Canada: Trade-Mark Owners Be Vigilant - ICANN To Publish List Of Proposed New gTLDs

Last Updated: April 26 2012
Article by Peter Giddens

Be alert trade-mark owners! The Internet Corporation for Assigned Names and Numbers ("ICANN") will soon publish a list of all of the proposed new generic Top Level Domains ("gTLDs") and the names of the organizations that have applied for them. Trade-mark owners will want to review that list to see if any of the proposed gTLDs would conflict with their existing trade-mark rights, and if so, to file an objection before the deadline.

Since January 2012 ICANN has been accepting applications by companies and organizations who wish to operate their own gTLD registries. For those applications that successfully complete the evaluation process and are approved for delegation, it is expected that the new gTLDs will start to become operational as early as 2013. As a result the number of Top Level Domains will no longer be limited to the current twenty one (including the ubiquitous .com, .net, .org extensions with which we are all very familiar, as well as the newer .xxx intended for the porn industry) but will be greatly expanded to include a variety of previously unseen domains. For example, according to lists maintained by various websites tracking intended gTLD applicants who have publically stated their intentions, it is believed that applications have been filed to establish a number of well-known brands as gTLDs: (for example .unicef, .motorola, .canon, deloitte, .hitachi) as well as a multitude of generic terms (for example .bank, .music. .app, .movie, .radio).

It is expected that more than 1000 applications for new gTLDs will have been filed by the close of the deadline, and the prospect that many of those applications will be for gTLDs that correspond with a trade-mark is a real cause for concern for trade-mark owners, and in particular for those who did not have the necessary resources to apply for and operate their own gTLD registry. Whereas trade-mark laws are subject to national protection, and thus the same trade-mark may be owned by different companies in different jurisdictions, the Internet is international in reach and each gTLD is unique. Multiple parties around the world may own rights to the same trade-mark, each in their respective jurisdiction and in association with particular goods and services, but only one person will control a corresponding gTLD. Company 1 may have a registration for the trade-mark ABC in Australia, while Company 2 has a registration for the trade-mark ABC in Canada. However, if Company 1 applies for the gTLD .abc, Company 2 is likely to have some genuine concerns about the impact that such a TLD would have on its brand and may wish to take steps to object to the application. Therefore, Company 2, like all trade-mark owners, will have a real interest in reviewing the list of proposed new gTLDs as soon as possible after they are revealed by ICANN so that it will have sufficient time to act in the event it wishes to file an objection within the limited objection filing period, currently expected to expire around the end of November 2012.

The target date to reveal the list of proposed new gTLDs had been scheduled for April 30. However, with ICANN having recently extended the application period following the revelation of a technical glitch in the application filing process, the publication date of the proposed gTLDs has been postponed. ICANN will announce the date when the applied-for gTLDs are to be revealed following the announcement of the re-opening of the application process.

Once the list of proposed gTLDs is announced, there is expected to be a two month window for submitting public comments regarding the applications, and a seven month window for interested parties to file formal objections to any of the new gTLD applications.

The public comment period will permit interested persons to make submissions for consideration by the application evaluation panels that will conduct an assessment of the applications on two measures: string review and applicant review. The string review will evaluate whether a proposed new gTLD is confusing with an existing TLD, or with another proposed new gTLD for which an application was filed, and whether it violates a reserved string or impermissible name or otherwise contributes to the instability of the domain name system. The applicant review will evaluate the applicant organization and its abilities (including technical, operational and financial capabilities) to effectively run a gTLD registry.

The formal objection period will permit qualifying persons to object on a limited number of bases, including legal rights objections. This ground will permit trade-mark rights holders to file objections on the basis that the proposed gTLD would infringe their existing trade-mark rights. The objector will bear the burden of proof, and the source of and documentation for the trade-mark rights (which may include either registered or unregistered trade-marks) must be included in the objection. The objection proceeding is adjudicated on the basis of the filed objection and the applicant's response by a neutral panel, consisting of qualified experts. Although panels will have the ability to hold an in-person hearing in extraordinary circumstances, the expectation is that disputes will be resolved without such a hearing. The panel is limited to determining the success or dismissal of the objection. There are no damages or costs awards, however, the prevailing party is entitled to the return of a portion of its advance filing fee.

According to the gTLD Applicant Guidebook, Module 3 (Objection Procedures), s. 3.5.2, in evaluating the merits of a legal rights objection, the panel will determine whether the potential use of the applied-for gTLD by the applicant takes unfair advantage of the distinctive character of the reputation of the objector's registered or unregistered trade-mark, or unjustifiably impairs the distinctive character or the reputation of the objector's trade-mark, or otherwise creates an impermissible likelihood of confusion between the applied-for gTLD and the objector's trade-mark. The panel will consider the following non-exclusive factors where a legal rights objection is based on trade-mark rights:

(1) whether the proposed gTLD identical or similar to the objector's existing trade-mark in appearance, sound or meaning;
(2) whether the objector's acquisition and use of its rights been bona fide;
(3) whether and to what extent there is recognition in the relevant sector of the public of the sign corresponding to the gTLD, as the mark of the objector, of the applicant or of a third party;
(4) the applicant's intent in applying for the gTLD, and whether the applicant had knowledge of (or could not reasonably have been unaware of) the objector's mark, including whether the applicant has engaged in a pattern of conduct whereby it applied for or operates TLDs or registrations in TLDs which are identical or confusingly similar to the marks of others;
(5) whether and to what extent the applicant has used, or made demonstrable preparations to use, the sign corresponding to the gTLD in connection with a bona fide offering of goods and services or a bona fide provision of information in a way that does not interfere with the legitimate exercise by the objector of its trade-mark rights;
(6) whether the applicant has marks or other intellectual property rights in the sign corresponding to the gTLD, and, if so, whether any acquisition of such a right in the sign, and the use of the sign, has been bona fide, and whether the purported or likely use of the gTLD by the applicant is consistent with such acquisition or use;
(7) whether and to what extent has the applicant been commonly known by the sign corresponding to the gTLD, and if so, whether any purported or likely use of the gTLD by the applicant is consistent therewith and bona fide; and
(8) whether the applicant's intended use of the gTLD would create a likelihood of confusion with the objector's mark as to the source, sponsorship, affiliation or endorsement of the gTLD.

All disputes brought pursuant to legal rights objections will be administered by the Arbitration and Mediation Center of the World Intellectual Property Organization, and will be governed by ICANN's New gTLD Dispute Resolution Procedure and WIPO's Rules for New gTLD Dispute Resolution for Existing Legal Rights Objections. Objections (as well as responses filed by gTLD applicants) must be filed electronically in English, and are limited to 5000 words or 20 pages (whichever is less), excluding attachments.

A legal rights objection will be subject to filing fees by both the objector and the gTLD applicant. In the case of a single objection to a single application, the filing fee payable by each of the parties is US$10,000 for a single member panel, including a $2,000 non-refundable administration fee and a $8,000 panel fee which is to be refunded to the prevailing party; where both parties agree to a three member panel, the per party filing fee will be $23,000 (including a $3,000 non-refundable administration fee and a $20,000 panel fee refundable to the prevailing party). Those fees will be subject to adjustment if objections are consolidated.

Once ICANN has completed its application evaluations and approves gTLDs to become operational (the first of which may occur by early 2013), trade-mark owners will have to again be vigilant to ensure that their trade-marks are not abused in relation to the operation of the new registries (e.g., the unauthorized registration, within the new gTLD, of a domain name corresponding to a trade-mark). Several trade-mark protection mechanisms will be in place including a Trademark Clearinghouse (for use in Sunrise registration periods and Trademark Claims services), a Uniform Rapid Suspension system and a Dispute Resolution Procedure, to assist trade-mark owners in protecting their rights. Trade-mark owners should familiarize themselves with these mechanisms in advance of the new gTLD registries becoming operational. In particular, there may be new gTLDs in which defensive domain name registrations will be advisable in order to prevent cybersquatting. As difficult as it is presently for brand owners to police and prevent trade-mark abuses within the currently available top level domains, with the delegation of new gTLDs, once they are approved, the situation will become even more challenging.

The foregoing provides only an overview. Readers are cautioned against making any decisions based on this material alone. Rather, a qualified lawyer should be consulted.

© Copyright 2012 McMillan LLP

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