URS: A Failed Domain Name Dispute Resolution Policy That ICANN Insiders Wish To Impose On More Registrants (Part 2)

In this multi-part series, I look at the Uniform Rapid Suspension (URS) policy, a domain name dispute resolution policy that the RPM PDP working group of ICANN is currently reviewing. In part 1, I gave an overview of the URS, and looked at 6 recent domain dispute decisions to help illustrate why it’s such a failed policy, one that belongs in the trash heap of history.

In this post, I will look at some of the individual proposals for changing the URS that may or may not be published in the Initial Report of the working group.

Currently the working group co-chairs are openly violating the working group rules,  relitigating which URS proposals submitted by individual members (including myself, before I was unfairly banished from participation) should be published in the coming report that is open for public comment. Despite this, those remaining members of the working group have not challenged the proposed agenda, which would exclude proposals from the Initial Report.

I will go through the individual proposals in the same order that the working group is doing, in order to illuminate the issues involved. As there are more than 30 of them, I will cover just 7 of them in this post.

Proposal #2 – by Maxim Alzoba

Proposal #2 is a simple proposal to simply move text from one document to another in the URS implementation documents, and as such is not very controversial. It’s more of a minor implementation issue, rather than anything that impacts underlying policies. While I support making it easier to understand the underlying policies for those who are bound by them (such as registrars and registries), ultimately this minutia should be sorted out in an implementation working group, rather than the policy working group itself.

Bottom Line: I support the proposal itself, but it belongs in a future implementation working group, not this working group.

Proposal #23 – by George Kirikos

Proposal #23 is my proposal that both registrars and registries be permitted to recover their reasonable administrative and compliance costs for the URS. Those costs can include locking a domain name, responding to emails in a timely manner (which means making trained legal and technical staff available to check for those emails, which can be a large overhead cost), changing nameservers, and looking up the true contact information of registrants using WHOIS privacy services. Someone has to pay for those costs, and it should ultimately be those who are generating those costs, namely the URS providers (who themselves are directly compensated for their services by complainants).

Indeed, if this proposal is rejected and the URS is imposed on all gTLDs (including dot-com), Verisign can certainly ask for higher fees from all dot-com registrants, due to the burden of a new consensus policy, as per section 7.3(d)(ii) of the .com Registry Agreement which says that

Registry Operator shall be entitled to increase the Maximum Price during the term of the Agreement due to the imposition of any new Consensus Policy…not to exceed the smaller of the preceding year’s Maximum Price or the highest price charged during the preceding year, multiplied by 1.07.

By not adopting this proposal, Verisign could force all registrants to pay. Given ICANN’s inability or reluctance to scrutinize the actual costs of performing registry service, the URS could even become a profit-center for Verisign, as they could raise fees on all dot-com registrants by far more than the actual compliance costs of the URS. Indeed, strictly observing the above text, they’d be entitled to up to a 7% fee increase, which (using a starting point of $7.85/yr per domain for 143 million domain names) would amount to up to $78 million dollars per year if the URS was imposed as a consensus policy on dot-com.

To understand that this is a real danger, keep in mind that proposal #31 which would turn the URS into a consensus policy applicable to all gTLDs (including dot-com) was put forth by David McAuley, a Verisign employee. Coincidence? I don’t think so. Those who believe it to be just a coincidence probably also believe in the tooth fairy. Those who believe it’s a coincidence probably also think it’s “just a coincidence” that PIR (operator of .org) being sold to private equity happened right after ICANN approved unlimited fee increases. You’ll note too that proposal #31 wasn’t put out by Mr. McAuley in his personal capacity, but he did it “on behalf of Verisign” (see “Rationale” section of the proposal).

Bottom Line: I obviously support this proposal, given it came from me.

Proposal #1 – by Kristine Dorrain

Proposal #1 attempts to address sloppy language in the existing URS policy that attempts to “prohibit” a registrant from changing the content of a website for a domain name in dispute. Ms. Dorrain (formerly of NAF, the main URS provider, but now at Amazon) wants the language wordsmithed a little bit. However, the underlying rationale for the insertion of the language is itself flawed.

Consider an innocent domain name owner who inadvertently has a TM-infringing use on their domain’s website (e.g. a single link on a large website). The current section of the policy suggests that the domain owner shouldn’t be allowed to immediately correct the situation, but should preserve and perpetuate that infringement! The bizarre “logic” is that those who created this failed policy want the panelist examining the arguments in the dispute to see the active trademark infringement “live” (having a screenshot in the complaint isn’t good enough). Those who created this policy don’t want the infringing link taken down by the domain name owner themselves, to mitigate and minimize the damage caused by temporary infringement. Rather, they want the entire domain suspended, even if the domain name is infringing for several more weeks while the cases is pending. This demonstrates the bizarre and punitive nature of those ICANN insiders who proposed this flawed section of the URS policy.

Bottom Line: Wordsmithing the current URS language isn’t going to fix it. The entire policy needs to be abandoned.

Proposal #8 – by George Kirikos

Proposal #8 is a simple proposal from me to give 3 additional days to respond to a dispute for each year that has elapsed in the life of the domain name (since it was created), up to a maximum of 60 days total. Under the current URS, a domain owner has a mere 14 calendar days to respond.

In real court actions, the clock doesn’t start until a claim is served upon the other side, so that they likely have actual notice of the dispute. But, not so with the URS. Under the URS (and the UDRP too), the clock starts ticking immediately when notice is sent (but perhaps not received/viewed), and so one might not even be aware of the dispute (e.g. if on vacation, or if the email notice went to a spam folder, etc.), or have limited time to respond (if one becomes aware of it after some time has elapsed). In real courts, one has much longer than 14 days to respond to disputes (often 30 days or more from the time actual notice is achieved).

My proposal attempts to add balance to the URS, given that disputes over domain names that have been registered for many years can’t be considered “urgent”. A trademark owner under the current policy has no time limit to bring a URS complaint (although I address this in a separate proposal), so we might see URS disputes involving domain names that are 10 or 20 years old in the future, particularly if the URS becomes a consensus policy applicable to dot-com domain names.

Indeed, the truly abusive domain names tend to be registered using promotional pricing (under $1/yr), and don’t survive into the 2nd or later years (when renewal fees are higher), as the “carrying costs” would mount if held for long periods. Treating domains of different ages differently makes perfect sense, given this economic reality.

Those who oppose this proposal (for example, trademark holders who would be bringing complaints) desire a one-sided policy that has an uneven playing field, one that limits the ability of the domain owner to either respond at all (there is already a very high default rate, where the domain owner makes not response) or provides insufficient time to find and consult with a lawyer to submit a high quality defense of their asset.

If URS is going to apply to long-registered domains in legacy gTLDs like dot-com, then it’s important that the one-sided rules that were put in place when few people were watching (because few people cared about new gTLDs when the URS rules were adopted just for new gTLDs) are made more balanced with improvements such as this one.

Bottom Line: I obviously support this proposal, given it came from me.

Proposal #34 – by Zak Muscovitch and George Kirikos

Proposal #34 is a joint proposal that successfully merged two prior individual proposals regarding the language of URS disputes. The current rules of the URS are extremely discriminatory against those who don’t understand English, only requiring that the notice of complaint be in a language that the registrant might understand, but not the complaint itself (which is required to be in English)! Such a biased policy should have never have been adopted in the first place, as it has no place in an international multilingual world.

Indeed, if there was to be a single specific language for complaints involving new gTLDs, it would seem Chinese would be the most appropriate one, given that registrants from China dominate registration volumes. Of course, for a policy that might apply to legacy gTLDs,  a Chinese language requirement would be preposterous, but it illustrates how ICANN policymaking has been hijacked by a group of insiders in the first place, to have selected English above all others for disputes. Trademark lawyers from predominantly English-speaking countries want to make it easier for themselves to file complaints, and simultaneously disadvantage registrants who don’t understand English.

To address this, Zak and I proposed changing the URS language rules to match those of the UDRP, which are far more balanced (requiring that the language match the language of the domain name registration agreement, unless the parties or the panel determine otherwise). Thus, a registrant at a Chinese registrar with a Chinese registration agreement can expect the complaint to be delivered in Chinese.

Bottom Line: I obviously support this proposal, given I proposed it jointly with Zak.

Proposal #35 – by George Kirikos

Proposal #35 is an important proposal to clarify the meaning of “registered in bad faith” in the 3-prong test by replacing it with the phrase “created in bad faith”. Currently, in the third prong of the URS (and UDRP) test, a complainant must show that a domain name was both registered in bad faith and is being used in bad faith. However, the policy currently provides no actual definition of the word “registered” and thus it has been interpreted differently by different panelists. This timing is often crucial, since it is difficult to show that a domain name that pre-dates a trademark could have been registered in bad faith.

Some overreaching complainants (and panelists) in the UDRP (which has a similar 3-prong test) have argued that a renewal of a domain name constitutes a “re-registration”, and thus the renewal date is an appropriate date to use for the purpose of showing bad faith registration. That interpretation has been mostly discredited by panelists, but led to some badly decided disputes in the past, due to the ambiguity of the policy text.

Most panelists these days are interpreting the term “registered” as being the date that the current domain owner became the registrant, using that as the appropriate date for the “registered in bad faith” test. However, as I point out in the details of this proposal, that interpretation is flawed.

The appropriate date for “registered” should be the date the domain name was created. That is the single true registration date of the domain name. A transfer of ownership does not change a domain’s registration date, just as an assignment of a patent, trademark or a copyright doesn’t reset relevant dates for those intangible assets.

Indeed, there is direct court precedent for the creation date as being the only relevant date, regardless of subsequent ownership transfers, namely the GoPets v. Hise case, which found that:

The primary question before us is whether the term “registration” applies only to the initial registration of the domain name, or whether it also applies to a re-registration of a currently registered domain name by a new registrant. We hold that such re-registration is not a “registration” within the meaning of § 1125(d)(1).

When the working group was discussing my proposal, others pointed out competing interpretations or other competing court precedents. However, ultimately what matters is that the URS was supposed to apply to “slam dunk” cases of cybersquatting (and the UDRP was supposed to apply to “clearcut” disputes). A domain dispute where that difference in dates can impact an outcome is no longer a simple and straightforward dispute — it is not suitable for a procedure like the URS or UDRP. If the outcome hinges on such crucial distinctions, because of ownership changes, it should be decided by the real courts with full due process protections (or voluntary arbitrary or voluntary ADR, if both parties agree).

My policy proposal thus returns the URS to the disputes it was intended for, the straightforward “slam dunk” disputes. Those opposing this proposal want to preserve a broken system that allows them to use the URS for all kinds of complex disputes, in order to gain an advantage over domain owners.

Bottom Line: I obviously support this proposal, given it came from me.

Proposal #11 – by Brian Winterfeldt, Christopher Thomas, Colin O’Brien, Griffin Barnett, Jeff Neuman, John McElwaine, Lori Schulman, Pascal Boehner, Paul McGrady and Susan Payne

Proposal #11 by a group largely representing the interests of complainants (trademark holders) seeks to raise fees for those responding to complaints involving multiple domain names, by lowering the threshold from 15 domain names to 3 domain names.

This is a poorly thought out and biased proposal, and should be opposed. Often registrants will legitimately register multiple variations of domain names. For example they might register the same term in dot-com, dot-net and dot-org (or other TLDs). Or, they might register variations of a term in a single TLD (e.g. word+term1.com, word+term2.com, etc.). This proposal would disadvantage those registrants, by forcing them to pay mandatory fees to defend themselves. This creates an additional burden for registrants to overcome (on top of the short response time, language, and other problems with the existing policy).

If you read the full proposal, it’s clear that the proponents see the respondents as “guilty” before the dispute is even decided, claiming:

Cases in which there are 3 or more domain names in dispute should be viewed in the same light as those involving habitual

Wait a second — the case hasn’t even been decided yet, and these proponents are already claiming that they involve “habitual cybersquatters”?

Indeed, one of the proponents of this proposal, lawyer Paul D. McGrady Jr., represented the complainant in a UDRP for Viking.org which was determined to be a reverse domain name hijacking attempt. Perhaps he’s not the best person to be telling the ICANN community what is a “reasonable modification” to domain name dispute policies, given that history.

This proposal is open to strategic gaming and bullying by complainants, too, who could force any registrant to spend money to defend themselves by simply adding 2 additional domain names to the dispute, even if they aren’t related to the trademark!

For example, if a trademark owner only cares about suspending 1 particular domain name, but knows that the domain owner owns several other unrelated domains, the complainant can list 2 of those other domains in the complaint in order to reach the “3 domains” threshold, which forces the domain owner to pay extra fees. The trademark owner couldn’t care less about losing the dispute involving the other 2 domains, but instead hopes to force the domain owner to spend money, to bully the domain owner into submission (either by defaulting and not putting up a defense if they can’t afford to pay, or by forcing a settlement).

Bottom Line: This is a policy aimed at tilting the playing field even more in favour of complainants, and should be opposed. It does nothing to bring balance to a process that is already unbalanced.

In the next part of this multi-part series, I will examine more of the individual URS proposals, to help you understand why this failed policy should be abandoned by the ICANN community. It’s not a policy that can be “fixed”, but rather is one that should be eliminated.