New Best Practices for Trademark Owners in an Era of Ever Increasing gTLDs

As new domains become available, trademark owners with an internet presence should consider adopting new best practices to protect their marks.  By way of background, a generic top level domain (“gTLD”) is the alpha numeric string that appears after the “dot” in a web site URL.  The most ubiquitous such creature is the well-known “.com.” In the 1980s, the Internet Corporation for Assigned Names and Numbers (ICANN)–the mysterious not-for-profit corporation under contract with the US Department of Commerce to see to the proper functioning of the Internet’s system of addresses–created seven gTLDs: .com, .edu, .gov, .int, .mil, .net, and .org.. In years following the creation of the original gTLDs, discussions concerning additional gTLDs led to the selection in November 2000 of seven new gTLDs for introduction: .biz, .info, .name, .pro, .aero, .coop, and .museum. In 2003, ICANN initiated a process that resulted in the introduction of six new gTLDs (.asia, .cat, .jobs, .mobi, .tel and .travel).  Most recently, .xxx has been added to the mix.

At each step along the way, the introduction of new gTLDs created anxiety for trademark owners concerned that each new gTLD opened up opportunities for domain name brokers to hijack or cybersquat on second level domains consisting of valuable trademarks.  For instance, acme.com might find that there are cybersquatters hosting sites at acme.org or acme.asia.  In response to these concerns, at each launch of a new set of gTLDs, ICANN implemented a so-called “sunrise” period, enabling trademark owners to get first dibs on any new domain name consisting of a trademark owner’s trademark.

During the late 1990’s and early 2000’s, this led to a “best practices” regime of domain name management  that consisted primarily of trademark owners registering thousands of domain names consisting of their trademarks in an effort to prevent others from doing so. 

Given developments in the gTLD area in the last two years, however, this approach is no longer workable.

Cybersquatting and the UDRP

Recently, I was a guest lecturer at the trademark law class at the University of Maine School of Law, invited by my colleague, Rita Heimes, director of the Maine Center for Law and Innovation.  I always enjoy an opportunity to discuss trademark law in an academic setting, and it is invigorating to meet aspiring young trademark lawyers.

The topic for my talk was the Uniform Dispute Resolution Policy (“UDRP”). For those unfamiliar with this policy, it helps protect businesses against “cybersquatting.”  For instance, if the owner of the Acme brand discovers that the domain name "acme.com" is registered by someone else, and is being used in bad faith, the UDRP is the most effective tool available for Acme to recover that domain name.  Prior to the creation of the UDRP, the prospects for success in a domain name dispute were uncertain, and the costs were potentially exorbitant.  In the mid to late 1990's, when widespread use of the Internet was first becoming prevalent, it was unclear whether existing trademark doctrine enabled the recovery of a domain name in this manner, and in any event, the only way to find out was to launch an expensive and time consuming lawsuit.  This time period was typified by a “gold rush” for ownership of domain names and many famous brand owners discovered to their dismay that their best option for securing the all-important “.com” domain name was to pay millions of dollars to the prescient person who had beaten them to the punch.

The UDRP was introduced at the insistence of brand owners by the Internet Corporation for Assigned Names and Numbers (“ICANN”), the entity that governs the allocation of Internet "real estate," in order to address the gap left by preexisting law.  Any person registering a domain name must consent to participation in the UDRP’s form of alternative dispute resolution, and agree to abide by the dispute resolution’s results. Typical costs to recover a domain name using this process are between $1500 and $3000, the success rate is very high (around 85%), and the process can be completed in a month or less.  The UDRP has been around for more than 10 years and has been used very effectively by brand owners to recover millions of improperly registered or used domain names.  Accordingly, it no longer qualifies for "cutting edge" status, although it is surprising how many brand owners remain unfamiliar with it.

In the course of preparing my remarks, however, I also had occasion to delve into some of the remaining challenges in this area, and to explore recent noteworthy developments.