New gTLDs: WIPO's Legal Rights Objection Procedure for Trademark Owners

Regardless of whether your organization has applied for a New gTLD, you should pay close attention to what New gTLDs are being applied for to protect your rights and other legitimate interests. Since 13 June 2012, all applied for gTLDs have been published on ICANN’s [New gTLD site]. ICANN also provides the [public sections] of all applications. In particular question 18(a) may be of interest for any evaluation if a TLD may infringe intellectual property rights:

18(a). Describe the mission/purpose of your proposed gTLD.

Currently it is also possible to [comment on an application] during the ongoing New gTLD evaluation process although ICANN will only forward comments within 60 days after the Reveal Day (from 13 June 2012 to 12 August 2012) to the evaluation panels. All comments made, even after the 60 day period [may be viewed] as well. Unlike a formal objection, comments do not trigger a formal objection procedure.

Within a 7 month period, starting on 13 June 2012, any party may therefore [file a formal objection], triggering a dispute resolution procedure. These procedures are laid out in Module 3 of ICANN’s Applicant Guidebook. A formal objection may be filed on any one of the following four grounds:

1. String Confusion Objection:

The applied-for gTLD string is confusingly similar to an existing TLD or to another applied-for gTLD string in the same round of applications.

2. Legal Rights Objection:

The applied-for gTLD string infringes the existing legal rights of the objector.

3. Limited Public Interest Objection:

The applied-for gTLD string is contrary to generally accepted legal norms of morality and public order that are recognized under principles of international law.

4. Community Objection:

There is substantial opposition to the gTLD application from a significant portion of the community to which the gTLD string may be explicitly or implicitly targeted.

In this article we are examining the Legal Rights Objection Procedure (LRO) only, a mechanism that protects trademark owners from the applicant’s use of the TLD. The Arbitration and Mediation Center of the World Intellectual Property Organization (WIPO) has been appointed by ICANN as the exclusive dispute resolution service provider for trademark based Legal Rights Objections. This mechanism forms part of the available Rights Protection Mechanisms for New gTLDs. The following paragraphs will disregard references to rights and procedures for intergovernmental organizations (IGOs), also addressed in the dispute resolution procedure for (trademark) rights holders.

Who can object?

Regarding Legal Rights Objections, the objector must be a rights holder whose rights are being infringed. Typically these are trademark owners whose brands may be infringed by the applied-for New gTLD but new gTLD applicants are also eligible as long as they are also rights holders. Rights holders are parties that own a registered or unregistered trademarks oder service marks.

Applicable rules for trademark related legal rights objections:

• Module 3, Dispute Resolution Procedures, Applicant Guidebook
• Attachment to Module 3, New gTLD Dispute Resolution Procedure
• WIPO Rules for New gTLD Dispute Resolution.
  In the event of any discrepancy between Module 3 and the WIPO Procedure, the WIPO Procedure shall prevail. In any event, the parties are not precluded from filing a lawsuit with the competent ordinary jurisdiction.

DRSP Procedural Elements:

1. Filing of Complaints and Responses: Electronically with WIPO, including a copy for ICANN and the applicant. The filing language for complaint and response is English, although supporting evidence may be submitted in the original language, as long as it is accompanied by a certified translation. Objections are limited to 5000 words or 20 pages, whichever is less, excluding attachments. Each party must provide copies to the other party.
2. Administrative Review: The DRSP checks compliance with all procedural rules within 14 calendar days of receiving the objection. Compliant objections enter next phase, noncompliant objections are dismissed.
3. Consolidation of Objections: The DRSP may consolidate objections at its own discretion, e.g. when multiple objections address the same application based on the same grounds.
4. Mediation: The parties are encouraged — but not required — to participate in mediation. There is no automatic extensions of time associated with the conduct of mediation but absent exceptional circumstances an extension of up to 30 days time may be granted .
5. Expert Selection: One expert. Unlike UDRP proceedings three experts are only appointed if both parties agree.
6. Adjudication: Disputes will usually be resolved without an in-person hearing. The panel may decide whether any additional written statements besides objection and response may be submitted and may also specify time limits for such submissions.
7. Expert Determination & legal consequences: WIPO will publish all decisions in full on its website. The decision will be considered an expert determination and advice that ICANN will accept within the dispute resolution process. Although ICANN is not bound by the expert determination ICANN would have to have good reasons to ignore WIPO’s expert advice. The objector is not entitled to damages. The consequences for non-action by applicant to formally correct objection is the rejection of the New gTLD application.

Dispute Resolution Standards:

The objector bears the burden of proof in each case. The panel may also refer to other relevant rules of international law in connection with the standards. The principles outlined below are subject to evolution based on ongoing consultation with DRSPs, legal experts, and the public.

The panel has to determine whether the potential use of the gTLD

• takes unfair advantage of the distinctive character or the reputation of the objector’s registered or unregistered trademark or service mark (“mark”) or

• unjustifiably impairs the distinctive character or the reputation of the objector’s mark or otherwise

• creates an impermissible likelihood of confusion between the applied-for gTLD and the objector’s mark.

For trademark based objections ICANN has specified a non-exclusive list of factors that the panel will consider:

1. Identity or similarity (appearance, phonetics, meaning)
2. Objector’s bona fide acquisition/use of the mark
3. Relevant recognition by the public
4. Knowledge of the objector’s mark, any pattern of applicant infringement
5. Applicant’s use (including preparations) of the mark in connection with a bona fide offering
6. Applicant’s rights in the mark, including whether such acquisition/use has been bona fide, and whether the intended TLD use is consistent therewith
7. Whether applicant is commonly known by the mark
8. Whether the applicant’s intended use would create a likelihood of confusion

Filing Window:

The Legal Rights Objection period is expected to last approximately 7 months, from May 1 to December 1, 2012

Duration of the proceedings:

After the objection window has been closed, ICANN will publish a "Dispute Announcement" listing all objections that have passed the administrative compliance review. The announcement will be no later that 30 days after the close of the objection window. WIPO will then notify New gTLD applicants of pending objections. Within 30 days applicants will have to file a response and WIPO will appoint the expert panel. Under normal circumstances the panel will render its determination within 45 days of appointment. According to ICANN, absent any unforeseen circumstances, the resolution process is intended to take approximately five months.

Costs:

An LRO procedure will cost each party USD $ 10,000 (USD $ 2,000 administration, USD $ 8,000 panelist) with one expert on the panel. In other words, a complaint and a response cost USD $ 10,000 each. A three member panel increases the costs for each party to USD $ 23,000 (USD $ 3,000 administration, USD $ 20,000 panelists) according to the Schedule of Fees and Costs. The gTLD applicant is not obliged to file a response but non-payment of the response fees by a TLD applicant will directly impact his application since it results in the objection being deemed successful. This means that even an objection without merit stalls the gTLD application.