The Trademark Clearinghouse and ICANN’s New gTLD Program: Considerations for Trademark Rights Owners

Author: Kristen Dorsch, Associate Member, University of Cincinnati Law Review

I. Background

In 2011, the Internet Corporation for Assigned Names and Numbers (ICANN) approved a plan to expand the number of available top-level domains beyond the widely-used “.com” and “.net” domains, in an effort to enhance diversity, choice, and competition on the internet.  This unprecedented expansion will radically increase the number of available generic top-level domains (gTLDs) from fewer than twenty to more than a thousand.  ICANN has proposed the Trademark Clearinghouse as a protective measure to safeguard the rights of trademark owners.  The Trademark Clearinghouse will serve two primary functions: to authenticate and validate the rights submitted to the Clearinghouse; and to serve as a database to provide information to the new gTLD registries to support pre-launch Sunrise or Trademark Claims Services.[1]

II. The Trademark Clearinghouse

Inclusion in the Trademark Clearinghouse requires that the trademarks be either registered (regionally or nationally), judicially validated, protected by statute or treaty, or constitute other intellectual property.  For an estimated $150,[2] trademark owners can deposit their trademark data with a centralized source instead of with each new gTLD registry.[3]  Many trademark owners mistakenly believe that, by registering their trademarks with the Trademark Clearinghouse, ICANN will automatically block the registration of all domain names containing their trademarks in the new gTLD program.[4]  This widely-held misconception that the Trademark Clearinghouse is a cure-all for domain-related trademark concerns reflects the expectations of trademark owners, rather than the actual remedies that the Trademark Clearinghouse is prepared to offer.

The Trademark Clearinghouse will also support two rights protection mechanisms (RPMs) that new gTLD registries must provide.[5]  The first of these mechanisms is the Sunrise Service, which allows trademark owners to register exact matches of their trademarks in new gTLDs before registration opens to the general public.[6]  The second of these RPMs is the Trademark Claims service, which is intended to create awareness of possible trademark infringements for proposed domain name registrations, as well as provide notification to trademark owners that their Clearinghouse record matches a recently registered domain name.[7]

The Sunrise Service requires registries to offer a 30-day window prior to the launch of the gTLD, during which trademark owners may register exact matches of their trademarks in the new gTLD before registration opens to the general public, effectively allowing trademark owners to get a jump-start on cybersquatters.  The efficacy of the Sunrise Service is limited by the fact that registry operators are permitted to have their own Sunrise eligibility criteria, such as a separate fee and additional verification processes, in addition to ICANN’s minimum requirements.[8]  The result is likely to be that trademark owners who have registered with the Trademark Clearinghouse may nevertheless not be able to take advantage of the registry’s mandatory Sunrise period should the trademark owner not be able to meet the more stringent requirements of that particular registry operator.

The Trademark Claims service notifies domain name registrants when they attempt to register a domain name that is a match to a trademark registered in the Trademark Clearinghouse, but the process does not prevent trademarks from being registered as domain names.[9]  Upon receipt of notice the registrant merely has to attest that to the best of his knowledge the registration and use of his domain name will not conflict with the rights of the trademark owner.[10]  In theory, this allows businesses with the same name but that operate in different realms to coexist,[11] such as Delta Airlines and Delta Faucets. Critics have been quick to point out, however, that a bad actor could lie about his intention and proceed with the infringing registration.[12]  This lack of an enforcement mechanism calls the utility of the Trademark Claims service into question, because it seems unlikely that a cybersquatter intent on infringing a company’s trademark will be dissuaded by a simple reminder that he is about to infringe on the rights of a trademark owner.

Further limiting the utility of the Trademark Clearinghouse is the use of the “Identical Match” standard to determine a match between a trademark string and a domain name.[13]  “Identical Match” means that the domain name consists of the complete and identical textual elements of the trademark string.[14]  Notably, in the Trademark Clearinghouse, plural forms of a trademark do not qualify as an identical match.[15]  This works to the advantage of typosquatters, who are notorious for registering domain names with slight typographical differences from the trademarked term.  The identical match requirement has fueled fear amongst many business entities that the launch of hundreds of new gTLDs could force trademark owners to file numerous defensive domain name registrations for no commercial purpose other than to preempt a cybersquatter from registering the trademark or a slight variant.[16]  With industry-specific gTLDs such as “.insurance” poised to hit the web, related corporations will likely scramble to register not only their brand name, but also possible misspellings and other variations in order to maintain their brand integrity.

III. Possible Alternatives

One alternative solution to the shortcomings of the Trademark Clearinghouse is for gTLD registries to step up their own registration policies to enhance the protections available for trademark owners. Some registries already have announced their intention to enrich the Sunrise service period mandated by ICANN. ICM Registry, the operator of the .xxx TLD, pioneered a rights protection mechanism known as “registration block.”[17]  The .xxx TLD caused an outcry by trademark owners who argued that registration of their mark in the .xxx string was the only way to block registration of the mark by another party, and trademark owners would therefore be forced to defensively register their marks in the .xxx string in order to prevent loss of goodwill with their trademarks, prevent consumer confusion, and prevent association with the adult entertainment industry.[18]  For a one-time fee of approximately $200 per domain,[19] ICM Registry allows companies that were not part of the “global adult entertainment industry” to seek permanent removal of names matching their trademarks from the pool of names available for registration with the .xxx string.[20]  Under ICM’s system, all trademarks that had been removed from the pool would automatically resolve to a generic informational page with a message that the domain had been reserved from registration.[21]  Although ICM Registry’s innovative registration block was formulated to avoid a fight with trademark holders and a potential public relations fiasco,[22] its success suggests the plausibility of enhanced rights protection mechanisms enacted by the registry operators as a viable solution to the shortcomings of the Trademark Clearinghouse.

The Association of National Advertisers (ANA) has proposed a “Do Not Sell List” as an added step ICANN can take to protect the rights of trademark owners by registering their trademark names to block prospective registrations across all gTLDs.  Inclusion in the Do Not Sell List would automatically block the registration of infringing names.[23]  Not only would the Do Not Sell List accept trademarks, it would also accept generic words used with the mark as well as common misspellings of the mark,[24] which would help to combat typosquatters.  The implementation of a single registry or database in which trademark owners can register the names they wish to protect across all new gTLDs is a feasible extension of ICANN’s already-existing framework for the Trademark Clearinghouse.  The Trademark Clearinghouse is already prepared to accept the registration of trademarks, so under the proposed Do Not Sell List the enrollment criteria would simply be extended to include misspellings and generic terms that are used with the trademark.  Additionally, the Do Not Sell List would provide protection for trademark owners indefinitely, until the trademark owner requests removal of its name(s) from the list. While the Do Not Sell List would provide much stronger protections for trademark holders, it would not leave domain registrants without recourse if they have a legitimate, non-infringing registration. Domain name registrants would still be able to avail themselves of a dispute resolution system administered by WIPO.[25]

While ICANN was likely well-intentioned in its formulation of trademark protection measures, the framework in place will not adequately protect the rights of trademark owners.  With approximately 2,000 new gTLD applications, it would be cost prohibitive and nearly impossible for trademark owners to police their marks across such a large number of new gTLDs, even with the assistance of ICANN’s proposed trademark protection measures.  Although some registry operators have voluntarily enhanced their rights protection mechanisms, absent a requirement that registries bolster the existing rights protection mechanism, it is unlikely that all registries will follow suit. For this reason, the best solution is to strengthen the rights of trademark owners through enhancement of the existing framework.