Tuesday, August 17, 2010

URS Conclusions: Form of Complaint and Standard of Review

Over the last two weeks, I have discussed the URS in connection with the original proposal of the IRT and the most-recent proposal in the DAG volume four. I have posted separately in relation to the form of the complaint, the time line, the standard of review, and the issues of default and appeal. I intend to combine these postings in the form of a white paper to be available to trademark owners or others interested in such issues that may be used as reference related to ICANN’s September Board retreat and the next public meeting in Cartagena, Colombia in December, where we may very well see a final DAG.

Are the issues with the URS outlined above worthy of nearly 3000 words and counting? Arguably not. But the major concerns for trademark owners are in connection with the scale of the implementation of new TLDs, as in potentially hundreds of new strings, each one of which could pose multiple concerns for trademark owners, who are required by law to enforce said rights or risk losing them. These concerns directly conflict with those who simply want new TLDs to move forward to some form of time line. It’s clear to me that those on both sides of this issue have worked hard to find common ground and the URS reflects those efforts on both sides.

While it does not appear that the URS time line, or the process of default and appeal differ significantly in the latest DAG from those proposed by the IRT, the form of the complaint and the standard of review still require amendment. With regard to the form of the complaint, the STI unanimously rejected the use of a standard form with check boxes. But the current 5,000-word limit leaves little reason for trademark owners to use the URS rather than the UDRP, with an equivalent word count and a stronger remedy. If check boxes are a none-starter, for whatever reason, the word count limit needs to be significantly reduced to encourage trademark owners to choose the URS over the UDRP. Since the URS is only intended as a remedy for clear cut cases of trademark abuse, a 1,000 word limit should prove sufficient to prove such a case, and alleviate the internal and/or external costs to trademark owners.

Similarly, the standard of review should be returned to the clear and convincing evidence test as proposed by the IRT. The language added to the IRT does not add anything to the strong test supported by the IRT and, in fact, adds language that does not fit with the stated goals of the URS or the UDRP. Further, the “defense would have been possible” language is so vague as to be meaningless. Domain name registrants should be protected from unscrupulous URS complaint, but the URS is only intended for clear cut cases and the known and understood clear and convincing evidence test properly fits such cases.

That’s it for the URS. If you would like a copy in the form of a white paper, feel free to e-mail me at Ryan@KaatzLaw.com for a PDF copy. The newest posts over the next couple weeks will be related to the Trademark Clearinghouse and both the PDDRP and the RRDRP.

Monday, August 16, 2010

URS and Finality: Default and Appeal

This will be my final substantive post related to the URS, so it is fitting that the issue is finality. I will then post some general conclusions. The IRT report states, “[s]hould a Registrant find their domain name has been taken down after the fourteen (14)-day Answer period has passed and wishes to file a legitimate Answer to the Complainant, The Registrant may file a Default Answer to the third-party dispute provider at any time during the life of the domain name registration.”

In the public comments section of the most-recent DAG, trademark owners and those representative of trademark owners have contended that the URS is uncertain for trademark owners. In fact, the letters from Com Laude and Marques-ECTA both assert that, in the current draft of the DAG, the “[d]efaulting respondent can apply for de novo panel review for up to two years,” as opposed to the original proposal from the IRT, which only allowed for “[r]econsideration by Ombudsman or appeal to relevant court.”

But the IRT proposal for the URS specifically included a provision for the possibility that a Registrant to file a Default Answer subsequent to a finding against the Registrant under the URS, completely outside of the appeal process. Moreover, even if a losing Registrant filed a Default Answer, the time line related to the issuance of decision from the Examiner would begin to run, meaning a decision would likely be rendered within three business days and, at most, 14 business days. Finally, there have been remarkably few appeals of decisions related to abusive domain name registrations throughout the history of the UDRP. Although the DAG contemplates an appeal process, the nature of that process is left to the purview of the dispute resolution providers, ignoring the IRT’s recommendation of an Ombudsman and the STI’s recommendation to provide three-member panels on appeal. It will be interesting to see if the dispute resolution providers who contract with ICANN to provide URS services will include an appeal process and what the process may be.

Friday, August 13, 2010

URS and Standard of Review

In connection with previous posts parsing through the URS, today’s post covers the evolution of the standard of review from the IRT’s proposal to the proposed standard of review in the DAG volume 4. Pursuant to the IRT’s final report, the standard of review for decisions under the URS consists of a single paragraph:

“If the Examiner finds that all of these elements are satisfied by clear and convincing evidence and that there is no genuine contestable issue, then the Examiner shall issue a decision in favor of the Complainant. If the Examiner finds that the test is not met, then the Examiner shall deny the relief requested terminating the URS process without prejudice to the ability of the Complainant to proceed with an action in court or under the UDRP.”

The “Examination Standards and Burden of Proof” contained in volume four of the DAG, on the other hand, is over a page long, single spaced. The DAG includes the language recommended by the IRT, but also adds the page-long “Standard of Review” proposed by the recommendations of the STI, none of which appears to add anything to or extend beyond the simple clear and convincing evidence test proposed by the IRT.

For example, the DAG proposal reads, “For a URS matter to conclude in favor of the Complainant, the Examiner shall render a Determination that there is no genuine issue of material fact. Such Determination may include that: (a) the Complainant has rights to the name; and (b) the Registrant has no rights or legitimate interest in the name. Of course, outside of the use of the permissible “may,” (b) does not add anything to the URS, as that is one of the three elements cobbled from the UDRP to include in the URS. And (a) is irrelevant. Neither the URS nor the UDRP has ever been used to determine whether the Complainant has rights to the disputed domain name. The URS and the UDRP are designed to provide a remedy for trademark holders against the bad faith registration and use of domain names identical or confusingly similar to marks in which the trademark holder has rights. The issue is not and never has been whether a trademark holder has rights to a domain name registered to a third party.

Furthermore, the DAG proposal states, “If the Examiner finds that the Complainant has not met its burden, or that genuine issues of material fact remain in regards to [sic] any of the elements, the Examiner will reject the Complaint under the relief available under the URS. That is, the URS Complaint shall be dismissed if the Examiner finds that: (1) evidence was presented to indicate that the use of the domain name in question is a non-infringing use or fair use of the trademark; or (2) under the circumstances, and no Response was submitted, a defense would have been possible to show that the use of the domain name in question is a non-infringing use or fair use of the trademark.”

Again, I do not see how (1) adds anything to the URS, as the “fair use” language is included in the Registrant Defenses section of the Policy. Moreover, the “a defense would have been possible” language is so vague as to be meaningless. And whatever it means, it does not appear to add significantly to the clear and convincing evidence test initially recommended by the IRT. The language in the DAG was pulled from the recommendations GNSO’s Special Trademark Issues Review Team, who appear to be seeking broader protections for domain name registrants, and domain name registrants should be protected from overreaching URS complaints. It just is not clear how this convoluted language provides stronger protection than the original clear and convincing test proposed by the IRT.

The IRT’s proposal for the URS included a strong standard of review: clear and convincing evidence. The strong test was necessary because the URS is only intended for clear cut cases of trademark abuse. The superfluous language added to that test just causes confusion and should be removed from the final draft of the DAG.

Thursday, August 5, 2010

URS Time Line

Yesterday I posted on the URS and argued that the format of the complaint should be amended to require a standard form or a significantly reduced word-count limit from the current limit of 5,000 words to 1,000 words. Today, I am going to work through the IRT draft of the URS and the most-recently proposed draft from the DAG volume four to see what sort of time line we might see when the URS goes live.

A number of trademark holders and representatives of trademark holders’ interests contended in the Public Comments to the most-recent DAG that the URS, as proposed in the DAG, is no longer rapid, as it was intended to be. Frederick Felman of MarkMonitor wrote, “[a]s it is currently prescribed, and as analyzed by at least one expert dispute resolution service provider, the URS will be roughly equivalent to the UDRP with respect to time required to adjudicate and therefore is not ‘rapid.’” Nick Wood of Cum Laude asserted that the IRT’s proposal could be completed in 21 days and the DAG proposal could take “up to 47 days,” concluding “an eUDRP can take 35 days – 12 days quicker. URS is no longer rapid.” Eric Wilber, Director of WIPO Arbitration and Mediation Center, contended, among many other concerns, that the time lines for the DAG proposal were “significant.”

According to the URS proposed in the IRT’s final draft, the URS provider has one day to forward the complaint to the relevant registry, the registry has one day to freeze the contact details related to the disputed domain name, and one day from the freeze, the registry notifies the registrant and the registrar of the filing of the complaint. The registrant then has 14 days to answer the complaint. Once the registrant submits an answer or the 14-day answer period expires, a decision is rendered by the URS-provider decision maker. All told, the IRT’s proposed process should not exceed 17 days, although the IRT did not delineate the time necessary for the URS provider to administratively review the complaint for compliance with the policy and rules before the URS provider forwards the compliant complaint to the relevant registry. The IRT’s final draft also does not indicate how much time the decision maker should have to review the filings and issue a decision.

According to the URS proposed in volume four of the DAG, the URS provider has three days to review the complaint for any administrative deficiencies and one day to forward the complaint to the registry. Just as with the IRT final draft, the registry is permitted one day to lock the domain name and one day from the locking of the domain name to forward the complaint to the registrant and the registrar. Under the most-recent DAG, the registrant has 20 days to respond to the complaint. Once a response is submitted or the response period concludes, the decision must be rendered by the decision maker within three days. Therefore, the number of days required to prosecute a complaint under the URS pursuant to the proposal of volume four of the DAG is 29 days.

The time line under the DAG is 12 days longer than the IRT’s URS proposal, but the 29 days include three days for the URS provider to review the complaint for administrative compliance prior to forwarding the complaint to the registry. The most-recent DAG proposal also delineates three days for the decision maker to render its decision. It would appear that the URS provider and the decision maker should be permitted time to administratively review the complaint and to review the filings and render a decision, respectively, and nobody appears to be arguing that three days is too long. So, if we add three days for the URS provider to review the initial complaint and three days for the decision maker to review the filings and render a decision to the IRT’s 17-day proposal, the URS should be limited to 23 days. Therefore, the primary difference between the time line of the IRT proposal and the time line of the DAG proposal is the six additional days allowed for the registrant of the domain name to respond to the complaint.

If the URS proposed by the IRT had outlined the number of days for administrative review and the rendering of the decision, the IRT proposal would have submitted a procedure that should take 23 days, or six days fewer than that proposed in the latest version of the DAG, which does not appear particularly significant. The majority of the concerns for trademark holders are not with the URS time line, but with issues related to the appeal process. I will discuss those issues in the upcoming days in a separate post, because those are significant.

Wednesday, August 4, 2010

The URS and the Form of Complaint

A while back I mentioned here that I wanted to post about the dispute resolution policies open for discussion in connection with the introduction of new TLDs. And as I also mentioned below, the comment period for the latest Draft Applicant Guidebook recently came to a close and those comments included many comments related to the various dispute resolution procedures in the fourth version of the DAG. My intent was to write posts about the URS, the Trademark Clearinghouse and both the PDDRP and the RRDRP, but I already have around 1,300 words devoted to the URS and I am only half way through the major issues. So, I plan on breaking this into chunks, starting with the URS. Over the next few days I will be posting about the format of the complaint, the timing inherent to the rules, the standard of review and the procedures for both default and appeal, but first I will discuss the format of the complaint, along with a little background on the URS for color.

The IRT recommended the inclusion of the URS to be a faster and less expensive option than the UDRP for trademark owners. The IRT asserts in its Final Report that “the UDRP has unquestionably been an important and successful mediation tool for trademark owners and domain name registrants alike.” Nevertheless, due to the fact that “brand owners face thousands of infringing websites per year,” those brand owners “spend large amounts of money to build up portfolios of domain names they do not want, simply to prevent fraud on their consumers and misuse of their brands.” The URS contains the same substantive elements of the UDRP, but “the URS is intended to address efficiently and cost-effectively the most clear cut cases of abuse,” and therefore the standard of proof is higher in the URS than the UDRP. Furthermore, the remedies available under the UDRP are either the transfer or the cancellation of the disputed domain name, while the remedy under the URS is only that the domain name is “frozen” for the remainder of the domain name’s registration period, leaving the domain name to resolve to a specific error page.

In light of the stated goal to keep costs associated with the filing of complaints under the URS down, the IRT proposed that the fees should be much lower than those fees associated with the UDRP, and more importantly that the form of complaint should consist of a standard form, complete with check boxes in connection with the various elements of the URS, along with the opportunity to provide a brief explanation with regard to the bad faith element of the policy. The form complaint contains simply the complainant’s contact and trademark registration information, along with the opportunity to insert the disputed domain names in correlation with the relevant trademarks. Check boxes were included in connection with the elements listed under the registrant’s rights to or legitimate interests in the disputed domain name, as well as the four UDRP factors related to bad faith registration and use. And a mandatory comment section is provided in the bad faith registration and use section. As opposed to the form complaint, the DAG proposal in volume four asserts that a complaint “will be simple and as formulaic as possible” and imposes a word-count limit of 5000 words, excluding attachments, which happens to be the same word limit for a UDRP complaint filed with WIPO in accordance with WIPO’s UDRP Supplemental Rules, as well as the word limit under ICANN’s proposed New gTLD Dispute Resolution Procedure, the PDDRP and the RRDRP.

While the reduced fees for the URS speak well for the cost savings for filing complaints, the word limit is of most importance because trademark owners faced with a domain name that infringes its trademark will either need to devote internal resources in the form of in-house counsel to prosecute complaints over domain names or pay legal fees in association with the use of outside counsel, and those fees or opportunity costs are often greater than the filing fees charged by the dispute resolution providers.

Pursuant to the public comment period subsequent to ICANN’s release of the DAG volume 4, a number of trademark owners and organizations representative of trademark owners complained that the latest draft of the URS was no longer as inexpensive as it was designed to be. Nick Wood, Managing Director at Com Laude, questioned the lengthiness of the URS complaint and asked, “who will afford to be a panelist? Will ICANN subsidise URS?” Frederick Felman, Chief Marketing Officer at MarkMonitor, contended that the URS “will not be inexpensive” and posited that “it is likely that the majority of brand holders will be forced to buy a domain name in each gTLD corresponding to their trademarks or will be filing requisite UDRPs as opposed to relying on the equally time consuming and costly URS process.”

Since the original intent of creating the URS was to create a faster and cheaper form of the UDRP, it appears unnecessary for the length of the complaint to be equivalent. Although some have argued that the higher standard of proof in the URS, clear and convincing evidence, rather than the preponderance of the evidence test in the UDRP, will require additional time and resources to prove, I don’t think that argument holds much water since the URS is only intended to provide relief in the “most clear cut cases of abuse.” Moreover, the nature of disputes in connection with the URS will be less complicated than those related to the UDRP, New gTLD DRP, the PDDRP and the RRDRP, and therefore the necessity of 5000 words appears lessened. And finally, in connection with the original intent of the URS to provide relief only in the “most clear-cut cases” of trademark abuse, the form complaint originally proposed by the IRT should be implemented or the word count should be greatly reduced to 1000 words, or approximately the length of this post, which should be more than sufficient to prove the clear cut cases for which the URS was intended to remedy.