If ICANN Creates An Arbitration System, It Could Not Be Limited To Just Domain Name Disputes

In a blog post last week, I sounded the alarm about a dangerous proposal from an ICANN working group which would have severe negative consequences for domain name owners, allowing IGOs (intergovernmental organizations like the United Nations) to engage in consequence-free reverse domain name hijacking.

After additional research and contemplation, it’s actually even worse than I imagined, and not just for domain name owners. It could create a system whereby an ICANN-developed arbitration system would handle employment disputes, trademark cancellation disputes, environmental disputes, sexual misconduct disputes, defamation actions, whistle-blower retaliation cases, copyright cases, and any other potential court actions, as long as an element of  the overall dispute related to domain names and alleged cybersquatting

There’s been an implicit assumption by members of the current working group (of which I’m not a member, but I’ve read all the transcripts of calls and emails of their mailing list) that alleged cybersquatting is the entirety of the dispute between the complainant (in this case an IGO, but conceivably anybody initiating a domain dispute if some future arbitration system is added to the UDRP for non-IGO complainants) and the domain name owner. However, in many situations, that assumption will not be correct.

A domain name owner who seeks to challenge an adverse UDRP/URS decision in court is not limited to making their court dispute only about domain names. They are entitled to bring up all potential claims against the other side. For example, if the domain name owner who is seeking relief in the courts from an adverse UDRP/URS decision was an alleged victim of some IGO misbehaviour, all of that would appear in their statement of claim at the court. If the IGO successfully asserts immunity at that court, not only does it prevent the domain name aspect of the case to be decided on the merits by the courts, it also prevents the court from hearing the rest of the case on the non-domain name portions.

If the UDRP/URS had not existed, the IGO might not ever have taken the domain name owner to court, because they might have feared a counter-claim against them which would either partially or potentially more than offset the value of the domain name. [Indeed, it might not just be the domain name owner who would counter-claim in court…once the IGO submits to the jurisdiction of a court, other victims might appear and join the case.]

For example, suppose a rape victim of the World Health Organization [WHO] (there was a major scandal recently) was prevented from getting civil damages, due to the WHO’s immunity. She registers a domain name such as WorldHealthOrganizationRapedMe.tld to tell her story. In the absence of the UDRP/URS, if the WHO wanted to challenge the ownership of that domain name in court, they’d have to give up their immunity and she could counter-sue them for damages related to the rape. Given the potential financial risk, the IGO would be very reluctant and unlikely to give up their immunity by taking cases to court, if the other side had a valid claim that would result in large damages against them.

But, suppose they still wanted to take the site down, for whatever reason, perhaps reputation management (this is a hypothetical related to rape, but the domain owner could be an unpaid supplier, or a victim of environmental damage, or some other victim with a valid grievance unable to get relief due to the IGO’s immunity normally). The IGO files a UDRP/URS, and amazingly wins (such strange outcomes plague the UDRP, as has been noted that some panels do not see free speech issues the ways those of us in Canada and the USA do). Regardless, if the domain name owner takes the case to court to challenge the adverse domain name outcome, she can certainly also include the claim for damages related to her alleged sexual abuse. [indeed, she might even file a class action lawsuit, and make things even more interesting with multiple complainants]

If the judge in the court case denied a full hearing, due to the IGO’s immunity, tossing it out on a “technicality” and not allowing for a decision on the merits, what happens next? That’s what the current working group is debating. They appear to be pushing for arbitration as a “solution”.

However, what would be the subject matter of the arbitration? Fairness dictates that the rape victim should be able to state the full claim at such an arbitration panel, and not just be limited to domain name issues!

It would be fundamentally unfair if the arbitration was limited just to domain names, because an IGO cannot selectively carve out aspects of their immunity, when they submit to the jurisdiction of a court. It’s all or nothing, as noted above (i.e. which is why they never took her to court in the first place regarding the domain name, for fear of a counterclaim involving sexual misconduct civil damages).

Indeed, in the prior working group, of which I was a member, we even offered IGOs the opportunity to have an express “limited waiver of immunity” provision as a modification of the current “mutual jurisdiction” clauses in the UDRP/URS. IGOs felt that wouldn’t protect them, so by their own analysis and stated positions at ICANN, it appears to be “all or nothing.” They don’t get to pick and choose. [if, on the other hand, they are able to pick and choose which aspects of their immunity they are able to give up, and limit things only to the domain name, then that would have been a complete solution to the IGOs’ alleged ‘problem’, and the working group would have completed its work years ago]

This is a game-changer, because it means that ICANN would have to create, for fairness, an arbitration system that would handle non-domain name disputes, as long as domain names are a portion of the overall dispute between the parties. I think this goes far beyond ICANN’s capabilities, and shows that the new working group hasn’t fully considered the ramifications of their proposals.

Indeed, the current report suggests they are intending to remove the mutual jurisdiction clause in its entirety (without an adequate replacement), which is far beyond what the prior working group ever did. This would allow “forum shopping” and tactical use of the UDRP/URS by IGOs, who would attempt to retain immunity from the non-domain name aspects of their overall dispute with the domain name owner. It invites abuse and misuse.

If ICANN ever contemplates binding arbitration for non-IGO disputes, similar situations might take place, where counter-claims by the domain name owner that would offset claims against them for alleged cybersquatting would all need to be heard in arbitration, out of fairness (to avoid tactical advantage for one side or the other, relative to the courts). So, trademark cancellation claims, for instance, might be natural counter-claims by domain owners, which would have to be heard by panelists. Employment disputes, anti-whistleblower claims, environmental claims, and so on. Should ICANN design arbitration systems to handle such complexity? Of course not.

Taken to the “extreme”, it could allow governments (since IGOs are the creation of government) to challenge domain names, and even perhaps registered trademarks or other disputes outside the court system, in an ICANN-designed arbitration system. For example, if the South American countries who were vehemently opposed to the dot-Amazon TLD created a treaty with an IGO which had rights to the term “Amazon”, what’s to stop them from challenging the ownership of the Amazon.com domain name? Would Jeff Bezos’ company be forced to an arbitration, where the laws and legal protections might be those of South America, and give up their rights to access the courts in the USA? Could Jeff Bezos’ company even be forced by an unaccountable panel to relinquish ownership of their prized domain name without any recourse to the courts to challenge what most would perceive to be a “perverse” outcome? (although, those in South America might see that as the “correct” outcome) Sometimes panels just make the wrong decision – would Amazon agree to put such power over its assets into the hands of a small number of panelists, who could be potentially bribed, or have some other bias against them, and whose incorrect decisions could not be challenged in the courts of the United States?

IGOs are the creation of governments, in some ways an unaccountable alter ego and amalgam of groups of them. It’s the national courts that protect citizens from abuses by their governments. Any form of involuntary arbitration risks being misused, given that they can lead to different outcomes than national courts.

Ultimately, ICANN needs to realize that there are 2 kinds of domain name disputes — the simple ones involving low value domains with obvious cybersquatting, and all the rest (complex, high stakes, etc.).  Once there is any “complexity”, ICANN should say “Go to court, we’re not the place for such disputes.” When the stakes are at their highest, that’s when domain owners need the protection of the courts, to prevent mischief that often exists in the arbitration system (e.g. NAF was forced out of consumer arbitration).

Instead, ICANN has wasted millions of dollars in time and actual dollars trying to think about how to take on disputes that belong in the courts. Those responsible for such mission creep should be held accountable. ICANN needs to be smaller and focused on a narrow mission.