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Dr. David Taylor - Protecting your brand in new gTLDs

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  • 1. Protecting your brand in the new gTLDenvironmentDavid Taylor, Partner, Hogan Lovells Domain Name Practicedavid.taylor@hoganlovells.comNewdomains.org – The Munich Conference on new TLDsMonday 26 September 2011
  • 2. Introduction•  Part I Setting the scene –  The domain name industry today –  Brand protection in the current TLDs and generics•  Part II New gTLDs –  Preparing for the launch of new gTLDs •  background •  concerns to IP owners •  trade mark protection •  considering a .brandwww.hoganlovells.com 2
  • 3. Part I Setting the scene–  The domain name industry today–  Brand protection in the current TLDs and generics
  • 4. A few preliminary questions…•  Who has filed a UDRP complaint as a brand owner or as counsel?•  Who has had a UDRP filed against them?•  Who has attended an ICANN meeting?•  Who has read the AGB?•  What is the first word on page 258 of the "Final" AGB… •  "Litigation"….www.hoganlovells.com 4
  • 5. Developments in the last decade some "new" gTLDs already•  The original magnificent 7 •  .com; .net; .org; .int; .gov; .mil; .edu•  The 2000 group of 7 •  .aero; .coop; .museum; .biz; .info; .name; .pro•  The 2004 group of 7 •  .asia; .cat; .jobs; .mobi; .post; .tel; .travel•  In 2011 •  .xxx•  2012 onwards group of... 7? 70? 700?www.hoganlovells.com 5
  • 6. Domain name registrations today •  Two kinds of TLDs (Top Level Domains) –  Generic (gTLDs) •  22 gTLDs –  Country Code (ccTLDs) •  273 ccTLDs •  In 1992 fewer than 15,000 dotCOM domain names registered •  Today we have circa 200 million... •  Eligibility requirements vary widely in the ccTLDswww.hoganlovells.com 6
  • 7. Variation of pre-registration requirements across the EU •  Unrestricted •  Partially restricted •  Restrictedwww.hoganlovells.com 7
  • 8. ccTLDs in the EU today •  55 ccTLD extensions No restrictions: Austria, Belgium, Czech Republic, Denmark, Greece, Italy, Latvia, Lithuania, Poland, UK •  ccTLD registrations in EU now 45 million –  Nearly 1/4 of total worldwide registrations –  cf June 2007 nearly 30 million •  EU not intended to replace ccTLDs –  3.4 million registered today •  Most popular: – .com, .de, .net, .uk, .org, .cn, .info, .nl, .eu and .ruwww.hoganlovells.com 8
  • 9. Top Ten EU Member States Domain Name Registrationsas at December 2010 Sweden 1,061,500 Denmark United Kingdom 1.104.700 9,005,700 Netherlands 4,202,300 Poland Belgium 2,003,800 1,104,100 Germany 14,038,400 France 1,903,900 Italy 2,047, 100 Spain 1,257, 200www.hoganlovells.com
  • 10. Dispute Resolution Policies across the EU •  13 ccTLDs have adopted UDRP or variation of it (.co.uk, .it, .be, .dk, .fr, .es, .ie, .lv, .cy, .ro, .nl, .si, .hu) •  9 ccTLDs have no ADR at all (.de, .gr, .fi, .sk, .ee, .lt, .lu, .mt, .bg) •  3 ccTLDs are subject to arbitration (.pl, .cz, .pt) •  2 ccTLDs have specific ADR rules (.at, .se)www.hoganlovells.com 10
  • 11. The problems brands face today •  "The sale and broad expansion of new TLDs in the open market, if not properly managed, will provide abundant opportunities for cybersquatters to seize old ground in new domains" –  Francis Gurry, WIPO: 16 March 2009www.hoganlovells.com 11
  • 12. www.hoganlovells.com
  • 13. www.hoganlovells.com
  • 14. www.hoganlovells.com
  • 15. UDRP (Uniform Domain Name Dispute Resolution Policy) - WIPO figures •  55 ccTLDs have adopted (a variation of) the UDRP •  More than 17,000 cases covering 32,000 domain names •  In 2010 the highest ever, with 2696 cases •  In 2011 1958 cases to datewww.hoganlovells.com 15
  • 16. Geographical distribution of parties gTLDs (to May 2010) Up Upwww.hoganlovells.com
  • 17. Domain name dispute resolution today •  Global problem •  Not every country makes use of the UDRP •  Variation in domain name dispute mechanisms across the EU •  A tendency towards Fast Track Procedures –  WIPO, URS, CAC, Nominet, AFNICwww.hoganlovells.com
  • 18. It is complex today – and it is going to get worse tomorrow... -  already costly and complex to either defensively register or enforce -  increased number of TLDs = more opportunities for cybersquatters -  here we go again -  clear need for TM protection mechanisms and the world and the internet have changed...www.hoganlovells.com
  • 19. Another factor to consider:the value of ‘‘generic’’ domain names todaywww.hoganlovells.com 19
  • 20. The value of ‘‘generic’’ domain names today •  flowers.com (October 2006) •  clothes.com (May 2008) US$ 1.5 million US$ 4.9 million •  vodka.com (December 2006) •  toys.com (February 2009) US$ 3 million US$ 5.1 million •  diamond.com (May 2006) •  slots.com (April 2010) US$ 7.5 million US$ 5.5 million •  fund.com (March 2008) •  sex.com (November 2010) US$ 10 million US$ 13 millionwww.hoganlovells.com 20
  • 21. www.hoganlovells.com 21
  • 22. Current issues for brand owners •  Automatic registration software •  Growth of registrations across existing TLDs •  Cost of bringing action before courts •  Variation of dispute resolution policies •  IDNs •  Abuse in the DNS –  Cybersquatting, Front-running, Gripe sites, Fake renewal notices, Name spinning, Pay-per-click, Traffic diversion, False affiliation, Domain kiting / tasting, false WHOIS •  Many new gTLDs for 2012 and beyond   Consumer confusion   Mulitiplication of Threats to IPR holderswww.hoganlovells.com 22
  • 23. Part II new gTLDs – a changing landscape–  Preparing for the launch of new gTLDs •  background, concerns to IP owners, trade mark protection–  Pros and Cons of applying •  opportunities of considering a .brand–  Timing
  • 24. Preparing for the launch of new gTLDsBackgroundConcerns to IP ownersTrademark protectionThreats and opportunities
  • 25. A shake up of the DNS and Internet in 2012•  The launch of new generic top-level domains (new gTLDs) in 2012 is likely to cause an unprecedented shake up to the domain name system and the Internet.•  Whilst the aim is to enhance diversity, choice, competition and innovation, it will inevitably cause a considerable burden on rights owners across the globe who will need to carefully reconsider their online strategies.www.hoganlovells.com 25
  • 26. Why? •  "to enhance competition and promote choice and innovation" Looking for a hotel in Munich? www.hotels.com? www.hotels.de? www.munich.hotels? www.hotels.munich? or just use Yahoo Google or Bing!?www.hoganlovells.com 26
  • 27. What are new gTLDs?•  Announcement by ICANN to allow an unlimited number of new gTLDs on 26 June 2008•  A first draft applicant guidebook was issued in October 2008•  Seven subsequent drafts have followed•  "Final" AGB published on 19 September 2011•  Both a threat and an opportunity to business and brand owners –  Some 170 applicants are making noises that they will be applying –  How many will apply but are keeping quiet?www.hoganlovells.com 27
  • 28. City domain applicantswww.hoganlovells.com 28
  • 29. Regional domain applicantswww.hoganlovells.com 29
  • 30. Industries, goods and services, lifestyle and keywordswww.hoganlovells.com 30
  • 31. Are brand owners going to be left out in the cold this winter?www.hoganlovells.com 31
  • 32. .brand applicants .hitachiwww.hoganlovells.com 32
  • 33. Not for Profits “Taking the long view, as time goes on a name such as www.donations.unicef and www.cards.unicef will become more intuitive in a more crowded Internet, and thus more valuable because the name reflects exactly that of an organization and declares what it does.” - June 2010 RFPwww.hoganlovells.com 33
  • 34. Concerns to IP owners...•  Potential for significant increase in cybersquatting at the second level and increase of defensive registration and dispute costs •  eg olympics.london •  eg microsoft.web •  eg louisvuitton.paris•  Risk of cybersquatting at the top level? –  Not really•  Risk of permanent string preclusion at the top level –  Quite possible for instance .ALAN preventing .ELLENwww.hoganlovells.com 34
  • 35. Existing RPMsUniform Domain Name Dispute Resolution Policy UDRPwww.hoganlovells.com 35
  • 36. A need for new ones?•  "to develop and propose solutions to the overarching issue of trademark protection in connection with the introduction of new gTLDs" – the task of the IRT March 2009www.hoganlovells.com 36
  • 37. Timeline – TM protection and a bumpy ride for RPMs •  Feb 2009 ICANN Mexico City ‐IP Community requests enhanced trademark solutions •  Mar 2009 Implementation Recommendation Team (IRT) formed and given 8 weeks •  May 2009 IRT Report published and proposed new trademark solutions •  Summer 2009 Global Consultation (Sydney, New York, Hong Kong, and Abu Dhabi). General support for certain IRT recommendations, with modifications •  Nov 2009 Board sought GNSO input on expedited basis on several TM solutions •  Dec 2009 GNSO formed Special Trademark Issues (STI) drafting team reaches consensus on revised trademark solutions •  Dec 2009 GNSO unanimously approves STI Recommendations •  Feb 2010 Revised Models & Explanatory Memoranda Posted •  Apr 2010 Final comment period ended •  Sep 2010 INTA letter to ICANN Board stressing need for resolution of TM issues •  2011 Continued discussion / pressure / GAC / IP lobby •  19 Sep 2011 "Final" Applicant Guidebookwww.hoganlovells.com 37
  • 38. The problems and proposed solutions...•  Cost and administrative burden to rights owners of reacting to Sunrise & other RPMs •  Trademark clearing house•  Cybersquatting continues, consumers misled, UDRP & Courts take time and money •  URS•  What to do with a registry operator who acts inconsistently with representations or has bad faith intent to profit from systemic cybersquatting. •  PDDRP•  No single source availability of data •  Thick whoiswww.hoganlovells.com 38
  • 39. URS – "Rapid" became "Redundant" now "Replenished" Day 0 Complaint to provider (Form complaint, TM + grounds + whois + 500 words) Day 3 Administrative Review Complete Day 4 Notification to registry operator Day 5 Domain name locked Day 6 Notification to registrant eUDRP (WIPO) Nokia Corporation v. Jameela Seif Case D2009-1665 Filed 14 December 2009, decision 18 January 2010 = 35 days Day 20 Response due date Day 27 Extension possible for Response date Day 32 Decision date goal (i.e. 5 days but goal is 3 days) In previous versions had reached 47 days… Still possibility for appeal Review of URS after 1 yearwww.hoganlovells.com 39
  • 40. The solutions proposed Trademark Clearing House Post Uniform Delegation Rapid Dispute Suspension Resolution Procedure GPML Thick WHOISwww.hoganlovells.com 40
  • 41. The opportunity for brandsThe possibility of registering .brand: the opportunity thatmirrors the challenge
  • 42. Application overview•  Rigorous –  US$185,000 application fee –  Application form with 50 questions requiring detailed answers •  Application likely to be in the region of 100+ pages in length •  Rigorous technical (including IPv6 and DNSSEC), financial, and business operation questions –  External evaluation by industry experts –  Substantial financial resources needed to operate or pay for outsourced operation –  Applicants need to provide funds in escrow or letter of credit to operate the TLD for ≥ three years following a business failure•  Potential additional fees associated with the application process (e.g. Extended evaluation fee (US$ 50,000), Objection fees or dispute resolution filing fees (from US$ 1,000 to 5,000 per party per proceeding).www.hoganlovells.com 42
  • 43. Some potential Pros of applying for a .brand•  New gTLDs will allow you to be in charge of your own brand gTLD•  You will have control of second level domain names under potential new gTLDs (ANYTHING.BRAND)•  Protect IPR – currently no co-existence, may also provide a broader protection of the brand: If .BRAND is registered, new gTLD strings that are confusingly similar may not be permitted•  Enhance online brand promotion and visibility, defend assets and market position•  First mover advantage - ICANN plans round after round of new gTLDs: this is the first stage of a long-term plan - early adopters have at least a 3-5 year advantage•  Secure corporate and client networks (this could facilitate the provision of services to clients via a dedicated portal)www.hoganlovells.com 43
  • 44. Some potential Pros of applying (continued)•  Help prevent fraudulent practices such as counterfeit products/films through the Internet•  Not losing ground to competitors and potentially being left behind as new gTLDs establish themselves in the future as branding moves to the right of the dot•  Potential platform for innovation. Running an open registry could be profitable•  Risk of Permanent String Preclusion –  To ensure prevention of user confusion and loss of confidence in the DNS resulting from delegation of many similar strings into the root zone. –  Any string yielding a similarity level of 30% or above is cited. –  If Brand ELLEN did not apply and an application for a string similar to .ELLEN was accepted in the first round, such as .ALAN, then an application for .ELLEN could potentially be precluded in subsequent rounds of application as would be too similar to an existing TLD.www.hoganlovells.com 44
  • 45. Some Cons of applying•  Uncertainty in relation to the success of these new gTLDs and adoption of this new model by Internet users, search engines... a dead dodo?•  .COM value here to stay in medium term as the premium domain name space•  No one knows what competitors will do and what will become industry best practice•  Relatively high costs of application and operation (circa US$ 1 million to US$1.5 million over 2011 to 2016)•  Will need considerable management focus over the next 24 months•  ICANN has developed this for communities and investors not brand owners•  Waiting until the second round likely less expensive to apply, rely on objection processwww.hoganlovells.com 45
  • 46. Business plan - considerations•  What do you intend to achieve by registering the new gTLD?•  What are the business drivers behind the new gTLD application?•  Need to provide thorough answers to ensure sufficient basis for evaluation•  What are competitors or conflicting third parties doing? What are the potential outcomes of disputes?•  How will the new gTLD be run? –  Standard or Community gTLD? –  Will anyone be able to apply for a registration? –  What RPMs will you employ? (TCH, URS, PDDRP, WHOIS) –  Will it only be available to your customers? –  Will it be only used for internal corporate IT infrastructure and web presence? –  Will you offer IDNs at the second level? –  Who will Abuse point of contact be?•  How will the ownership and operation of a new gTLD fit with your current businesses?www.hoganlovells.com 46
  • 47. Anticipated timeline for new gTLDs 30 May 2011 Version 7 AGB 20 June 2011 published ICANN meeting in 19 September Singapore and 2011 "Final" Applicant 12 January 2012 Board approval Guidebook Application window Published opens for 3 months End 2012 through 2013 and beyondwww.hoganlovells.com 47
  • 48. Conclusion•  New gTLDs are coming•  Likely to cause a radical shake up in the DNS•  A threat to brand owners: Brands need to reassess defensive registration stratgey, portfolio and budgets•  An opportunity for some brand owners: Brands need to fully consider whether to apply or not, all of the pros and cons•  The application window is set, 12 January 2012 for 90 days: dont leave it till the last minute to apply!•  I would estimate that over 50% of applications will come from brandswww.hoganlovells.com 48
  • 49. To ponder... If Toys"R"Us willing to pay US$ 5.1 million for toys.com perhaps US$ 500,000 to US$ 1 million for .TOYS is not so much?www.hoganlovells.com 49
  • 50. New gTLDs – who needs to bother? A game of cat and mouse? Well my cat is preparing... Thank you for your attentionwww.hoganlovells.com 50
  • 51. 11.45 Panel session – protecting brands in new gTLDs•  Valentina Schulte-Braucks •  TM attorney at Noerr LLP, "TMs in jeopardy: Is .com Old news?"•  Dr Markus Bahmann •  TM attorney, member of the INTA Internet Committee, MD of .BAYERN•  Dr Torsten Bettinger •  TM attorney, member of legal advisory board for .DE, WIPO panelist•  Jonathan Robinson •  Not a TM attorney, founder of IPRota Ltd for TLD support, ICANN GNSO Council•  Moderator: David Taylorwww.hoganlovells.com 51

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