Hate UDRP’s: Say Hello To Something Much Worse, The Uniform Rapid Suspension System (URS): Get Ready To Lose Your Domains
Trademark holders, unhappy with UDRP’s, a system under which they already have over a 85% win rate, formed a group, The Implementation Recommendation Team (IRT), which was given committee status by ICANN’s Intellectual Property Constituency “to give additional protection to trademark holders in the implementation of new gTLDs”.
If you want to see a list of members of the IRT click here.
The 68 page, IRT final report was released late Friday night. The committee which was suppose to propose “solutions” for protecting their existing legal rights wound up being a proposal, lets call it a wish list of new rights for trademark holders that have no basis in physical world trademark law.
For ICANN to adopt this would be for it to take on legislative powers and that would be simply outrageous, and for domainers the largest threat to their holdings.
The most important and problematic of the new proposals, is the Uniform Rapid Suspension System (URS)
What is the Uniform Rapid Suspension System?
Think of it as a UDRP on Steroids.
A cheap, quick take down process for trademark holders to not only file a claim against a domain, but a process which could cause a domain to be taken down and placed offline.
As you know, when a UDRP is filed the domain remains in the control of the domain holder (locked by the registry) until the decision is handed down.
Basically the domain holder can continue to use the domain until the decision is rendered and even after that if it “appeals” the UDRP to federal court.
So what doesn’t the trademarks groups like about a medium through which they have a 85% win rate?
For one the cost of a UDRP from a trademark holders position, costs $4K+ per complaint, between filing fees and attorney fees.
The URS will be cheap, $200 per claim. Each claim can contain multiple domains owned by the same registrant or different registrants if the complainant alleges they are related, up to 100 domains at a time.
The URS complaint will be a simple form, which will take only a few minutes to complete, saving trademark holders attorney fees.
So think about it for a minute.
A process where the cost, instead of being $4K+ to the complainant, goes down to $200, maybe as low as $2 a domain.
At that rate you can expect a lot more URS complaints to be filed than you ever saw under UDRP.
With a choice such as this, what trademark holder would ever file a UDRP?
And there’s the problem.
Trademark holders have basically legislated, by a this report, a new system, which will replace, for all practically purposes, the UDRP.
What happens when a URS is filed?
As soon as a trademark holder files a complaint (again its a short form) the domain will immediately be frozen by your registrar.
Then your registrar will notify you that a complaints been filed.
So to be clear, your domain will be frozen before you even receive notice of the complaint.
The URS will have to notify you of the complaint, after freezing your domain and you will have 14 days to submit an Answer.
They will e-mail you to your address on file.
If you have bad whois info then you will not get the notice.
“”"”Notice first should be provided to the New TLD registry operator within twenty-four (24) hours of the filing of the complaint via e-mail at the address the registry operator provides to ICANN. Upon receipt of the notice, the registry operator should within twenty-four (24) hours freeze the domain name to prevent transfers or other changes to the registration.”"”"
The burden of proof in The URS, seems to shift from the complainant in a UDRP, to you the domain holder:
“”"Each answer must include confirmation of Registrant details and a defense for domain name registration(s) and/or use that contradicts the
Complainant’s evidence that they do not have a legitimate right or interest in the domain name(s) (e.g., known by or authorized to use the name at issue or a claim that the use is noncommercial fair use) and that they registered and used the domain in bad faith as detailed and required in the Form Answer attached as Appendix D. In addition, the Registrant may allege the Complainant filed an Abusive Complaint on the form and
request the Examiner investigate these allegations”"”
If you fail to answer in the 14 days or if your answer is deemed to be defective, your domain will at that point be taken down.
The domain will not resolve and you will not be able to use it. If you get e-mail using that domain, your e-mail will not longer work and senders will get bounced e-mail messages back. If the challenged domain is used as a Name Server, then any domains or hosting going to that challenged domain will not work either.
If you do file an proper answer within 14 days then the complaint and your answer go to an “examiner” who will “consider three basic issues, similar to the
standards for a UDRP decision, but requires a much higher burden of proof. The Examiner shall consider each of the following factors:
1. “Whether the domain name is identical or confusingly similar to a mark in which the Complainant holds a valid trademark registration issued by a jurisdiction that conducts substantive examination of trademark applications prior to registration.
2. “Whether the domain name registrant lacks any right or legitimate interest in the domain name.
3. “Whether the domain name has been registered and used in bad faith.
A list of non-exclusive circumstances that demonstrate bad faith registration and use mirror the list stated in the UDRP, namely:
A. Circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise
transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for
valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name; or
B. You have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct; or
C. You have registered the domain name primarily for the purpose of disrupting the business of a competitor; or
D. By using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your web site or other on-line location, by
creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of your web site or location or of a
product or service on your web site or location.
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 this 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 IRT notes that the standard for decision is not the same as that under the UDRP.
Under the UDRP determinations are made based on a preponderance of the evidence, i.e., is it more likely than not that the required element has been proven. Under the URS the test would be based on clear and convincing evidence that there is no genuine contestable issue. If there is a contestable issue, the matter is not appropriate for decision under the URS and the Complainant should pursue a decision in a different
“”"For example, if the trademark in question is BRANDXYZ for use in connection with computers and the domain name in question is brandxyzz.[gtld] and is used in connection with an abusive pay-per-click site, the site would be frozen. If the domain name is brandxyzcomputers.[gtld] and the record shows that it is a bona fide retailer who legitimately sells BRANDXYZ computers, the URS complaint would be denied.”
Ok so what they are saying that parked pages are immediately going to be in trouble if their is a complaint by a trademark holder.
If you look at the proposed complaint form, they have checkboxes, under “bad faith factors” “Sold for profit” or “Sold for commercial gain.”
Doesn’t every business expects to sell their products for profit or for gain?
Yet the IRT would make, making a profit a sign of bad faith.
Also note that unlike a UDRP you will not get the choice to have a three member panel decide the case. There will be only one “examiner” not of your choosing that will make the decision.
If you researched through all the UDRP decisions I think you would find that in 1 man decisions, trademark holders have a much higher win percentage than with 3 member panels.
“”"Upon entry of a decision in favor of the Complainant, the domain name at issue remains frozen at the registry (meaning it cannot be sold, transferred, or assigned) for the duration of the registration period.
“”"In addition, the domain name will no longer point to the registrar’s website, and will be redirected at the registry to a site hosted by the thirdparty
provider. The third-party provider will post a standard page on the domain name, such as: “This domain name is no longer active as a result of a Rapid Suspension proceeding. For more information, please visit www.[URLofthirdpartyreviewer].com.”
“”"Similarly, the registry will update the Whois record to reflect that the domain name is on hold and unable to be transferred or used for any purpose for the life of the registration (including renewal by the same or related registrant).
Right to appeal:
“”"The losing party may appeal an Examination Decision, relating to any or all of the domain names in the Complaint, in the following manner:
“”If the complaint is denied, the Complainant may initiate a proceeding de novo under the UDRP or in a court of appropriate jurisdiction.
“”"If the complaint is granted, the Registrant may request reconsideration on the original record by a URS ombudsman on the grounds that the decision was
arbitrary and capricious or an abuse of discretion by the Examiner, or may initiate a proceeding de novo in a court of appropriate jurisdiction.
“”"If the Examiner finds that the complaint was abusive, the Complainant may similarly request reconsideration on the original record by a URS ombudsman
on the grounds that the decision was arbitrary and capricious or an abuse of discretion by the Examiner.
“”"A losing registrant may vacate the take down of its site by submitting, within thirty (30) days of the Examiner’s decision to the URS provider with proof that it has initiated an appeal of the Examination Decision with a court of competent jurisdiction – a court located in the country of the registrant or the
registrar, with authority to decide a case of cybersquatting or trademark infringement.”"
Ok so lets summarize, someone can file one of these URS against you for $200 (or multiple domains in the same complaint). You have to prove the complaint is wrong. If you win, the complainant can still file a UDRP against you or file a suit in civil court.
It’s basically a free shot a $200 shot to get your domain deactivated.
If they win it great, if they lose it they still can go against you.
How about abusive complaints, like a reverse hijacking ruling?
“”"If a Complainant has been held to have filed abusive complaints on three occasions, the Complainant will be barred from utilizing the URS for a one-year following the date of the last abusive complaint.”"”
Of course the abusive complainant can still file UDRP or court actions, during that one year period and then get a fresh set of URS, in the following year.
However for a business that only has 1 trademark, there is no possible negative penalty they can face by spending $200 to file a URS.
So the next logical issue is who is a trademark holder for purposes of the URS.
“”"Complainant holds a valid trademark registration issued by a jurisdiction that conducts substantive examination of trademark applications prior to registration.”"”
So this would not just be for US trademarks but would allow trademark holders from many countries around the world to file a URS.
Even though the reports says these new rules including the URS are only for the new gTLD’s, they certain leave room open to apply these rules to all existing extensions saying:
“”"It should be emphasized that the IRT was tasked to propose recommendations for new gTLDs and that the proposals contained herein are not currently intended to apply to other than new gTLDs.”"
However, just like the lifting of the price caps on the new gTLD’s extensions, which existing registries such as .biz have already said should apply to them as if they are approved for the new gTLD’s, we will see trademark groups push to open this procedure up to any existing domain extensions as well.
If approved by ICANN this will represent by far the most serious threat to your domains.
Note that this URS applies to all domains regardless of how long you had them.
A trademark holder can go after domains that you registered or acquired prior to the trademark being in existence.
What can you do?
Join the ICA already.
It’s absolutely pitiful that you can’t come up with that huge $295 annual membership, not much more than the cost of filing one of these URS, to join.
Are you a businessman or just a guy making a buck off domains until something else comes along.
A businessman protects his investments, especially for $295.
The ICA has already filed a complaint with the Ombudsman for ICANN arguing the the IRT is an ICANN Constituent Body that did not comply with the Bylaws requirements for transparency and fair representation.
The ICA also made a representation in front of the IRT two weeks ago laying out its opposition.
The ICA will take the lead in fighting this proposal, as it did with the Snowe Bill.
Second you can comment to ICANN on this proposal.
The comment period is opened until June 29th and you can submit your comments to ICANN by clicking here.
Third, you can voice your opposition to this proposal to those companies that are on this committee that you might do business with.
2 Members of this committee are domain registrars.
Both Network Solutions and Godaddy.com have representative on the committee. Let these companies know what you think of it.
Lastly, you can join the ICA.
Yes I said that already, but unless your going to hire your own lobbyist or representative you can see that trademark holders are spending the money and getting results. The results came last year in the form of the Snowe bill and this year in the form of this proposal.
Simply put, you got the goods and they want what you got.
What are you going to do about it?