Canada: A Step Closer – Impact Of New Generic Top-Level Domains On Brand Owner Rights

Several generic top-level domains ("gTLDs") recently completed their Sunrise Periods, taking a step closer to realizing the Internet Corporation for Assigned Names and Numbers' ("ICANN's") gTLD expansion project from the existing 22 gTLDs (e.g. .com, .net, .org, .biz, etc.) to potentially 1,300 new gTLDs (i.e. arbitrary top-level domains).

Brand owners now face an uphill battle in the enforcement of trade-mark rights on the Internet. But what are the mechanisms available?

ICANN Mandated Protections

The Trademark Clearinghouse (" TMCH ")

The TMCH is a global repository of trade-marks established by ICANN that (i) authenticates rights in a trade-mark, (ii) issues a Signed Mark Data file ("SMD") for the brand owner for the trade-mark and (iii) allows new gTLD registrars to verify new domain name registrations against the SMD.

Only the following trade-marks are included in the TMCH:

1) Nationally or regionally registered word marks from all jurisdictions;

2) Any word mark validated through a court of law or other judicial proceeding;

3) Any word mark protected by a statute or treaty that is in effect at the time the mark is submitted for inclusion in the repository (e.g. Official Marks, Geographic Indications, etc.); or

4) Other marks that constitute intellectual property (by arrangement with a registry).

Entry into the TMCH does not mean an automatic right to register a domain name or prevent others from doing so. Multiple parties may have legitimate rights to the same mark and the TMCH allows these rights to co-exist in the repository. The TMCH also provides Dispute Resolution Procedures to resolve the incorrect rejection or acceptance of, and any challenge to the validity of, a trade-mark entered on the TMCH repository.

The "Sunrise Period"

New gTLD registries must have a Sunrise Period of least 30 days when only brand owners with a valid SMD file issued by the TMCH can register domain names in the registry. Currently, most gTLD registries have a 60-day Sunrise Period.

A list of current and upcoming Sunrise Periods is available here. The first complete Sunrise Period ending December 30, 2013 was for new gTLD .الشبكة , (i.e. Arabic for "web"). A further 65 new gTLD registries will have completed their Sunrise Periods by the end of March 2014.

Where multiple brand owners have applied to register the same domain name, there are registry-specific allocation processes (e.g. allocation by auction) and dispute resolution processes that allow challenges to incorrect Sunrise Registrations.

Trademark Claims Service ("TCS")

New gTLD registries must provide a TCS period for at least 90 days following the Sunrise Period during which the registries will issue warnings to parties attempting to register domain names that are near identical to a trade-mark in the TMCH. Brand owners of trade-marks recorded in the TMCH will receive notification of near identical domain name registrations by third parties from the TMCH indefinitely at no additional cost.

Brand owners can then take any appropriate action, including commencing proceedings under the UDRP or URS (see below) mechanisms or filing complaints against the gTLD registries for improper delegation of domain names via ICANN's Post-Delegation Dispute Resolution Procedures.

Uniform Rapid Suspension System ("URS")

Aside from the UDRP, ICANN requires new gTLD registries to provide URS, a supposedly cheaper and faster dispute resolution mechanism allowing brand owners to resolve the clearest cases of trade-mark misuse. The criteria to be met by brand owners under URS is similar to that in the UDRP, although a higher burden of proof is to be met under URS.

A successful URS complaint will only result in the suspension of the domain name for the remainder of the registration and may be extended by one year upon payment of a fee by the complainant. Transfers are not available. If a complaint is unsuccessful, a brand owner may resort to a complaint under the UDRP or a court proceeding, unless it is found to have brought the URS in bad faith. A URS decision can be appealed.

The effectiveness of the URS in addressing trade-mark abuse remains to be seen, particularly since the UDRP mechanism remains available with access to broader remedies.

Special Treatment for .Brand Owners

ICANN has recently proposed special rules for .brand gTLD registries (e.g. .tiffany, .gucci, etc.). For example, any .brand gTLD cannot be re-delegated for a two-year period following the termination of the registry agreement without the registry operator's consent, unless ICANN deems the continued operation of the gTLD to be in the public's interest.

Registry-Specific Protections

Several new gTLD registries, particularly keyword, geographic or community-based registries, offer brand protection beyond those mandated by ICANN. Brand owners will likely have to rely heavily on these mechanisms given the limited value of the ICANN-mandated measures.

Blocking Service

Brand owners can block the registration of domain names containing their trade-marks across all new gTLDs operated by a registry, provided that the brand owner has an SMD from the TMCH with proof of use for its trade-mark. The blocked domain name cannot operate a website, email address or any other type of domain name functionality.

A domain name will not be blocked:

1) if it is registered prior to the trade-mark appearing on the registry's blocking list;

2) if it is registered by a person who also has rights in the trade-mark contained in the domain name supported by a valid SMD file issued by the TMCH;

3) where the trade-mark is comprised of less than three characters; and/or

4) where a variation of the trade-mark appears in the domain name (i.e. typosquatting).

Given that blocking services are ineffective against typosquatting, brand owners would still need to aggressively monitor new gTLD registries for domain names containing variations of their trade-marks and as a result facing increased costs of enforcement.

Blocking services are not cheap either. Most are available for short renewable terms increasing costs to brand owners in the long-run, although such costs may drop once new gTLD registries generate sufficient income from general domain name registrations.

WHOIS Data

ICANN requires all registries to maintain WHOIS information. While new gTLD registries are not guaranteeing accuracy of WHOIS information, they are promising to conduct audits of WHOIS information on their databases and remedy inaccurate information. Some registries have reserved the right to, inter alia, cancel or transfer domain name registrations where WHOIS information is inaccurate or not up-to-date.

Some registries are also planning to limit use of privacy or proxy services that hide the true identity of the registrant in the WHOIS entry.

Other Mechanisms

Some registries are also:

1) offering broader anti-abuse policies and better means of communication for brand owners to report abuse by domain name registrants;

2) maintaining profiles and/or black lists of registrants that repeatedly engage in trade-mark abuse;

3) excluding registrars with history of non-compliance with their abuse policies;

4) providing watch services beyond the Sunrise Period; and/or

5) imposing strict gTLD-specific eligibility requirements to register domain names.

Conclusion

There is a concerted effort on the part of ICANN and new gTLD registries to provide brand owners with some comfort regarding the protection of their trade-mark rights. However, it remains to be seen how effectively brand owners will actually be able to enforce their trade-mark rights against cyber-squatters and competitors.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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