Should the UDRP be reformed? Don't go there, says WIPO

The Uniform Dispute Resolution Policy (UDRP) of ICANN, which is binding for all registrars and, by virtue of being incorporated into the domain name registration agreement, on anyone registering a domain name in a generic top level domain (notably .com, .net and .org, the others play a small role), provides since 1999 for a dispute resolution process if a trade mark owner feels that a domain name infringes his rights. Assuming IPKat readers will be roughly familiar with the policy, I shall spare you the details (some background here).

ICANN is cautiously posing the question whether the UDRP should be reformed, and has received a resounding "NO, PLEASE DON'T" from WIPO. The main arguments of WIPO, as summarized in a Webinar held on 10 May 2011, are the following:

• The UDRP has been offering an effective solution for trademark owners, domain name registrants, and registration authorities.
• By accommodating evolving norms and practices, the UDRP has proven to be a flexible and fair dispute resolution system.
• With vast DNS growth around the corner and untested new RPMs in development, the time is wrong to revise the UDRP.
• Institutionally stacked, an ICANN revision process would likely end up overburdening and diluting the UDRP.
• Fundamental questions about the business and DNS beneficiaries of cybersquatting must be addressed before targeting the very mechanism intended to address this practice.

Instead of allowing the UDRP to be placed in the dock, ICANN should first fairly address the following issues:

• the relationship between cybersquatting and the activities, revenues and budgets of DNS actors; the incidence of UDRP cybersquatting findings in relation to wider trademark abuse in the DNS overall, with filed UDRP cases merely representing the tip of the iceberg; and
• the degree of proportionality between trademark rights enforcement and domain name registration opportunities in the DNS.

From the user's side, Aimee Gessner, Senior Trademark Counsel at the BMW Group, adds:

• The real problem is not the UDRP: Other practices since the launch of the UDRP in 1999 have contributed largely in encouraging cybersquatting:
• Domain name tasting
• Increasing domain parking sites / pay per click sites
• Drop-catching
• Use of privacy registration services to hide identities of cybersquatters
• Establishment of bogus “registrars” that have no purpose other than to cybersquat

Summary:
• The UDRP is working fairly and efficiently for its intended purpose
• There are many other causes today for the steady increase in cybersquatting which ICANN should rather review
• Brand owners are concerned at this time with what the expansion of the DNS will cause in terms of cybersquatting and other forms of rights infringement system at such a critical time
• Unwise to review and possibly compromise UDRP system at such a critical time

Attorneys acting for complainants point out that the trade mark owners bear the entire cost of the UDRP system and suggest that a "loser pays" system may be fairer. Respondents warn against further streamlining a system that may cease to be considered fair.

The registrars have some technical issues with the UDRP, notably

• The meaning of “Maintaining the Status Quo” in Section 7 is not clear: No explanation of “Legal Lock” mechanisms and when they go into effect or when they should be removed.
• Policy does not provide guidance on what a registrar is to do if a claim is stayed or suspended: Is the legal lock to be removed or remain in place?
• Policy does not address Privacy and Proxy Registrations or require complaining party to amend complaint once infringing party identified.
• No explanation on what a registrar should do when a UDRP decision conflicts with an injunctive order issued by a of local jurisdiction.

It should be possible to implement these rather technical issues without breaking the system, this Kat thinks. As far as the message of WIPO is concerned, it couldn't be clearer: don't go there (they literally state this in an open letter to ICANN).

Judge applies One in a Million principle against CyberScot

If you've seen this movie, you
probably ARE one in a million

It's not often that the IPKat ventures into the remote and exotic surroundings of the Queens Bench Technology and Construction Court, but he has found this delightful little gem from a judge he never knew existed, Mr Justice Edwards-Stuart. The case is Lifestyle Management Ltd v Frater [2010] EWHC 3258 (TCC) and judgment was given last Friday.  In just a few short paragraphs the judge gave interim relief to two foreign companies in their dispute against a Scottish cybersquatter who was not only using near-identical domain names but was allegedly infringing copyright, passing off and acting in breach of confidence.  Since the defendant was demanding money from the claimants, the judge had the opportunity to apply the Court of Appeal's ruling in One in a Million, in which the notion of an adversely-held website being an "instrument of fraud" was espoused.  Since the judgment was so short, the Kat is reproducing almost all of it here.  It's interesting for the jurisdictional issue too.

"... The Claimants are companies registered in Kenya and the British Virgin Islands, respectively. The Respondent lives in Scotland.

The Claimants carry on business in, I assume, Kenya as financial advisers to expatriates from the United Kingdom working, mainly, in Africa. The Claimants engaged the Respondent as an agent. The terms of that contract are not relevant to this application save for the fact that it contained no jurisdiction clause. That contract has now been terminated. The Respondent claims that he is entitled to commission under the terms of the contract which the Claimants have not paid. The Claimants deny that the Respondent is owed any commission, or at least that he is owed as much as he claims.

... The Claimants have a website with the domain name "offshorelsm.com". According to this evidence the Respondent has registered the domain names "offshorelsm.net", "offshorelsm.org" and "offshorelsm.co.uk". If one goes to these websites there is on at least one of them a home page that bears a very close resemblance to the home page of the Claimants' website. On one, if not both, of the others the Respondent has set out confidential extracts of the Claimants' presentation (or method of presentation) to clients and a photograph of the members of the Claimants' staff. These websites contain material that it is arguably defamatory of the Claimants and which is certainly calculated to damage their business.

The Respondent has made it quite clear that he intends to "cyber squat" using these websites until the Claimants pay the sum that he is currently demanding. The terms of his e-mails to the Claimants make it clear beyond any doubt that his intention is to injure their business and to go on doing so for as long as his demand for payment is not met. One of the websites says this in terms.

Mr Matthew Richardson, who appeared for the Claimants ... submits that the Respondent is using these domain addresses, together with the simulation of the Claimants' home page, to deceive clients of the Claimants, or companies and organisations in England who may refer clients to the Claimants, into going onto one or other of his websites in the belief that they are the Claimants' website and then using the content of those websites to damage the business of the Claimants.

Mr Richardson submits that the Respondent's conduct amounts to the tort of using unlawful means to injure another or is a form of reverse passing off, in the sense that having deceived potential clients to go onto his websites they are then exposed to information that is intended to damage or to undermine the credibility of the Claimants' business.

In my judgment the conduct of the Respondent as disclosed in the evidence before me establishes the threefold requirement of (1) a reputation (or goodwill) required by the Claimants in their domain name"offshorelsm.com", (2) a misrepresentation by the Respondent's use of domain names calculated to lead potential clients of the Claimants into thinking that his three websites are websites of the Claimants and (3) damage to the Claimants ... 

Mr Richardson has also referred me to the case of British Telecommunications plc v One in a Million Ltd [1999] 1 WLR 903, a case which the defendants registered the claimants' company names as domain names as part of a scam to gain money from the legitimate owners. Aldous LJ said, at 920:

"In my view there can be discerned from the cases a jurisdiction to grant injunctive relief where a defendant is equipped with or is intending to equip another with an instrument of fraud. Whether any name is an instrument of fraud will depend upon all the circumstances. A name which will, by reason of its similarity to the name of another, inherently lead to passing off is such an instrument. If it would not inherently lead to passing off, it does not follow that it is not an instrument of fraud. The court should consider the similarity of the names, the intention of the defendant, the type of trade and all the surrounding circumstances. If it be the intention of the defendant to appropriate the goodwill of another or enable others to do so, I can see no reason why the court should not infer that it will happen, even if there is a possibility that such an appropriation would not take place. If, taking all the circumstances into account the court should conclude that the name was produced to enable passing off, is adapted to be used for passing off and, if used, is likely to be fraudulently used, an injunction will be appropriate.

It follows that a court will intervene by way of injunction in passing off cases in three types of case. First, where there is passing off established or it is threatened. Second, where the defendant is a joint tortfeasor with another in passing off either actual or threatened. Third, where the defendant has equipped himself with or intends to equip another with an instrument of fraud. This third type is probably a mere quia timet action."

Whilst the facts of this case are not the same as those in One in a Million, it seems to me that the essential ingredients of a deceptive use of a company name with an acquired goodwill in order to damage the owner of that name are present here.

The problem that troubled me when this application first came before me last week was whether or not I had jurisdiction to entertain the application. As I have mentioned, the Respondent lives in Scotland. Schedule 4 to the Civil Jurisdiction and Judgements Act 1982 provides that persons domiciled in a part of the United Kingdom shall be sued in the courts of that part unless the case comes within rules 3 to 13 of the Schedule.

Mr Richardson relies on rule 3(c). This provides that a person domiciled in part of the United Kingdom may, in another part of the United Kingdom, be sued . . . in matters relating to tort "in the courts for the place where the harmful event occurred or may occur".

Mr Richardson submits, and I accept, that in the circumstances that I have already described potential clients of the Claimants, or companies or organisations who employ such clients and with whom I am told the Claimants enjoy a relationship, may go on to one of the Respondent's websites in the mistaken belief that it is the website of the Claimants - thereby being deceived - and will then be put off by what they find there. This, he submits, is a harmful event within the meaning of rule 3(c) of Schedule 4 of the 1982 Act with the result that the claimants can sue the Respondent in the courts of England and Wales.

I have been persuaded on the evidence before me that this submission is a good one. The evidence indicates also that the Respondent is in possession of the Claimants' confidential database of their clients.

Accordingly, I am satisfied that this Court has jurisdiction to entertain the application and that interim relief should be granted, against the usual undertakings, in the form that I have set out above.

I am not prepared to make the order requiring the Respondent to relinquish his interest in the three websites that I have identified, or to transfer the domain names to the Claimants, without giving the Respondent an opportunity to be heard. I have therefore adjourned that part of the application to the return date".

The IPKat looks forward to the next instalment.

Narnia domain name dispute concludes

The IPKat previously reported (here) the plight of a Scottish couple who had registered the domain name narnia.mobi, claiming that they had done this as a birthday present for their son. The proprietors of the various copyright works of the late CS Lewis, and the associated trade marks, were not impressed by this and began proceedings at the WIPO-run domain name dispute resolution service (link). The decision has now issued, and is available here.

The facts of the case, as summarised in the decision, immediately lead one to suspect that the motives of the respondents were not quite as they had alleged:

"The Complainant owns trademark, copyright and other proprietary rights in the literary works of C.S. Lewis. This includes valid and subsisting trademark registrations in various countries for the term “narnia” and other NARNIA-composite marks. “Narnia” is the name of a fictional country in C.S. Lewis’ “The Chronicles of Narnia”, a series of seven children’s books. The first book in this series was published in 1950, and the works since have been adapted for film at least twice - in the film “The Chronicles of Narnia: The Lion, The Witch and The Wardrobe,” and more recently in the film “The Chronicles of Narnia: Prince Caspian”. The Complainant also owns and operates web sites at narnia.com and narnia.co.uk, which provide information about the “The Chronicles of Narnia” books and the movies, their history and characters.

The Respondent, together with his wife, runs the Saville-Ferguson media and PR agency. The Respondent registered the disputed domain name narnia.mobi on September 29, 2006, shortly after the dotMobi sunrise period for trademark owners had closed. The disputed domain name resolves to a parked web page provided by Sedo, containing “sponsored links” to commercial websites, including links to websites offering for sale merchandize and apparel related to “The Chronicles of Narnia” books and movies.

Between September 28 and 30, 2006, the Respondent also registered the following domain names: drwho.mobi, mi5.mobi, mi6.mobi, middleearth.mobi, spooks.mobi, tardis.mobi, ovaloffice.mobi, pentagon.mobi, primeminister.mobi, scottishparliament.mobi, thequeen.mobi, and uspresident.mobi. With the exception of middleearth.mobi, all of these domain names resolve to parked websites provided by Sedo.1

On June 17, 2008, two weeks after the filing of the instant Complaint with the Center, the Respondent registered the domain names freenarnia.com and freenarnia.mobi."

After hearing arguments from both sides, the panel was unconvinced by the respondent's claims that they had acted in good faith, and concluded as follows:

"The Panel cannot envision any plausible, good faith basis upon which the Respondent could have concluded that he was free to appropriate the Complainant’s distinctive and widely known NARNIA mark for use as a personal email address. The Respondent was well aware of the Complainant and the Complainant’s mark, and the Respondent clearly had notice that the Policy was applicable to domain name registrations in the dotMobi registry. Equally disturbing to the Panel at this point is the Respondent’s registration of the freenarnia.com and freenarnia.mobi domain names subsequent to the filing of the Complaint in this matter, and the implications these registrations hold both in terms of the good faith requirement implicit in paragraph 2 of the Policy and, ultimately, the Respondent’s motivation in registering not one but three domain names appropriating the Complainant’s mark."

Unsurprisingly, the panel ordered that the domain name narnia.mobi be transferred to the complainant.

The IPKat is not at all surprised by the decision, but is a little dismayed (and, perhaps naively, shocked) by the apparently blatant manipulation by the respondents of their story when it first appeared in the media a few weeks ago. It seems to the IPKat that they knew exactly what they were doing, and their actual motives had very little to do with simply getting a nice birthday present for their son. Instead, their acts of registering so many domain names now makes them appear like classic cybersquatters, but perhaps with a particular talent for tales of fantasy.

WIPO roars over cybersquats -- and here's a new competition

In a press statement issued today, the World Intellectual Property Organization (WIPO) expressed its anxiety about current trends in cybersquatting.

Right: Cybersquatter, by Justin Bua (available here)

The flier for the press release reads, in relevant part:

"Against the background of an unprecedented number of cybersquatting cases in 2007, the evolving nature of the domain name registration system (DNS) is causing growing concern for trademark owners around the world. Last year, a record 2,156 complaints alleging cybersquatting – or the abusive registration of trademarks on the Internet - were filed with the World Intellectual Property Organization’s (WIPO) Arbitration and Mediation Center (Center), representing an 18% increase over 2006 and a 48% increase over 2005 in the number of generic and country code Top Level Domain (gTLDs and ccTLDs) disputes".

The IPKat isn't surprised at the trend: he believes it's far worse than WIPO's statistics suggest, since (i) where cybersquatters use sites actively it becomes realistic to pursue them through the courts and secure damages or an account of profits and (ii) where cybersquatters don't use sites actively, reputable traders have to be quite selective as to which ones they proceed against before WIPO, national equivalents or anyone else because of the huge toll in terms of time, money and effort. Merpel adds, the proliferation of pathetic and nearly meaningless top level domains doesn't help either. Who was it that urged the creation of .biz, .name and .info? It surely wasn't reputable business, was it?

Very long list of serious and not-so-serious top level domains here

The IPKat offers a copy of Elle Todd's excellent Gringras: the Law of the Internet (details here) to the best suggestions for truly silly top level domains. Please send your entries here and be patient if you don't get a swift acknowledgement. Closing date: Friday 4 April.