forum platform called Everything.sucks.
Berard said Everything.sucks will be operated by a third party, but could not yet disclose the details.
The subsidy program will be available on regular and Sunrise Premium names, but not Sunrise names. It is not expected to launch until September.
It’s not yet clear how flexible and configurable the service will be.
It seems likely that if somebody wants to write a blog, say, criticizing a certain company, product, service or public figure, they will incur the usual $249 annual reg fee.
It’s not exactly “free” speech.
On the whole, the finalized policies and fees may look like they’re specifically designed to irk the IP lobby, but they do seem to be aligned with Vox Pop’s mission statement.
If you’re of the view that trademark owners should have the sole right to use the string matching their mark as a domain name, you’re likely to be unhappy with what Vox Pop is doing.
If, on the other hand, you’re an advocate of the right of every free person to stick it to The Man, you may view the policies more favorably.
Either way, it could be a money-spinner for Vox Pop.
I’m expecting .sucks to be only the third new gTLD to top 1,000 sunrise registrations (assuming .porn and .adult will be the first).
Assuming the registry’s slice of the $2,499 fee is over $2,000, the company is looking to clear in excess of $2 million in annually recurring sunrise revenue alone.

.porn now the biggest new gTLD sunrise

.porn and .adult have taken the crown of the most-subscribed new gTLD sunrise periods to date.
The two ICM Registry spaces opened up for registrations from users of the Trademark Clearinghouse on March 2.
A little over a week later, the company tells DI that both gTLDs have individually exceeded the previous sunrise record holder.
My understanding is that .london was the new gTLD with the most sunrise registrations, selling just over 800 names to TMCH customers during its combined sunrise/landrush, which ended last July.
ICM revealed in a webinar last week that it expected its new gTLDs to have to biggest sunrise numbers to date.
“Both .porn and .adult will have exceeded that [.london] number comfortably,” ICM president Stuart Lawley confirmed to DI today.
.adult is “almost neck and neck” with .porn, Lawley said.
The numbers are still pretty small compared to ICM’s 2003-round gTLD, .xxx, which had over 80,000 sunrise applications in October 2011.
They’re also pretty small compared to the TMCH’s overall number of registrations, which at the last public disclosure was a little under 35,000.
But ICM has another couple opportunities for trademark owners to defensively register that may work out cheaper.
First, from April 6 to April 30 companies that bought non-resolving “blocked” names in the .xxx Sunrise B will be able to block the same strings in .porn and .adult.
ICM says registrars are offering discounts for five-year blocks.
Then, from May 6 to May 31 the Domain Matching program starts. That’s open to any .xxx registrant, defensive or otherwise, but not to those with .xxx Sunrise B blocks.

Chehade declines to backtrack on domain “hogging” comments

ICANN CEO Fadi Chehade responded yesterday to anger from domain investors over recent comments in which he talked about “hogging” domain names and implied a link to cybersquatting.
But he did not, at least as far as I understood his explanation, backtrack on his original remarks.
Chehade was cheekily asked his current thoughts on domain “hoggers” by blogger David Goldstein during a press conference at the ICANN 52 meeting in Singapore yesterday.
This is the entirety of his reply:

I think the statement I made to a different media outlet about that was conflated to signify I was including in this all those who are in the domain name business. And that’s not true. There are those that do this as a business and do it very well and actually enhance the market and there are those that do it and make the business and the market less attractive and less desirable. So I think any insinuation that that statement engulfs everyone that is in this business is not true. As you know very well I’ve a very big supporter of the industry groups and was one of the people who was frankly very happy when the Domain Name Association was created and I attended their first formation meeting. This is where we stand and we continue to feel good about how this market is evolving and how these players are making this a good market that serves the public interest.

Having listened to it a few times, I wonder whether Chehade deliberately didn’t backtrack on his original remarks, or whether he doesn’t quite understand why they caused offense in the first place.
A couple of weeks back, Chehade was talking to the Huffington Post about new gTLDs during an interview at the World Economic Forum in Davos.
The interviewer asked about “concerns about a land-grab going on” among domain speculators.
It was a bit of a silly question, if you ask me. A speculative land-grab is pretty low down the list of concerns held by critics of the new gTLD program. Regardless, Chehade replied:

The reality is, the more there are names, the less people will actually be hogging names in order to charge a lot for them. Because if somebody took your name on dot X, you can go get another name on dot Y now.

I’d personally agree with that characterization of the program. It’s meant to make finding a good name at a cheap price easier. “Hogging” was probably a poor choice of words, but Chehade was talking off the cuff so I could give him a pass.
But later in the same reply, he used the term “cybersquatting” in such a way as to make it easy to infer he was conflating domain investing with cybersquatting. That’s a loaded term that is usually reserved for trademark infringement, at least when used inside the industry.
Obviously this was guaranteed to get investors’ hackles up.
First up with the hackles was Mike Berkens, who called Chehade out on The Domains, saying he “throws large domain investors under the bus and then backs up the bus and rolls over them again”.
Berkens pointed out, quite reasonably I thought, that ICANN is funded to a great extent by domain investors. He estimates that he alone pays ICANN about $15,000 a year in the fees that are collected at the point of registration and renewal.
By some estimates, which may even be conservative, about a third of new gTLD registrations to date have been made to speculators.
Berkens made the even better point that many of the people who have pumped hundreds of millions of dollars into the new gTLD program — Uniregistry’s Frank Schilling, XYZ.com’s Daniel Negari and multiple Donuts executives, for example — made their fortunes investing in second-level domains.
He concluded:

All and all some pretty ignorant statements in our opinion made by the CEO of ICANN and an insult to those domain investors that are some of the biggest buyer’s of new gTLD’s domain names who have paid ICANN a small fortune over the years allowing them to travel the world, pay millions a year in salary and other benefits.

Phil Corwin Jeremiah Johnston of the Internet Commerce Association followed up a few days ago with an open letter to Chehade which explained the outrage in slightly more formal and lawyerly way, with all the apostrophes in the right places. He wrote:

The ICA objects to your statement as it expresses a disdainful view towards the legitimate activity of domain investing, a hostile view of domain investors who are significant ICANN stakeholders who are deeply affected by its policies, a lack of awareness of the market realities of domains as an asset class, and an unwarranted promotion of new gTLD domains over those at legacy gTLDs.
…
Domain investors are not “hogs” and they most certainly are not deliberate trademark infringers, or “cybersquatters”. It is not clear what you intended by your reference to “cybersquatting”, though it is concerning that you used this pejorative term just after making disparaging remarks about domain investors.

With all these criticisms in mind, let’s go back and parse what Chehade said in Singapore yesterday.
First, he said his remarks had been wrongly “conflated to signify I was including in this all those who are in the domain name business”.
I’m not sure that’s what happened. I’m pretty certain Berkens and his commenters, and then Corwin Johnston, got the hump purely because Chehade dismissed domain investing as “hogging” and then implied a link between investing and trademark infringement.
Who is Chehade talking about when he draws a distinction between those who “enhance the market” and those who “make the business and the market less attractive”?
Is the line drawn between the trademark infringers and the legitimate investors, or its it drawn somewhere else?
Why did Chehade go on to express his support for the DNA, a sell-side trade group funded largely by registries and registrars? Was he drawing the line between regular second-level domainers (hogging) and those that in many cases are essentially just top-level domainers (enhancing)?
Chehade was given the opportunity to backtrack and he didn’t take it.
I’m not a domainer, but if I were I don’t think I’d be particularly satisfied about that.